EXHIBIT 10.1
SALE AND PURCHASE AGREEMENT
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THIS AGREEMENT is made the 15th day of January 2007 by and between:
(1) ▇▇▇▇▇▇ INTERNATIONAL GROUP LTD. (Company Registration No. 199801660M),
a company incorporated in Singapore with its registered office at ▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, #▇▇-▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ (the
"PURCHASER"); and
(2) THE SEVERAL PERSONS NAMED IN SCHEDULE 1 (the "VENDORS").
WHEREAS:
(A) M2B World Asia Pacific Pte Ltd is a company incorporated in Singapore
with its registered address at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ #▇▇-▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ (the "COMPANY"). As at the date of this Agreement, the
Company has an issued and paid-up share capital of S$43,981,964
consisting of 42,459,978 ordinary shares.
(B) As at the date of this Agreement, the Vendors beneficially own the
entire issued and paid-up capital of the Company in the proportions as
set out against the Vendors' respective names in Schedule 1.
(C) The Purchaser has, for the purposes of investing in the Company, agreed
to purchase the Sale Shares (as defined below) from the Vendors, at the
Consideration (as defined below) and on the terms and conditions set
out in this Agreement.
NOW IT IS HEREBY AGREED as follows:
1. DEFINITION AND INTERPRETATION
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1.1 DEFINITIONS. As used in this Agreement, the following terms have the
following meanings:
"AFFILIATE" means, with respect to any person (the "SPECIFIED PERSON"),
any person other than the specified person directly or indirectly
controlling, controlled by or under direct or indirect common control
with the specified person and, without limiting the generality of the
foregoing, includes: (a) any officer or director of the specified
person, (b) any such director's parent, spouse, sibling or child (a
"RELATIVE"), (c) one or more of such directors, officers, relatives or
combination thereof (a "GROUP"), and (d) any person controlled by any
such director, officer, relative or group or in which any such
director, officer, relative or group beneficially owns or holds 50 per
cent. or more of any class of share capital or equity or profits
interest. For the purposes of this definition, the term shall not
include a person in which the specified person has an interest coupled
with the right to veto specific matters concerning such person but
which such specified person does not otherwise control;
"AMARU" means Amaru Holdings Limited;
"AUTHORISED PERSONS" means the persons authorised by the Vendors or the
Purchaser, as the case may be, such as officers, directors and advisers
to represent them/it to deliver to or to receive any Documents
(including but not limited to documents stipulated in Clause 4 for
Completion) on their/its behalf of the Vendors or the Purchaser, as the
case may be;
"BUSINESS DAY" means a day (excluding Saturdays and Sundays) on which
banks are open for normal banking business in Singapore;
"CODE" means the Singapore Code on Take-overs and Mergers;
"COMPLETION" means the completion of the sale and purchase of the Sale
Shares and the issue and allotment of the Consideration Shares in
accordance with Clause 2;
"COMPLETION DATE" means the date of Completion, being 31 December 2007
or such date as the Purchaser and the Vendors may mutually agree in
writing;
"CONSIDERATION" means the consideration for the purchase of the Sale
Shares pursuant to Clause 2.2;
"CONSIDERATION SHARES" means 660 million new ordinary shares in the
capital of the Purchaser;
"CONTEMPLATED TRANSACTIONS" means the transactions contemplated in this
Agreement, including but not limited to the transactions stipulated in
Clause 2;
"CONTRACT" means any contract, agreement, indenture, note, bond, loan,
instrument, lease, conditional sale contract, mortgage, licence,
franchise, commitment or other binding arrangement not in the ordinary
course of business involving a commitment, obligation or commitment of
not less than S$1,000,000 (or the equivalent in any other currency) or
any contract for which specific performance is available as a remedy;
"CONSIDERATION PRICE" means the consideration for the purchase of the
Sale Shares pursuant to Clause 2.2;
"CONTROL" when used with respect to any specified person means the
possession, directly or indirectly, of power to direct or cause the
direction of the management and policies of such specified person,
whether through the ownership of voting shares or by contract or
otherwise;
"DISCLOSURE LETTER" means the letter to be dated a date on or before
the Completion Date from the Vendors to the Purchaser or from the
Purchaser to Vendors (as the case may be) disclosing:
(i) information constituting warranties to the Vendors' Warranties
or the Purchaser Warranties (as the case may be); and
(ii) details of other matters referred to in this Agreement;
"DOCUMENTS" means all documents, information, Contracts, instruments,
certificates, notices, consents, affidavits, letters, telegrams,
telexes, statements, schedules (including Schedules to this Agreement)
and any other papers whatsoever;
"ENCUMBRANCE" means any mortgage, assignment of receivables, debenture,
Lien, charge, pledge, title retention, right to acquire, security
interest, options, rights of first refusal and any other encumbrance or
condition whatsoever;
"FINANCIAL YEAR END" means 31 March 2006
"GOVERNMENTAL BODY" means any agency, or political subdivision whether
federal, state, local or foreign, or any agency or instrumentality of
any such government or political subdivision or any court or
arbitrator, whether in Singapore, the United States of America, the
British Virgin Islands (as the case may be) or elsewhere;
"GROUP" means the Company and its Subsidiary, "GROUP COMPANIES" means
all of them and "GROUP Company" means any of them;
"GROUP BALANCE SHEET" means the consolidated balance sheet of the Group
as of the Group Balance Sheet Date;
"GROUP BALANCE SHEET DATE" means 31 December 2005;
"ISSUE PRICE" means S$0.25 per Consideration Share;
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"KEY EMPLOYEES" shall mean such employees as shall be identified by the
Purchaser or Amaru (as the case may be) in writing prior to the
Completion Date;
"LAW" means any applicable law, statute, code, ordinance, regulation or
other requirement;
"LIEN" means, with respect to any property or asset, any mortgage,
lien, pledge, charge, security interest, encumbrance or other adverse
claim of any kind in respect of such property or asset;
"LISTING APPROVAL" means the approval-in-principle of the SGX-ST for,
amongst other things, the listing and quotation of the Consideration
Shares on the SGX-ST and the transfer of the Sale Shares;
"MATERIAL ADVERSE EFFECT" means a material adverse effect on the
condition (financial or otherwise), business, assets, results or
prospects of the Group;
"ORDER" means any applicable order, judgment, injunction, award, decree
or writ made under any applicable law;
"PARTY" means a party to this Agreement including any party acceding to
this Agreement after the date hereof; and "PARTIES" shall have the
correlative meaning;
"PERMIT" includes any license, permit, order, approval of or any
required registration with any Governmental Body;
"PERSON" means any individual, corporation, partnership, firm, joint
venture, association, joint-stock company, trust, unincorporated
organisation, Governmental Body, stock exchange or other entity;
"PROPERTY" or "PROPERTIES" means real, personal or mixed property,
tangible or intangible;
"PROPOSED ACQUISITION" means the proposed acquisition by the Purchaser
of the Sale Shares from the Vendors pursuant to the terms and
conditions of this Agreement;
"PURCHASER BALANCE SHEET" means the balance sheet of the Purchaser as
of the Financial Year End;
"PURCHASER SUBSIDIARIES" means ▇▇▇▇▇▇ Consultants Pte Ltd, ▇▇▇▇▇▇
Professional Learning Pte Ltd, AIMT Pte. Ltd., ▇▇▇▇▇▇ International
College Pty Ltd and ▇▇▇▇▇▇ Open University Corporation;
"PURCHASER WARRANTIES" means the representations, warranties and
undertakings on the part of the Purchaser set out in Clause 5.2 and
Schedule 3;
"REQUIRED CONSENTS" includes any consent, approval or action or the
filing or giving of notice to, any Governmental Body or any other
person in connection with the Contemplated Transactions. For the
avoidance of any doubt, "Required Consents" shall include, but not
limited to, the consents and approvals described at Clause 3.1(c);
"SALE SHARES" means 42,459,978 shares in the issued and paid-up capital
of the Company, legally and beneficially owned by the Vendors,
comprising the entire issued and paid-up capital of the Company;
"SGX-ST" means the Singapore Exchange Securities Trading Limited;
"SHARES" means the ordinary shares the capital of the Purchaser;
"SIC" means the Securities Industry Council;
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"SIC APPROVAL" means the approval of and confirmation by the SIC in
connection with the matters referred to in Clauses 3.1(c)(iv);
"SUBSIDIARY" means M2B World Holdings Limited;
"S$" means the lawful currency of Singapore;
"TRANSFER" means any sale, exchange, gift or other transfer or
disposition whether voluntary or otherwise;
"US$" means the lawful currency of the United States of America;
"VENDORS' WARRANTIES" means the representations, warranties and
undertakings on the part of the Vendors set out in Clause 5.1 and
Schedule 2; and
"WHITEWASH RESOLUTION" means the approval of the Purchaser's
independent shareholders at a general meeting, as set out in Clause
3.1(c)(ii).
1.2 INTERPRETATION.
(a) References to Clauses and Schedules are, unless otherwise
stated, to articles and clauses of, and schedules to, this
Agreement.
(b) References to any enactment (meaning any statute or statutory
provision of Singapore or elsewhere and any subordinate
legislation made under any such statute or statutory
provision) shall be construed as references to: (i) any
enactment which that enactment has directly or indirectly
replaced (whether with or without notification), and (ii) that
enactment as re-enacted, replaced or modified from time to
time, whether before, on or after the date hereof.
1.3 The headings in this Agreement are for convenience only and shall not
affect the construction or interpretation of this Agreement.
1.4 References to "AGREEMENT" and "THIS AGREEMENT" are references to this
Share Purchase Agreement, amended in writing from time to time.
1.5 References to "KNOWLEDGE" with respect to a company or other entity,
means the knowledge of any of the directors or officers of such company
or other entity, and "KNOWS" has the correlative meaning.
2. SALE OF THE SALE SHARES
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2.1 SALE OF THE SALE SHARES. Subject to the terms and conditions of this
Agreement, the Vendors (each as to those of the Sale Shares set out
against such Vendor's name in Schedule 1) shall sell as legal and
beneficial owner and the Purchaser, relying on the several
representations, warranties and undertakings contained in this
Agreement, shall purchase free from all Encumbrances and together with
all rights and benefits now and hereafter attaching thereto, all the
Sale Shares. For the avoidance of doubt, the rights and interests
comprised in the Sale Shares to be acquired by the Purchaser pursuant
to these presents shall include all rights and interests and all legal
and beneficial titles to the Subsidiaries and all assets and properties
owned directly or indirectly by the Group as at the date hereof.
2.2 CONSIDERATION. Subject to Clause 2.4, the Consideration for the sale
and purchase of the Sale Shares shall (subject to adjustment as
provided in this Agreement) be the sum of S$165 million and shall be
satisfied in full by the allotment and issue by the Purchaser to the
Vendors of the Consideration Shares, credited as fully paid up, at the
Issue Price, free from all Encumbrances and together with all rights,
entitlements and benefits accruing or attaching thereto and such
Consideration Shares shall rank PARI PASSU in all respects with all the
other existing issued shares in the share capital of the Purchaser as
at the Completion Date. Each Vendor shall be entitled to that number of
Consideration Shares set out against the Vendor's name in column (3) in
Schedule 1.
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2.3 PAYMENT. The Purchaser shall allot and issue the Consideration Shares
(credited as fully paid up) to the Vendors at Completion in accordance
with Clause 4.1(b), against the Vendors' compliance with their
obligations under Clauses 3.1 and 4.1(a). The allotment and issue of
the Consideration Shares, credited as fully paid up, and in accordance
with the provisions of this Agreement, shall be in full and final
satisfaction of the Purchaser's obligations in respect of the payment
of the Consideration.
2.4 ADJUSTMENTS TO CONSIDERATION. The parties agree that following the due
diligence exercises to be conducted by the parties as provided in
Clause 3.1(a) and in the event that the profit warranty under Clause
5.1.2(b) is not achieved, the Consideration may be adjusted in such
manner as may be mutually agreed between the parties in good faith. For
the avoidance of doubt, any adjustment in the Consideration may include
adjustments to the number and price of the Consideration Shares to be
issued by the Purchaser to the Vendors.
3. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE PARTIES TO COMPLETE
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3.1 CONDITIONS PRECEDENT. The obligation of the parties to enter into
and complete the Completion is subject to the fulfillment on or prior
to the Completion Date of the following conditions:
(a) SATISFACTORY DUE DILIGENCE.
(i) The results of such legal, financial and tax due
diligence investigations on the Group conducted by
the Purchaser and its advisors (including inspections
of the respective audited financial accounts
including, but not limited to, the income statements
of the Company and each of the Subsidiaries, all of
which to be delivered to the Purchaser upon the
Purchaser's written request to the Company at least
three (3) Business Days in advance), being reasonably
satisfactory to the Purchaser.
(ii) The results of such legal, financial and tax due
diligence investigations to be conducted by Amaru
and/or the Company on the Purchaser and the Purchaser
Subsidiaries (based primarily on publicly available
information to be delivered to Amaru and/or the
Company upon the latter's written request to the
Purchaser at least three (3) Business Days in
advance), being reasonably satisfactory to Amaru
and/or the Company.
(b) REPRESENTATIONS AND COVENANTS. The Vendors' Warranties and the
Purchaser Warranties contained in this Agreement shall be true
in all material respects on and as of the Completion Date with
the same force and effect as though made on and as of the
Completion Date. The Vendors and the Purchaser shall have
performed and complied with all their respective covenants and
agreements required by this Agreement to be performed or
complied with by each of them on, or prior to, the Completion
Date.
(c) CONSENTS AND APPROVALS. All Required Consents shall have been
obtained without restrictions or limitations whatsoever
unacceptable to the parties, and be in full force and effect,
and the parties shall have been furnished with evidence
reasonably satisfactory to the other party of the granting of
such Required Consents, in particular, and without limitation:
(i) the approval of the Purchaser's shareholders at a
general meeting and its board of directors (as
appropriate) in respect of:
(aa) the acquisition by the Purchaser of the Sale
Shares; and
(bb) the issue of the Consideration Shares to the
Vendors in consideration therefor;
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(ii) the approval of the Purchaser's independent
shareholders at a general meeting in respect of the
waiver of the rights of the independent shareholders
of the Purchaser to receive a mandatory offer from
the Vendors (or any of them) and parties acting in
concert with them pursuant to Rule 14 of the Code for
all the issued and paid-up shares of the Purchaser
that they do not own following the issue and
allotment of the Consideration Shares ("WHITEWASH
RESOLUTION");
(iii) the receipt and non-withdrawal of the Listing
Approval, provided always that if the SGX-ST shall
impose any conditions on the Purchaser, such
conditions shall not be onerous and shall be
reasonably acceptable to the parties and, if any such
condition is required to be fulfilled before
Completion, the fulfilment of such condition before
Completion; and
(iv) the receipt and non-withdrawal of the approval of the
SIC granted to the Vendors to dispense with the
requirements of Rule 14 of the Code to make an offer
to the shareholders of the Purchaser arising from the
receipt by the Vendors of the Consideration Shares,
subject to the conditions set out in the said SIC
approval, provided always that if the SIC shall
impose any conditions on the Vendors or the
Purchaser, such conditions shall not be onerous and
shall be reasonably acceptable to the Vendors or the
Purchaser (as the case may be) and, if any such
condition is required to be fulfilled before
Completion, the fulfilment of such condition before
Completion;
(v) the approval of shareholders of Amaru Inc., if
required under applicable state law under and/or
federal securities law and its board of directors in
respect of the Contemplated Transactions, in
accordance with and pursuant to the relevant and
applicable laws and regulations governing and binding
upon Amaru Inc.; and
(vi) all other necessary consents and approvals for the
Contemplated Transactions, if required and
applicable, being granted and not withdrawn or
revoked by third parties (including without
limitation, any Government Body, stock exchange and
other relevant authority in any jurisdiction) and if
such consents are obtained subject to any
condition(s) and where such condition(s) affect any
of the parties, such condition(s) being acceptable to
the party concerned and, if such condition(s) are
required to be fulfilled before Completion, such
condition(s) being fulfilled before Completion;
(d) TRANSFER AND/OR ASSIGNMENT OF ALL ASSETS. Subject to the
approval of the Purchaser's shareholders at a general meeting
(if necessary) and its board of directors, the Purchaser shall
transfer and/or assign all the assets (including without
limitation, the properties and the intellectual property
rights, businesses, rights, obligations, receivables and debts
of the Purchaser) to such company or entity as the Purchaser
deems fit, within such time as the Parties shall mutually
agree such that, save for its current paid-up capital and the
Shares, the Purchaser shall have no further business or
business activity (including any prospective business and
business activity), shall have no subsidiary or associated
company, shall have no liabilities (actual or contingent,
disclosed or undisclosed, known or unknown) and shall have no
rights or obligations (whether contractual or arising in law)
whatsoever, save for any residual business;
(f) INDEPENDENT VALUATION REPORT. Amaru shall deliver a valuation
report by an independent auditor to the Purchaser confirming
that the value of the assets of the Company is no less than
that of the Consideration Price.
(g) PURCHASER REMAINING ON SGX-ST. The Purchaser shall remain
listed on SGX-ST from the date of this Agreement until the
date of the transfer of the Sale Shares to the Purchaser and
the allotment and issue of the Consideration Shares.
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(h) PRIVATE PLACEMENT. The Purchaser hereby undertakes to use its
best endeavours to procure a private placement by way of the
issue and allotment of 200 million new Shares at S$0.27 per
Share, (which issue price represents a discount of 9% from the
volume weighted average price of ▇▇▇▇▇▇ shares on 12 January
2007, the last trading day immediately prior to the date of
this Agreement , subject to such approvals as may be necessary
including the approvals of the Purchaser's shareholders and
the SGX-ST.. The net proceeds of the aforesaid placement shall
be utilised towards the future costs of development and
expansion of the business of the Company and working capital
for the Group.
(i) COMPLETION BY THE PARTIES. The parties shall on Completion
Date execute such further documents, agreements, deeds, and do
such further acts and things, as may be required so that full
effect shall be given to the provisions of this Agreement and
the Contemplated Transactions.
3.2 The parties shall use their respective best endeavours to procure the
fulfilment of such conditions, and in particular shall furnish such
information, supply such documents, pay such fees and do all such acts
and things (including making any amendments to the Agreement as may be
required by the SIC) as may be required to enable such conditions to be
fulfilled.
3.3 For the purposes of Clauses 3.1(c), the parties shall promptly furnish
the SGX-ST and the SIC with all information required by the SGX-ST
and/or the SIC (as the case may be) for the purpose of their
consideration and evaluation of the parties' application for the
Listing Approval and/or the non-withdrawal of the SIC Approval (as the
case may be).
3.4 If any of the conditions in Clause 3.1 above is not fulfilled and the
fulfilment of such conditions is not waived by the relevant party by a
mutually agreed date, this Agreement shall IPSO FACTO cease and
determine and save in respect of any breach of Clause 3.2, Clause 3.3
and/or Clause 9.2, none of the parties shall have any claim against the
other for costs, damages, compensation or otherwise.
4. COMPLETION
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4.1 COMPLETION. The Completion shall take place on the Completion Date, at
such place and time as Amaru and the Purchaser may agree, where all of
the events described below shall occur:
(a) VENDORS DELIVERIES. At Completion, the Vendors shall deliver
to the Purchaser the following:
(i) evidence in form and substance satisfactory to the
Purchaser of the satisfaction of the relevant
conditions specified in Clause 3.1;
(ii) a certificate signed by the Vendors, confirming that
all the Vendors' Warranties have been complied with
and would be correct in all material respects as if
repeated on the Completion Date by reference to the
circumstances then existing and that all the
representations, Vendors' Warranties and undertakings
on the part of the Vendors have been fully performed
and observed by the Vendors;
(iii) duly executed transfers of the Sale Shares in favour
of the Purchaser accompanied by certificates
reflecting the Purchaser as owner of the Sale Shares;
(iv) such documents as may be required for submission to
any Governmental Body and such other relevant
competent authority to give full effect to the
Contemplated Transactions;
(v) copies of the resolutions of the directors and the
shareholders of the Company, duly certified as true
copies by a director, under which the directors and
shareholders (as the case may be) of the Company have
approved (in such terms as the Purchaser may
approve):
(aa) the transfer of the Sale Shares to the
Purchaser; and
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(bb) the issue of such certificate reflecting the
Purchaser as owner of the Sale Shares; and
(vi) such waivers or consents as may be necessary to
enable the Purchaser to be registered as holder of
any and all of the Sale Shares and to give full
effect to the Contemplated Transactions.
(b) PURCHASER DELIVERIES. At Completion, the Purchaser shall
deliver to the Vendors the following:
(i) evidence in form and substance satisfactory to the
Vendors of the satisfaction of the relevant
conditions specified in Clause 3.1;
(ii) a certificate signed by a director of the Purchaser
confirming that all the Purchaser Warranties set out
in Schedule 3, where applicable, have been complied
with and would be correct in all material respects as
if repeated on the Completion Date by reference to
the circumstances then existing;
(iii) executed share certificates in respect of the
Consideration Shares to be allotted and issued to the
Vendors pursuant to Clause 2.3;
(iv) copies of the resolutions of the directors and the
shareholders of the Purchaser, duly certified as true
copies by a director, under which the directors and
the shareholders (as the case may be) of the
Purchaser have approved (in such terms as the Vendors
may approve):
(aa) for the Proposed Acquisition;;
(bb) the issue and allotment of the Consideration
Shares to CDP for the account of the
Vendors;
(cc) the issue of share certificates in respect
of the Consideration Shares to be allotted
and issued to CDP for the account of the
Vendors);
(dd) the issue of share certificates in respect
of the Consideration Shares to be allotted
and issued the Vendors;
(ee) the written resignations of all existing
directors of the Purchaser as directors to
take effect on the Completion Date, with an
acknowledgment signed by each of them that
they have no claim against the Purchaser in
respect of breach of contract, compensation
for loss of office, redundancy or unfair
dismissal or any other ground whatsoever;
and
(ff) the appointments of such persons, as may be
designated by Amaru in writing to the
Purchaser prior to the Completion Date, as
directors of the Purchaser; and
(v) a copy of the Listing Approval.
For the purpose of this Agreement, each party shall be deemed to have
complied with its respective obligations pursuant thereto upon due
receipt by the Authorised Persons of the Vendors or the Purchaser, as
the case may be, of the relevant documents.
4.2 BREACH OF OBLIGATIONS. If any of the Vendors or the Purchaser breaches
its obligations under this Clause 4, the party not in breach shall be
entitled, in addition to and without prejudice to all other rights and
remedies available to it, including the right to claim damages, to:
(a) elect to terminate this Agreement;
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(b) effect Completion so far as practicable having regard to the
defaults which have occurred and subject to any terms and
conditions which the parties may agree in writing; or
(c) fix a new date for Completion (not being 30 days after the
Completion Date) in which case the provisions of this Clause 4
shall apply to Completion as so deferred.
4.3 ACCRUED RIGHTS. If any of the Vendors or the Purchaser terminates this
Agreement pursuant to Clause 4.2(a), each party's further rights and
obligations shall cease immediately upon termination except in respect
of Clauses 9.1 to 9.16 but termination shall not affect a party's
accrued rights and obligations as at the date of termination.
5. WARRANTIES
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5.1.1 VENDORS' WARRANTIES. Each of the Vendors represents and warrants to the
Purchaser, subject to the Disclosure Letter:
(a) it is and will on Completion be legally and beneficially
entitled to or is otherwise able to procure the transfer of
those Sale Shares set out against its name in Schedule 1 to
the Purchaser;
(b) those Sale Shares set out against its name in Schedule 1 are
and will on Completion be free from any Encumbrances;
(c) it has the full legal right and power to execute and deliver
this Agreement and to perform fully its respective obligations
under it and has taken all action necessary to authorise such
execution and delivery and the performance of such
obligations;
(d) this Agreement constitutes legal, valid and binding
obligations of each Vendor enforceable in accordance with its
terms;
(e) the execution, delivery and performance of this Agreement by
the Vendors and the consummation of any of the Contemplated
Transactions will not:
(i) violate any provision of the Memorandum and Articles
of Association (or other constitutional documents) of
each of the Vendors;
(ii) require the approval or consent of any Governmental
Body or the approval or consent of any other person;
and
(iii) conflict with or result in any breach or violation of
any of the terms and conditions of, or constitute (or
with notice or lapse of time or both constitute) a
default under, any applicable Law or Order or any
Contract to which any of the Vendors is a party or by
or to which any of the Vendors is bound or subject;
and
(f) as at the Completion Date, the Vendors' Warranties as set out
in Schedule 2 subject only to:-
(i) any matter which is fairly disclosed in the
Disclosure Letter and any matter expressly provided
for under the terms of this Agreement; and
(ii) any matter or thing hereafter done or omitted to be
done pursuant to this Agreement or otherwise at the
request in writing or with the approval in writing of
the Purchaser.
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5.1.2 PROFIT WARRANTY.
(a) Amaru further warrants to the Purchaser that the audited
consolidated profit before tax (the "ADJUSTED PBT") of the
Company for the two financial years immediately following the
Completion Date (the "WARRRANTY PERIOD") shall not be less
than a cumulative aggregate of US$20 million (the "GUARANTEED
PROFIT"). In the event that the Adjusted PBT for the Warranty
Period is less than the aforesaid amount of Guaranteed Profit,
Amaru shall be liable to pay the Purchaser's independent
shareholders as at the date of the general meeting referred to
in Clause 3.1(c)(i) the difference between the Guaranteed
Profit and the aggregate Adjusted PBT for the Warranty Period
in cash.
(b) Amaru also warrants to the Purchaser that the profit before
tax (on a proforma basis) of the Company for the financial
year end 2006 shall not be less than US$2.5 million.
5.1.3 INTELLECTUAL PROPERTY RIGHTS WARRANTY. Subject to the Disclosure
Letter, Amaru further warrants that all its intellectual property
rights owned by the Group comprise all the intellectual property rights
necessary to enable the Group to carry on its business fully and
effectively in the ordinary course as carried on up to the present time
and no such assets are used wholly or partly for any purpose other than
its business.
5.2 PURCHASER WARRANTIES. The Purchaser represents and warrants to the
Vendors:
(a) it has the full legal right and power to execute and deliver
this Agreement and to perform fully its respective obligations
under it and has taken all action necessary to authorise such
execution and delivery and the performance of such
obligations;
(b) this Agreement constitutes legal, valid and binding
obligations of the Purchaser enforceable in accordance with
its terms;
(c) the execution, delivery and performance of this Agreement by
the Purchaser and the consummation of any of the Contemplated
Transactions will not:
(i) violate any provision of the Memorandum and Articles
of Association (or other constitutional documents) of
each of the Vendors;
(ii) require the approval or consent of any Governmental
Body or the approval or consent of any other person;
and
(iii) conflict with or result in any breach or violation of
any of the terms and conditions of, or constitute (or
with notice or lapse of time or both constitute) a
default under, any applicable Law or Order or any
Contract to which any of the Vendors is a party or by
or to which any of the Vendors is bound or subject;
and
(d) as at the Completion Date, the Purchaser Warranties as set out
in Schedule 3 subject only to:
(a) any matter which is fairly disclosed in the
Disclosure Letter and any matter expressly provided
for under the terms of this Agreement; and
(b) any matter or thing hereafter done or omitted to be
done pursuant to this Agreement or otherwise at the
request in writing or with the approval in writing of
the Purchaser.
(e) the Consideration Shares will on Completion rank pari passu
with the existing shares of the Purchaser and be free from any
and all Encumbrances.
6. UNDERTAKINGS AND OTHERS
-----------------------
VENDORS' UNDERTAKINGS
---------------------
10
6.1 Each of the Vendors undertakes that from the date of this Agreement and
until Completion it shall (except where otherwise agreed in writing by
the Purchaser, such agreement and consent not to be unreasonably
withheld):
(a) ensure that there shall not be any amendment to the memorandum
of association or the articles of association of the Company;
(b) cause the business of the Group to be conducted only in the
ordinary and usual course or in accordance to its business
plans and shall not make (or agree to make) any payment other
than (i) routine payments in the ordinary and usual course of
trading and/or (ii) payments in fulfilment of any legal
obligation binding upon the Group prior to the date of this
Agreement;
(c) ensure that the Group shall not grant or create any interest
in its, or concerning its, share capital or assets in favour
of any person or entity, other than in the ordinary course of
business;
(d) procure that each Group Company shall promptly give to the
Purchaser, its agents, representatives and professional
advisers at their written request at least three (3) Business
Days in advance, whatever facilities and information relating
to the relevant Group Company and its assets, liabilities,
contracts and affairs, and documents of title and other
evidence of ownership of its assets, that the Purchaser may
reasonably require in connection with the Purchaser's due
diligence exercise;
(e) not do, allow or procure any act or omission which would or
would likely result in the passing of a resolution for the
winding up of each Group Company or the appointment of a
liquidator, receiver and/or manager, judicial manager or any
other similar officer of each Group Company or over any part
of the assets or business of each Group Company; and
(f) not do, allow or procure any act or omission which would or
would likely result in the sale, transfer or disposal of the
whole or a substantial part of the Group's undertaking, assets
or property or purchase, sale, transfer, disposal, lease or
licence of any real property or any interest therein other
than in the usual course of business.
6.2 Amaru further undertakes to the Purchaser to indemnify and keep the
Purchaser fully indemnified against any damages, losses, costs
(including legal costs on an indemnity basis) and expenses which the
Purchaser may suffer or incur in connection with any breach of any
warranty in Schedule 2 relating to any taxation matters.
6.3 In the event that any obligation should be held to be invalid as an
unreasonable restraint of trade or for any other reason whatsoever but
would have been held valid if part of the wording thereof is reduced or
the range of activities or the duration of such obligation of area
dealt with thereby is reduced in scope, such obligations shall apply
with such modifications as may be necessary to make them valid and
effective.
6.4 The Vendors further undertake not to sell, realise, transfer or
otherwise dispose of 100% of the Consideration Shares for a period of
six months immediately after the listing and quotation of the Shares
on the SGX-ST, and 50% of the Consideration Shares for a period of six
months thereafter (the "MORATORIUM") and the Vendors further undertake
that they shall abide by such other conditions as may be imposed by
the SGX-ST for the Proposed Acquisition, provided that such conditions
are not onerous and are reasonably acceptable to the Vendors. For the
avoidance of doubt, the Moratorium shall apply to any disposal
including any distribution in specie or capital reduction exercise
involving the Consideration Shares.
6.5 The Vendors further undertake to and covenant with the Purchaser that
they shall use best endeavours to procure that:
11
(i) the substantial shareholders of Amaru Inc. and the Company
(being shareholders who each have interest in not less than 5%
of the total votes attached to all the shares in the Company)
shall vote, INTER ALIA, in favour of the following resolutions
at an extraordinary general meeting to be convened or via a
circular resolution:
(a) for the Proposed Acquisition; and
(b) for the sale and transfer of the Sales Shares to the
Purchaser.
6.6 Amaru undertakes to and covenants with the Purchaser that it will not,
for the three (3) financial years immediately following the Completion
Date, compete with the Group in Asia Pacific excluding Australia.
6.7 Each and every obligation under this Clause shall be treated as a
separate and distinct obligation and shall be severally enforceable as
such and in the event of any obligation or obligations being or
becoming unenforceable the same shall be deleted from this Clause and
any such deletion shall not affect the enforceability of any other part
of this Clause as remain not so deleted.
PURCHASER'S UNDERTAKINGS
------------------------
6.8 The Purchaser undertakes to the Vendors that from the date of this
Agreement and until Completion it shall (except where otherwise agreed
in writing by the Vendors):
(a) not undertake any bonus issue, stock split or do any thing to
its share capital or capital reserve or allot any new Shares,
or marketable securities or grant any option over Shares
(other than employee share options in accordance with its
usual practice) or marketable securities or enter into any
other agreement or undertaking to do the same (otherwise than
in accordance with or in furtherance of this Agreement);
(b) not (whether in the ordinary course of business or otherwise)
acquire, or agree to acquire, any asset which may have a
material effect upon the nature or scope of its business;
(c) dispose of, or agree to dispose of, all its existing
businesses prior to or on Completion of the Proposed
Acquisition, other than the ordinary course of business
pertaining to current business;
(d) provide for appropriate arrangements for the termination of
employment of all the existing employees of the Purchaser on
or before the Completion Date, unless otherwise agreed with
the Vendor or the Company;
(e) procure that each of the Purchaser and/or the Purchaser
Subsidiaries shall promptly give to the Company, its agents,
representatives and professional advisers at their written
request at least three (3) Business Days in advance, whatever
facilities and information relating to the Purchaser and the
relevant Purchaser Subsidiaries and its assets, liabilities,
contracts and affairs, and documents of title and other
evidence of ownership of its assets, that the Company may
reasonably require in connection with the Company's due
diligence exercise; and
(f) not do, allow or procure any act or omission which would or
would likely result in the passing of a resolution for the
winding up of each of the Purchaser and/or the Purchaser
Subsidiaries or the appointment of a liquidator, receiver
and/or manager, judicial manager or any other similar officer
of each of the Purchaser and/or the Purchaser Subsidiaries
over any part of the assets or business of each of the
Purchaser and/or the relevant Purchaser Subsidiaries.
12
6.9 The Purchaser further undertakes to and covenants with the Vendors
that it shall use best endeavours to procure that the substantial
shareholders of the Purchaser (being shareholders who each have
interest in not less than 5% of the total votes attached to all the
shares in the Purchaser) shall vote, INTER ALIA, in favour of the
following resolutions at an extraordinary general meeting to be
convened:
(i) for the Proposed Acquisition;
(ii) for the allotment and issuance of the Consideration Shares to
the Vendors; and
(iii) for the Whitewash Resolution.
6.10 Pending Completion, the Purchaser shall consult fully with the Vendors
in relation to any matters that may have a material effect upon the
Purchaser's group.
6.11 The Purchaser further undertakes to the Vendors to indemnify and keep
each of the Vendors fully indemnified against any damages, losses,
costs (including legal costs on an indemnity basis) and expenses which
the Vendors may suffer or incur in connection with any breach of any
warranty in Schedule 3 relating to any taxation matters.
6.12 In the event that any obligation should be held to be invalid as an
unreasonable restraint of trade or for any other reason whatsoever but
would have been held valid if part of the wording thereof is reduced or
the range of activities or the duration of such obligation of area
dealt with thereby is reduced in scope, such obligations shall apply
with such modifications as may be necessary to make them valid and
effective.
6.13 Each and every obligation under this Clause shall be treated as a
separate and distinct obligation and shall be severally enforceable as
such and in the event of any obligation or obligations being or
becoming unenforceable the same shall be deleted from this Clause and
any such deletion shall not affect the enforceability of any other part
of this Clause as remain not so deleted.
PUBLIC FLOAT REQUIREMENTS
-------------------------
6.14 The Vendors shall use their best endeavours to ensure that.the public
float requirements pursuant to the listing rules of the SGX-ST are met
at all times post the Completion. This Clause shall continue to have
full force and effect notwithstanding Completion.
7. GENERAL INDEMNIFICATION
-----------------------
7.1 OBLIGATION OF THE VENDORS TO INDEMNIFY. The Vendors agree to indemnify,
defend and hold harmless the Purchaser (and its directors, officers and
employees) from and against all losses, liabilities, damages,
deficiencies, demands, claims, actions, judgments or causes of action,
assessments, costs or expenses (including, without limitation,
interest, penalties and reasonable attorneys fees and disbursements)
based upon, arising out of or otherwise in respect of any inaccuracy in
or any breach of any representation, warranty, covenant or agreement of
the Vendors contained in this Agreement or in any documents delivered
pursuant to this Agreement.
7.2 OBLIGATION OF THE PURCHASER TO INDEMNIFY. The Purchaser agrees to
indemnify, defend and hold harmless the Vendors (and its directors,
officers and employees) from and against all losses, liabilities,
damages, deficiencies, demands, claims, actions, judgments or causes of
action, assessments, costs or expenses (including, without limitation,
interest, penalties and reasonable attorneys fees and disbursements)
based upon, arising out of or otherwise in respect of any inaccuracy in
or any breach of any representation, warranty, covenant or agreement of
the Purchaser contained in this Agreement or in any documents delivered
pursuant to this Agreement.
8. TERMINATION OF AGREEMENT
------------------------
8.1 TERMINATION. This Agreement may be terminated by the following party by
written notice to the other parties prior to the Completion as follows:
13
(a) at the election of the Vendors or the Purchaser in accordance
with Clauses 4.2(a) and 4.3;
(b) at the election of the Purchaser, if any of the Vendors has
breached any material representation, warranty, covenant or
agreement contained in this Agreement, which breach cannot be
or is not cured by the Completion Date;
(c) at the election of the Vendors, if the Purchaser has breached
any material representation, warranty, covenant or agreement
contained in this Agreement, which breach cannot be or is not
cured by the Completion Date; or
(d) at any time on or prior to the Completion Date, by mutual
written consent of the Vendors and the Purchaser.
If this Agreement so terminates, it shall become null and void and have
no further force or effect, except as provided in Clause 8.2.
8.2 SURVIVAL AFTER TERMINATION. If this Agreement is terminated in
accordance with Clause 8.1, this Agreement shall become void and of no
further force and effect, except for Clauses 9.1 to 9.16 PROVIDED the
termination of this Agreement shall not in any way or manner affect or
prejudice the rights or liabilities by any parties accrued or incurred
prior to the termination of this Agreement.
9. MISCELLANEOUS
-------------
9.1 CHANGE OF NAME. Amaru reserves the right to change the name of the
Purchaser to such other name as it and the Accounting and Corporate
Regulatory Authority of Singapore may approve.
9.2 PUBLIC ANNOUNCEMENTS. No press releases or other public announcements
concerning this Agreement or any Contemplated Transactions shall be
made unless planned, coordinated and released jointly by all parties.
9.3 CONFIDENTIALITY. Each party agrees to hold this Agreement and all
confidential information obtained in connection with the Agreement or
any Contemplated Transaction confidential and not to disclose the
Agreement, any Contemplated Transactions or such information to third
parties without the prior written consent of the other parties hereto.
The foregoing obligation shall not apply to the extent: (a) the
information being disclosed is or has become publicly known or known to
third parties at the time of disclosure through no fault of the
disclosing party; (b) the information was generated independently by
the third party before disclosure by the disclosing party; (c)
disclosure is or becomes required by applicable Law or legal process,
including pursuant to court proceedings, court order, applicable stock
exchange or governmental regulation, or otherwise; (d) such disclosure
is to an Affiliate or adviser of the disclosing party who has agreed to
maintain the confidentiality of such information; or (e) pursuant to
the rules of the SGX-ST or any other Governmental Body.
9.4 OBLIGATIONS SEVERAL. Where any obligation, representation, warranty or
undertaking in this Agreement is expressed to be made, undertaken or
given by two or more of the Vendors, they shall be jointly and
severally responsible in respect of it.
9.5 AUTHORITY BINDING. The Vendors agree that for the purposes of
implementing this Agreement (including, without limitation, the
receiving of any Notice, the execution and delivery of any documents
arising from and in connection with this Agreement and the giving of
any consents and/or waivers), Amaru shall be irrevocable authorised to
act on behalf of any of the Vendors and such Vendors shall be bound
accordingly.
14
9.6 CONSENT TO SPECIFIC PERFORMANCE. The parties hereto agree that it might
be impossible to measure in money the damages which would accrue to a
party by reason of failure to perform certain obligation hereunder. Any
such party shall, therefore, be entitled to seek injunctive relief,
including specific performance, to enforce such obligation and if any
action should be brought in equity to enforce any of the provisions of
this Agreement, none of the parties hereto shall raise the defence that
there is an adequate remedy at law.
9.7 NOTICES. Any notice or other communication required or permitted
hereunder shall be in writing and shall be delivered personally, sent
by facsimile transmission or sent by certified, registered or express
mail, postage prepaid to the following addresses or facsimile numbers:
If to the Purchaser, to:
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇,
#▇▇-▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Attention: [ ]
Facsimile: [ ]
If to any of the Vendors, to: AMARU HOLDINGS LIMITED
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ #▇▇-▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Attention: ▇▇ ▇▇ Bee Leng
Facsimile: 65-6336 9281
CHUA ▇▇▇▇▇ HIN
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ #▇▇-▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
CHEW ▇▇▇ ▇▇▇▇
▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
GAY ▇▇▇▇ ▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇ CHONG HIN
8A Lengkong Tiga ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
or to such other address or facsimile number as the parties may
designate by written notice. Any such communication shall be deemed
duly given, in the case of personal delivery and courier service, upon
delivery and receipt of written acknowledgement thereof, in the case of
registered mail, 14 days after posting and in the case of facsimile
transmission, upon transmission and receipt of a satisfactory
transmission transcript, provided that if such day is not a Business
Day or such time not a normal business hour then delivery shall be
deemed to have occurred on the following Business Day.
9.8 EXPENSES.
(i) Subject to Clause 9.8(iii), each party to this Agreement shall
pay its own costs and expenses incurred in relation to or in
connection with the negotiation, preparation and execution of
this Agreement and the sale and purchase hereby agreed to be
made, provided that if any party shall lawfully exercise any
right hereby conferred to rescind this Agreement before
Completion the other party shall indemnify the first-mentioned
party against expenses and costs (including legal, accounting
and other costs and expenses) incurred in the preparation of
this Agreement.
(ii) The Purchaser shall bear all stamp duties payable in
connection with the transfer of the Sale Shares from the
Vendors to the Purchaser.
(iii) In the event of non-Completion of the Proposed Acquisition as
a direct consequence of the default or omission of any party
or a failure by any party to fulfil the relevant conditions
precedent under Clause 3.1 of this Agreement (not otherwise
waived by the other party) by the Completion Date, the
15
defaulting party shall bear all costs and expenses (including
but not limited to all professionals' fees) incurred in
relation to or in connection with the negotiation, preparation
and execution of this Agreement and the sale and purchase
agreement hereby agreed to be made PROVIDED ALWAYS THAT if the
non-Completion of the Proposed Acquisition is a consequence of
factors and reasons which are beyond the control of either
party, the Purchaser shall bear half the aforesaid costs and
expenses and the Vendors collectively the other half.
9.9 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties with respect to the transactions contemplated in
this Agreement and supersedes all prior oral and written agreements,
memoranda, understandings and undertakings between the parties relating
to the subject matter of this Agreement.
9.10 WAIVERS AND AMENDMENTS; NON-CONTRACTUAL REMEDIES; PRESERVATION OF
REMEDIES. This Agreement may be amended, superseded, cancelled, renewed
or extended, and the terms hereof may be waived, without requiring the
consent from any third party not named in this Agreement and only by a
written instrument signed by the Purchaser, the Vendors or, in the case
of a waiver, by the party waiving compliance. No delay on the part of
any party in exercising any right, power or privilege hereunder shall
operate as a waiver thereof, nor shall any waiver on the part of any
party of any such right, power or privilege, nor any single or partial
exercise of any such right, power or privilege, preclude any further
exercise thereof of the exercise of any other such right, power or
privilege. The rights and remedies herein provided are cumulative and
are not exclusive of any rights or remedies that any party may
otherwise have at law or in equity. The rights and remedies of any
party based upon, arising out of or otherwise in respect of any
inaccuracy in or breach of any representation, warranty, covenant or
agreement contained in this Agreement or any documents delivered
pursuant to this Agreement shall in no way be limited by the fact that
the act, omission, occurrence or other state of facts upon which any
claim of any such inaccuracy or breach is based may also be the subject
matter of any other representation, warranty, covenant or agreement
contained in this Agreement or any documents delivered pursuant to this
Agreement (or in any other agreement between the parties) as to which
there is no inaccuracy or breach.
9.11 NO THIRD PARTY BENEFIT. The Contracts (Rights of Third Parties) Act
(Chapter 53B) shall not apply to this Agreement. Nothing in this
Agreement shall be deemed to confer any right to enforce any term of
this Agreement on anyone not a party to this Agreement. This Agreement
shall not be construed in any respect to be a contract or agreement in
whole or in part for the benefit of or binding upon anyone not a party
to this Agreement.
9.12 SUCCESSORS AND ASSIGNS. No party shall have the right to assign all or
any part of its interest in this Agreement without the prior written
consent of the other parties. This Agreement shall be binding upon and
shall inure to the benefit of the parties and their successors and
permitted assigns.
9.13 COUNTERPARTS. This Agreement may be executed by the parties hereto in
separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together
constitute one and the same instrument. Each counterpart may consist of
a number of copies hereof each signed by less than all, but together
signed by all of the parties hereto.
9.14 SCHEDULES AND ANNEXES. The Schedules and Annexes shall form part of
this Agreement as if fully set out herein.
9.15 SEVERABILITY OF PROVISIONS. If any provision or any portion of any
provision of this Agreement, or the application of any such provision
or any portion thereof to any person or circumstance, shall be held
invalid or unenforceable, the remaining portion of such provision and
the remaining provisions of this Agreement, and the application of such
provision of portion of such provision as is held invalid or
unenforceable to persons or circumstances other than those as to which
it is held invalid or unenforceable, shall not be affected thereby.
9.16 GOVERNING LAW AND ARBITRATION.
16
(a) This Agreement is governed by, and shall be construed in
accordance with, the laws of the Republic of Singapore. Any
and all disputes, controversies and conflicts between the
parties in connection with this Agreement shall, so far as is
possible, be settled amicably between the parties. Prior to
commencing any dispute resolution pursuant to this Clause
9.15, the parties agree to act in good faith and attempt to
resolve the same.
(b) In the event that an amicable settlement cannot be reached
within thirty (30) days after the parties commence relevant
settlement discussion, any and all disputes, controversies and
conflicts arising out of or in connection with this Agreement
or its performance, including disputes on its existence,
validity, binding effect, amendment or termination shall be
referred to and finally resolved by arbitration in Singapore
in accordance with the Arbitration Rules of the Singapore
International Arbitration Centre ("SIAC") for the time being
in force. The law of arbitration shall be the International
Arbitration Act (Chapter 143A) of the Singapore. The Tribunal
shall consist of three arbitrators to be appointed in the
first instance by the Purchaser and the Vendors by mutual
agreement, and failing agreement, by the chairman of the SIAC.
(c) None of the parties shall be entitled to commence or maintain
any action in a court of law upon any matter in dispute
arising from or in relation to this Agreement except for the
enforcement of an arbitral award granted pursuant to this
Clause 9.15.
(d) During the period of submission to arbitration and thereafter
until the granting of the arbitral award, the parties shall,
except in the event of termination, continue to perform all
their obligations under this Agreement, to the maximum extent
possible, without prejudice to a final adjustment in
accordance with the said award.
9.17 NO PARTNERSHIP. Nothing in this Agreement shall be taken to constitute
a partnership between the parties and none of the parties shall have
any authority to bind any other.
9.18 FURTHER ASSURANCE. Each party shall execute such documents and other
agreements and take such further actions as may be reasonably required
or desirable to carry out the provisions and the transactions
contemplated by this Agreement.
17
SCHEDULE 1
----------
VENDORS
-------
(1) (2) (3)
--- --- ---
NAME OF VENDOR NUMBER OF SALE SHARES NUMBER OF
-------------- --------------------- ---------
CONSIDERATION SHARES
--------------------
AMARU HOLDINGS LIMITED 34,681,964 539,098,165
---------- -----------
CHUA ▇▇▇▇▇ HIN 1,296,336 20,150,310
---------- -----------
CHEW ▇▇▇ ▇▇▇▇ 5,185,342 80,601,213
---------- -----------
GAY ▇▇▇▇ ▇▇▇▇▇▇ 648,168 10,075,156
---------- -----------
▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ HIN 648,168 10,075,156
---------- -----------
18
SCHEDULE 2
----------
VENDORS' WARRANTIES
-------------------
1. DUE INCORPORATION AND AUTHORITY. Each of the Group Companies is a
company duly organised and validly existing under the laws of its
jurisdiction of incorporation and has all requisite corporate power and
lawful authority to own, lease and operate its properties and to carry
on its business.
2. SHARE CAPITAL. As at the date hereof, the Company's issued and paid-up
share capital is S$43,981,964 comprising 42,459,978 ordinary shares.
All the shares issued are duly authorised, validly issued and fully
paid. There is not other class of share capital or other ownership
interests of the Company authorised or outstanding.
3. OPTION OR OTHER RIGHTS. There is no outstanding right, subscription,
warrant, call, unsatisfied pre-emptive right, option or other agreement
of any kind to purchase or otherwise to receive from any Group Company,
any of the authorised but unissued or unauthorised share capital or any
other security of any Group Company, and there is no outstanding
security of any kind convertible or exchangeable into any such share
capital of any Group Company.
4. SUBSIDIARIES. Other than the Subsidiary, the Company does not have any
subsidiary which it, directly or indirectly, owns or in which it,
directly or indirectly, has the power to vote shares of any capital
stock or other ownership interests having ordinary voting power to
elect a majority or the directors of such corporation, or other persons
performing similar functions for such entity. All of the shares in the
Subsidiary are duly authorised, validly issued and fully paid. There is
no other class of share capital or other ownership interests of the
Subsidiary authorised or outstanding. The Company owns, legally and
beneficially, such proportion of the issued and paid-up capital of the
Subsidiary free and clear from all and any Encumbrances together with
all rights and benefits attaching thereto as at the Completion Date and
no other person shall have any rights of pre-emption over the shares of
the Subsidiary.
5. TRANSACTIONS WITH AFFILIATES. All transactions between any member of
the Group and its respective Affiliates have been on an arms' length
basis on terms fair to such member of the Group.
6. CORPORATE RECORDS. The Vendors have delivered to the Purchaser true and
complete and certified copies of the Memorandum and Articles of
Association of the Company (or other constitutional documents), and the
Memorandum and Articles of Association (or other constitutional
documents) of the Subsidiary as in effect on the date hereof. The
minute books or comparable records of each Group Company which have
been made available to the Purchaser for its inspection contain true
and complete records in all material respects of all meetings and
consents in lieu of meeting of the board of directors or comparable
persons (and any committee thereof) of such Group Company and their
respective shareholders, since the time of its organisation and
accurately reflect all material transactions referred to in such
minutes and consents in lieu of meeting. The records of shareholdings
or comparable records of each Group Company which have been made
available to the Purchaser for its inspection are true and complete in
all material respects.
7. FINANCIAL STATEMENTS. All audited financial statements of each Group
Company, which have been delivered to the Purchaser, fairly present the
financial position of the Company and the Group as at Group Balance
Sheet Date and the results of operations of the Company and the Group
for such period and, all such financial statements have been prepared
in accordance with generally accepted international accounting
principles consistently applied for the periods covered thereby.
19
8. CONDITION OF GROUP. There has not been any condition or event that has
or may have a Material Adverse Effect on any Group Company or the Group
since the Group Balance Sheet Date.
9. TAXES.
(a) All tax returns, statements, reports and forms required to be
filed with any taxing authority on or before the Completion
Date with respect to any period ending, under applicable law,
on or before the Completion Date by, or with respect to, any
Group Company have been filed or will be filed on or before
the Completion Date in accordance with all applicable Laws.
(b) Each of the Group Companies has timely paid, withheld or made
provision for all taxes shown to be due on the returns that
will be filed on or before the Completion Date.
(c) There is no action, suit, proceeding, investigation, audit or
claim now proposed or pending against or threatened, with
respect to any Group Company in respect of any tax obligation.
(d) There are no Liens for taxes upon the assets of any Group
Company.
10. COMPLIANCE WITH LAWS. None of the Group Companies is in violation of
any Orders or any applicable Laws or received notice that any such
violation is being or may be alleged.
11. CLAIMS AND PROCEEDINGS. There are no outstanding Orders of any
Governmental Body against or involving any of the Group Companies. To
the best of the Vendors' knowledge and belief, there are no actions,
suits, claims or legal, administrative or arbitral proceedings or
investigations (collectively, "CLAIMS") (whether or not the defence
thereof or liabilities in respect thereof are covered by insurance)
instituted against or involving any of the Group Companies or any of
their respective properties. To the best of the Vendors' knowledge and
belief, there are no Claims instituted that would give rise to any
right of indemnification on the part of any director or officer of any
of the Group Companies or the heirs, executors or administrators of
such director or officer, against any of the Group Companies.
12. RECEIVABLES. All accounts and notes receivable outstanding or
subsisting on the Group Balance Sheet Date are reflected on the Company
Balance Sheet, and all accounts and notes receivable arising subsequent
to the Group Balance Sheet Date:
(a) have arisen in the ordinary course of business of the Group
Companies; and
(b) subject only to a reserve for bad debts computed in a manner
consistent with past practice and reasonably estimated to
reflect the probable results of collection, have been
collected or are collectible in the ordinary course of
business of the Group Companies in the aggregate recorded
amounts thereof in accordance with their terms.
14. TANGIBLE PROPERTY. The facilities, machinery, equipment, furniture,
leasehold improvements, fixtures, vehicles, structures, any related
capitalised items and other tangible property material to the business
of the Group Companies are in satisfactory operating condition and
repair, subject to continued repair and replacement in accordance with
past practice, and are suitable for their intended use.
15. TITLE TO PROPERTIES. The Group Companies own outright and has good and
marketable title to all of its properties and assets, including,
without limitation, all of the assets reflected on the Group Balance
Sheet, in each case free and clear of any Lien (save for Liens
described in the notes to the Balance Sheet of the Company). The
properties and assets of the Group described in the Group Balance Sheet
are the only properties or assets required for the Group Companies to
carry on their respective businesses as now operated and as
contemplated, and as such businesses has been represented to the
▇▇▇▇▇▇▇▇▇.
▇▇
▇▇. LIABILITIES. As at the Group Balance Sheet Date, to the best of the
knowledge and belief of the Vendors, none of the Group Companies has
any direct or indirect indebtedness or liability (whether primary or
secondary) of a kind required by generally accepted accounting
principles to be set out on a financial statement or in the notes
thereto (the "LIABILITIES") that were not fully and adequately
reflected or reserved against on the Balance Sheet of the Company. None
of the Group Companies has, except in the ordinary course of business,
incurred any Liabilities since the Group Balance Sheet Date.
17. INSURANCE. All insurance policies held by or on behalf of the each
Group Company are valid and binding in accordance with their terms, are
in full force and effect, and insure against risks and liabilities to
an extent and in a manner customary in the industry in which the
relevant Group Company operates. All premiums have been paid in full.
None of the Group Companies has received any notice from any of its
insurance carriers that any insurance premiums will be materially
increased in the future or that any insurance coverage will not be
available in the future on substantially the same terms as now in
effect.
18. KEY EMPLOYEES. Each Group Company has in relation to each of the Key
Employees, complied with in all material respects with all obligations
imposed on it by all statutes, regulations and codes of conduct and
practice relevant to the relations between it and the said Key
Employees and has maintained current adequate and suitable records
regarding the service of each of them.
19. POTENTIAL CONFLICTS OF INTERESTS. To the best of the knowledge and
belief of the Vendors, no officer or director of the Company and no
entity controlled by one or more of the foregoing:
(a) owns, directly or indirectly, any interest in or is an
officer, director, employee or consultant of, any person which
is, or is engaged in business as, a competitor, lessor,
lessee, supplier, distributor, sales agent or customer of any
of the Group Companies provided that nothing in this paragraph
(a) shall prohibit any officer or Director from owning, or
having any direct or indirect interest, in any real property
in any country or in any person which is engaged in any
business involving real property;
(b) owns, directly or indirectly, in whole or in part, any
property that any of the Group Companies uses in the conduct
of its business; or
(c) has any cause of action or other claim whatsoever against, or
owes any amount to, any of the Group Companies.
20. FULL DISCLOSURE. Subject to any and all restrictions imposed by
operation of any relevant laws and regulations, all Documents delivered
by or on behalf the Vendors in connection with this Agreement, the due
diligence conducted by the Purchaser and its advisors on the Group
Companies pursuant to Clause 3.1(a) and any Contemplated Transactions
are true, complete and accurate in all material respects. No
representation or warranty in connection with any of the Group
Companies contained in this Agreement, and no Document furnished by or
on behalf of the Vendors to the Purchaser pursuant to this Agreement or
in connection with any Contemplated Transactions, contains an untrue
statement of a material fact or an omission of a material fact. The
Vendors have fully and accurately disclosed to the Purchaser all facts
material to the business conducted or proposed to be conducted by each
of the Group Companies and as such business has been represented to the
Purchaser or its advisors.
21
SCHEDULE 3
----------
PURCHASER WARRANTIES
--------------------
1. DUE INCORPORATION AND AUTHORITY. The Purchaser is a company duly
organised and validly existing under the laws of its jurisdiction of
incorporation and has all requisite corporate power and lawful
authority to own, lease and operate its properties and to carry on its
business.
2. AUTHORITY TO EXECUTE AND PERFORM AGREEMENT. The Purchaser has the full
legal right and power and all authority and approvals required to
execute and deliver this Agreement and to perform fully its respective
obligations hereunder. This Agreement has been duly authorised,
executed and delivered by the Purchaser and constitutes valid and
binding obligations of the Purchaser enforceable in accordance with its
terms.
3. NO BREACH. The execution, delivery and performance of this Agreement by
the Purchaser and the consummation of any of the Contemplated
Transactions will not:
(a) violate any provision of the Memorandum and Articles of
Association (or other constitutional documents) of the
Purchaser;
(b) require the approval or consent of any Governmental Body or
the approval or consent of any other person, other than as set
out in Clauses 3.1(c);
(c) conflict with or result in any breach or violation of any of
the terms and conditions of, or constitute (or with notice or
lapse of time or both constitute) a default under, any
applicable Law or Order or any Contract to which the Purchaser
is a party or by or to which the Purchaser is or its
respective shares are bound or subject;
(d) violate or result in the revocation or suspension of any
Permit issued or granted to the Purchaser; or
(e) result in the creation of any Lien on the shares issued by the
Purchaser or any property of the Purchaser.
4. AUTHORITY TO ISSUE AND ALLOT CONSIDERATION SHARES. The Consideration
Shares when allotted and issued shall be free and clear from all and
any Encumbrances together with all rights and benefits attaching
thereto as at the Completion Date and no other person has or shall have
any rights of pre-emption over the Consideration Shares.
5. SHARE CAPITAL. As at the date hereof, the Purchaser's issued and
paid-up share capital is S$10,912,610.17 comprising 327,062,579
ordinary shares. All of the shares issued are duly authorised, validly
issued and fully paid. There is no other class of share capital or
other ownership interests of the Purchaser authorised or outstanding.
6. OPTION OR OTHER RIGHTS. Other than this Agreement and any Contemplated
Transactions, there is no outstanding right, subscription, warrant,
call, unsatisfied pre-emptive right, option or other agreement of any
kind to purchase or otherwise to receive from the Purchaser, any of the
authorised but unissued or unauthorised share capital or any other
security of the Purchaser, and there is no outstanding security of any
kind convertible or exchangeable into any such share capital of the
Purchaser.
7. SUBSIDIARIES. The Purchaser has no subsidiary which the Purchaser,
directly or indirectly, owns or in which the Purchaser, directly or
indirectly, has the power to vote shares of any capital stock or other
ownership interests having ordinary voting power to elect a majority or
the directors of such corporation, or other persons performing similar
functions for such entity.
8. TRANSACTIONS WITH AFFILIATES. All transactions between the Purchaser
and their respective Affiliates have been on an arms' length basis on
terms fair to the Purchaser.
22
9. CORPORATE RECORDS. The Purchaser has delivered to the Vendors true and
complete and certified copies of its Memoranda and Articles of
Association (or other constitutional documents as in effect on the date
hereof. The minute books or comparable records of the Purchaser which
have been made available to the Vendors for his inspection contain true
and complete records in all material respects of all meetings and
consents in lieu of meeting of the board of directors or comparable
persons (and any committee thereof) of the Purchaser and their
respective shareholders, since the time of its organisation and
accurately reflect all material transactions referred to in such
minutes and consents in lieu of meeting. The records of shareholdings
or comparable records of the Purchaser which have been made available
to the Vendors for inspection are true and complete in all material
respects.
10. FINANCIAL STATEMENTS. All audited financial statements of the
Purchaser, which have been delivered to the Vendors, fairly present the
financial position of the Purchaser as at the Financial Year End and
the results of operations of the Purchaser for such period and, all
such financial statements have been prepared in accordance with
generally accepted international accounting principles consistently
applied for the periods covered thereby.
11. CONDITION OF PURCHASER. There has not been any condition or event that
has or may have a material adverse effect on the Purchaser since the
Financial Year End.
12. TAXES.
(a) All tax returns, statements, reports and forms required to be
filed with any taxing authority on or before the Completion
Date with respect to any period ending, under applicable law,
on or before the Completion Date by, or with respect to, the
Purchaser have been filed or will be filed on or before the
Completion Date in accordance with all applicable Laws.
(b) The Purchaser has timely paid, withheld or made provision for
all taxes shown to be due on the returns that will be filed on
or before the Completion Date.
(c) There is no action, suit, proceeding, investigation, audit or
claim now proposed or pending against or threatened, with
respect to the Purchaser in respect of any tax obligation.
(d) There are no Liens for taxes upon the assets of the Purchaser.
13. COMPLIANCE WITH LAWS. The Purchaser is not in violation of any Orders
or any applicable Laws or received notice that any such violation is
being or may be alleged.
14. CLAIMS AND PROCEEDINGS. There are no outstanding Orders of any
Governmental Body against or involving the Purchaser. To the best of
the knowledge and belief of the Purchaser, there are no Claims (whether
or not the defence thereof or liabilities in respect thereof are
covered by insurance) instituted against or involving the Purchaser, or
any of its respective properties. To the best of the knowledge and
belief of the Purchaser, there are no Claims instituted that would give
rise to any right of indemnification on the part of any director or
officer of the Purchaser, or the heirs, executors or administrators of
such director or officer, against the Purchaser.
15. RECEIVABLES. All accounts and notes receivable outstanding or
subsisting on the Financial Year End are reflected on the Purchaser
Balance Sheet, and all accounts and notes receivable arising subsequent
to Financial Year End:
(a) have arisen in the ordinary course of business of the
Purchaser; and
(b) subject only to a reserve for bad debts computed in a manner
consistent with past practice and reasonably estimated to
reflect the probable results of collection, have been
collected or are collectible in the ordinary course of
business of the Purchaser in the aggregate recorded amounts
thereof in accordance with their terms.
23
16. TANGIBLE PROPERTY. The facilities, machinery, equipment, furniture,
leasehold improvements, fixtures, vehicles, structures, any related
capitalised items and other tangible property material to the business
of the Purchaser are in satisfactory operating condition and repair,
subject to continued repair and replacement in accordance with past
practice, and are suitable for their intended use.
17. TITLE TO PROPERTIES. The Purchaser owns outright and has good and
marketable title to all of its properties and assets, including,
without limitation, all of the assets reflected on the Purchaser
Balance Sheet in each case free and clear of any Lien (save for Liens
described in the notes to the Purchaser Balance Sheet).
18. LIABILITIES. As at the Financial Year End, to the best of the knowledge
of the Purchaser, the Purchaser has no direct or indirect Liabilities
that were not fully and adequately reflected or reserved against on the
Purchaser Balance Sheet. The Purchaser has not, except in the ordinary
course of business, incurred any Liabilities since the Purchaser
Balance Sheet.
19. INSURANCE. All insurance policies held by or on behalf of the Purchaser
are valid and binding in accordance with their terms, are in full force
and effect, and insure against risks and liabilities to an extent and
in a manner customary in the industry in which the Purchaser operates.
All premiums have been paid in full. The Purchaser has not received any
notice from any of its insurance carriers that any insurance premiums
will be materially increased in the future or that any insurance
coverage will not be available in the future on substantially the same
terms as now in effect.
20. KEY EMPLOYEES. The Purchaser has in relation to each of its Key
Employees, complied in all material respects with all obligations
imposed on it by all statutes, regulations and codes of conduct and
practice relevant to the relations between it and the said Key
Employees and has maintained current adequate and suitable records
regarding the service of each of them.
21. POTENTIAL CONFLICTS OF INTERESTS. To the best of the knowledge and
belief of the Purchaser, no officer or director of the Purchaser and no
entity controlled by one or more of the foregoing:
(a) owns, directly or indirectly, any interest in or is an
officer, director, employee or consultant of, any person which
is, or is engaged in business as, a competitor, lessor,
lessee, supplier, distributor, sales agent or customer of the
Purchaser;
(b) owns, directly or indirectly, in whole or in part, any
property that the Purchaser uses in the conduct of its
business; or
(c) has any cause of action or other claim whatsoever against, or
owes any amount to, the Purchaser.
22. FULL DISCLOSURE. All Documents delivered by or on behalf of the
Purchaser in connection with this Agreement, the due diligence
conducted by the Vendors on the Purchaser and the Purchaser
Subsidiaries pursuant to Clause 3.1(a) and any Contemplated
Transactions are true, complete and accurate in all material respects.
No representation or warranty in connection with the Purchaser
contained in this Agreement, and no Document furnished by or on behalf
of the Purchaser to the Vendors pursuant to this Agreement or in
connection with any Contemplated Transactions, contains an untrue
statement of a material fact or an omission of a material fact. The
Purchaser has fully and accurately disclosed to the Vendors all facts
material to the business conducted or proposed to be conducted by the
Purchaser and as such business has been represented to the Vendors and
his advisors.
24
EXECUTION CLAUSES
-----------------
THE PURCHASER
-------------
Signed by __________________________________)
for and on behalf of )
▇▇▇▇▇▇ INTERNATIONAL )
GROUP LTD. )
in the presence of )
_______________________________
Name:
Passport No.:
THE VENDORS
Signed by __________________________________)
for and on behalf of )
AMARU HOLDINGS LIMITED )
in the presence of )
_______________________________
Name:
Passport No.:
Signed by CHUA ▇▇▇▇▇ HIN )
in the presence of )
_______________________________
Name:
Passport No.:
Signed by Gay ▇▇▇▇ ▇▇▇▇▇▇ on behalf )
of CHEW ▇▇▇ ▇▇▇▇ by Power Attorney )
dated 14 January 2007 )
in the presence of )
_______________________________
Name:
Passport No.:
25
Signed by GAY ▇▇▇▇ ▇▇▇▇▇▇ )
in the presence of )
_______________________________
Name:
Passport No.:
Signed by ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ HIN )
in the presence of )
_______________________________
Name:
Passport No.:
26