Exhibit 99.2
CONFORMED COPY
AMENDED AND RESTATED
SHAREHOLDERS AGREEMENT
December 22, 2000
among
CHASE ASIA INVESTMENT PARTNERS II (Y), LLC
ASIA OPPORTUNITY FUND, L.P.,
CO-INVESTORS LISTED HEREIN,
QPL INTERNATIONAL HOLDINGS LIMITED,
THE INDUSTRIAL INVESTMENT COMPANY LIMITED,
QPL (US) INC.
and
ASAT HOLDINGS LIMITED
TABLE OF CONTENTS
Page
ARTICLE 1.....................................................................3
DEFINITIONS...................................................................3
1.1 Definitions...........................................................3
1.2 Construction..........................................................6
ARTICLE 2.....................................................................7
CORPORATE GOVERNANCE..........................................................7
2.1 Composition of the Board..............................................7
2.2 Removal...............................................................8
2.3 Vacancies.............................................................9
2.4 Meetings..............................................................9
2.5 Action by the Board..................................................10
2.6 Appointment of Auditors..............................................10
2.7 Necessary Actions; Avoidance of Conflict.............................11
2.8 Subsidiary Directors.................................................11
2.9 Remuneration.........................................................11
ARTICLE 3....................................................................11
RESTRICTIONS ON TRANSFER.....................................................11
3.1 General..............................................................11
3.2 Legend on Share Certificates.........................................11
3.3 Permitted Transferees................................................12
ARTICLE 4....................................................................12
RIGHT OF FIRST OFFER; TAG ALONG RIGHTS; DRAG ALONG RIGHTS....................12
4.1 Right of First Offer.................................................12
4.2 Tag Along Rights.....................................................14
4.3 Drag Along Rights; Mandatory Right of First Refusal..................16
4.4 CITIC Share Charge ..................................................19
4.5 Investors Charge.....................................................20
4.6 Improper Transfer....................................................20
4.7 Cooperation upon Transfer............................................20
ARTICLE 5....................................................................20
CONFIDENTIALITY; NON-COMPETITION.............................................20
5.1 Confidentiality......................................................21
5.2 Non-Competition by QPL...............................................22
5.3 Non-Competition by Investors.........................................22
5.4 Definitions..........................................................23
ARTICLE 6....................................................................23
QPL BANKRUPTCY; INDEMNIFICATION..............................................23
6.1 QPL Bankruptcy Event.................................................23
6.2 Indemnification......................................................24
ARTICLE 7....................................................................24
MISCELLANEOUS................................................................24
7.1 Ong Lawsuit..........................................................24
7.2 Entire Agreement.....................................................24
7.3 Binding Effect; Benefit..............................................25
7.4 Assignment...........................................................25
7.5 Amendment; Waiver; Termination.......................................25
7.6 Notices..............................................................26
7.7 Section Headings.....................................................26
7.8 Counterparts.........................................................26
7.9 Severability.........................................................26
7.10 Applicable Law.......................................................26
7.11 Specific Enforcement.................................................26
7.12 Submission to Jurisdiction...........................................27
7.13 Agent for Service....................................................27
7.14 CITIC Share Charge and Facility......................................27
7.15 QPL Obligations......................................................27
ANNEX A - List of Co-Investors
ANNEX B - Form of Deed of Adherence
ANNEX C - Addresses for Notice Under the Shareholders Agreement
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AMENDED AND RESTATED
SHAREHOLDERS AGREEMENT
AGREEMENT (the "Agreement") dated December 22, 2000 among CHASE ASIA
INVESTMENT PARTNERS II (Y), LLC, a limited liability company formed under the
laws of Delaware ("CAIP"), ASIA OPPORTUNITY FUND, L.P., an exempted limited
partnership formed under the laws of the Cayman Islands ("AOF"), the
CO-INVESTORS listed in Annex A (the "Co-Investors" and together with CAIP and
AOF, the "Investors"), THE INDUSTRIAL INVESTMENT COMPANY LIMITED, a company
formed under the laws of the Cayman Islands ("TIIC"), QPL INTERNATIONAL HOLDINGS
LIMITED, a corporation formed under the laws of Bermuda, QPL (US) INC. (formerly
Worltek International, Ltd.), a California corporation ("QPL US") and ASAT
HOLDINGS LIMITED, a company formed under the laws of the Cayman Islands
("ASAT").
In consideration of the covenants and agreements herein contained, the
parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
1.1 Definitions. Terms defined in the Subscription Agreement are
incorporated herein unless otherwise defined herein. The following terms, as
used herein, have the following meanings:
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under common control with
such Person (and including a Subsidiary). No Shareholder shall be deemed an
Affiliate of any other Shareholder solely by reason of any investment in ASAT.
For the purpose of this definition, the term "control" (including with
correlative meanings, the terms "controlling", "controlled by" and "under common
control with"), as used with respect to any Person, shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of voting
securities or by contract or otherwise.
"ASAT HK" means ASAT Limited, a corporation incorporated under the
laws of Hong Kong which is a Subsidiary of ASAT.
"Board" means the board of directors of ASAT.
"Business Day" means a day other than Saturday, Sunday or any day on
which banks located in Hong Kong are authorized or obligated to close.
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"CITIC" means CITIC Ka Wah Bank Limited.
"CITIC Share Charge" means the share charge to secure the liabilities
under the Facility, to be entered into between The Industrial Investment Company
Limited ("TIIC") and CITIC in relation to the share charge over 30 million
ordinary Shares held by TIIC and such further Shares as may be required under
the top-up requirement thereunder from time to time up to a maximum of ten per
cent of the issued Shares of ASAT from time to time (the top-up Shares not being
subject to the Charge Over Shares dated October 29, 1999 between QPL US, TIIC,
Standard Chartered Bank and AOF).
"EBITDA" means, for a specified period, the consolidated earnings
before interest, income taxes, depreciation and amortization, excluding
non-recurring or exceptional items and extraordinary gains and losses, of ASAT
and its consolidated Subsidiaries, as derived from the audited financial
statements of ASAT prepared in accordance with US GAAP as provided in Section
2.5(b).
"Facility" means the stand-by letter of credit facility, dated
December ____, 2000, between QPL and CITIC.
"Fair Market Value" means on any date the average of the Closing Price
of the American Depositary Receipts representing Shares (the "ADRs") as quoted
on the NASDAQ National Market System for each of the 5 consecutive trading days
before such date divided by the number of Shares represented by one such ADR.
"Closing Price" for any trading day means the last reported sale price for the
Shares on that day or, if no reported sales take place on such day, the average
of the closing bid and offer prices, in either case as quoted on the NASDAQ
National Market System.
"Financial Debt" means indebtedness for borrowed money, deferred
purchase price obligations, conditional sales obligations, capital lease
obligations, purchase money obligations and finance and capital leases,
guarantees thereof and other direct or contingent monetary obligations. For the
avoidance of doubt, "Financial Debt" does not include trade payables or
operating leases incurred in the ordinary course by business.
"Fund Affiliates" means, as to any Investor, (i) any of its general
partners, limited partners, fund managers and funds managed by its fund
managers, officers (including vice presidents), general partners and Affiliates
thereof, and, after the Initial Public Offering, any employee thereof, and (ii)
the spouses, lineal descendants and heirs of individuals referred to in clause
(i) and trusts controlled by or for the benefit of such individuals.
"Initial Public Offering" means the first Public Offering of equity
securities of ASAT, ASAT HK or other Subsidiary of ASAT (unless otherwise
specified) upon the consummation of which such securities are listed on Nasdaq
or a internationally recognized securities exchange, including without
limitation The Stock Exchange of Hong Kong Limited.
"Nasdaq" means the National Association of Securities Dealers, Inc.
Automated Quotation System's National Market.
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"Net Debt" means all consolidated Financial Debt of the ASAT
Companies outstanding at the time of determination, net of cash held by the ASAT
Companies at such time.
"Percentage Ownership" means, with respect to any Shareholder,
an amount equal to the aggregate number of Shares registered in the name of such
Shareholder divided by the total number of Shares owned by the Shareholders.
"Permitted Transferee" means (a) with respect to each
Investor: (i) AOF, CAIP and any of their respective Fund Affiliates, (ii) any of
its Fund Affiliates, and (iii) any Permitted Transferee of its Permitted
Transferees; and (b) with respect to QPL: any wholly owned Subsidiary of QPL.
"Person" means an individual, corporation, partnership,
association, trust or other entity or organization, including a government or
political subdivision or an agency or instrumentality thereof.
"Public Offering" means, in the case of an offering in the
United States, an underwritten public offering of equity securities of ASAT or
ASAT HK pursuant to an effective registration statement under the U.S.
Securities Act of 1933, as amended, and, in the case of an offering in any other
jurisdiction, a widely distributed underwritten offering of equity securities of
ASAT or ASAT HK in which both retail and institutional investors are eligible to
buy in accordance with the securities laws of such jurisdiction.
"Public Sale" means any Sale of Shares (i) in a Public
Offering or (ii) on Nasdaq or on any other internationally recognized securities
exchange on which the Shares are listed following the Initial Public Offering,
provided that in either case such Sale is not directed to a particular purchaser
or group of purchasers with whom the Shareholder has an understanding, agreement
or arrangement (written or otherwise) regarding such Sale. For the avoidance of
doubt, Public Sale shall include any Transfer by QPL to CITIC or any nominee of
CITIC which is to be the holder of such Shares on CITIC's behalf or any deposit
of Shares into a depositary, in each case pursuant to or substantially
contemporaneous with the enforcement of the CITIC Share Charge for the issuance
and substantially contemporaneous Public Sale of equivalent American depositary
shares representing such Shares.
"QPL" means QPL International Holdings Limited, a corporation
formed under the laws of Bermuda and unless otherwise specified shall include,
jointly and severally with QPL International Holdings Limited, The Industrial
Investment Company Limited, QPL (US) Inc. and any direct or indirect wholly
owned Subsidiary of QPL that has a direct or indirect interest in the Shares.
"Required Drag Along Sale Price" means, for purposes of
Section 4.3, a per Share price of at least six times EBITDA for the period of
the last four full fiscal quarters preceding the date of the Right of First
Refusal Notice less Net Debt at the end of such period (as calculated by ASAT's
auditors based on ASAT's latest available management accounts) divided by the
total number of issued and outstanding Shares on a fully diluted basis (taking
into account
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the Shares to be issued upon exercise of the Warrants and the Shares to be
issued to employees of any ASAT Company pursuant to an exercise of stock options
granted to such employee) at the time of such determination.
"Sell" means to Transfer, except by way of pledge, charge,
hypothecation or other grant of a security interest or making of any other
encumbrance, and "Sale" and "Sales" shall have correlative meanings.
"Shareholder" means each registered shareholder of ASAT that
is a party to this Agreement, whether in connection with the execution and
delivery hereof as of the date hereof, pursuant to Section 7.4 or otherwise.
"Shares" means ordinary shares in ASAT with voting rights, par
value US$0.01 per share, including any subdivisions, combinations, splits or
reclassifications thereof.
"Subscription Agreement" means the amended and restated
subscription agreement dated as of October 29, 1999 entered into among the
Investors, QPL, Bring Luck, TIIC, QPL US (formerly Worltek International, Ltd.),
ASAT HK and ASAT, pursuant to which the Investors, TIIC and QPL US and agreed
severally and not jointly and severally to subscribe for, inter alia, Shares.
"Subsidiary" means, with respect to any Person, any entity of
which securities or other ownership interests having ordinary voting power to
elect a majority of the board of directors or other such persons performing
similar functions are at the time directly or indirectly owned by such Person.
"Third Party" means a prospective purchaser of Shares in an
arm's-length transaction from a Shareholder where such purchaser is not a
Permitted Transferee of such Shareholder.
"Transfer" means to sell, exchange, assign, pledge, charge,
grant a security interest, make a hypothecation, gift or other encumbrance, or
entering into any contract therefor, any voting trust or other agreement or
arrangement with respect to the transfer of voting rights or any other legal or
beneficial interest in any of the Shares, creating any other claim thereto or to
make any other transfer or disposition whatsoever, whether voluntary or
involuntary, affecting the right, title, interest or possession in, to or of
such Shares, and "Transfer", "Transfers" and "Transferred" shall have
correlative meanings.
1.2 Construction. Unless the context of this Agreement
otherwise requires, (i) words of any gender include each other gender; (ii)
words using the singular or plural number also include the plural or singular
number, respectively; (iii) the terms "hereof," "herein," "hereby" and
derivative or similar words refer to this entire Agreement; (iv) the terms
"Article" or "Section" refer to the specified Article or Section of this
Agreement; and (v) the phrase "ordinary course of business" refers to the
business of the ASAT Companies taken as a whole or each ASAT Company, as the
context requires. Whenever this Agreement refers to a number of
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days, such number shall refer to calendar days unless Business Days are
specified.
ARTICLE 2
CORPORATE GOVERNANCE
2.1 Composition of the Board. (a) The Board shall consist of
nine directors. Subject to Section 2.1(b), AOF shall have the right to appoint
three directors and QPL shall have the right to appoint three directors, one of
whom initially shall be ▇▇. ▇.▇. ▇▇. The remaining three directors shall be
Independent Directors and initially shall be ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ and
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇. Subject to Section 2.1(b), AOF shall select up to three
Independent Directors, and QPL shall nominate such persons, for recommendation
to the Board for approval and appointment by the Board in accordance with the
Articles of Association of ASAT and this Agreement, unless QPL reasonably
concludes that such person is not professionally qualified to serve as an
Independent Director, in which case, AOF shall select and QPL shall nominate
another person as the Independent Director on the same basis.
(b) Save as otherwise provided in this Section 2.1(b), if at
any time QPL or the Investors decrease their respective direct or indirect
ownership of Shares, Section 2.1(a) shall be deemed permanently amended so that
the number of directors that QPL or the Investors (as the case may be) may
appoint, select or nominate shall be reduced as set forth in the following
table:
Percentage of Number of
Outstanding Shares Number of Independent
Owned by QPL or the Investors Directors Directors
----------------------------- --------- ---------
more than 20% 3 3
more than 10% but equal to or less than 20% 2 2
more than 5% but equal to or less than 10% 1 1
equal to or less than 5% 0 0
For the avoidance of doubt, it is understood that AOF may retain its right of
selection of an Independent Director under Section 2.1(a) even if QPL loses a
right of a nomination of such Independent Director as a result of this Section
2.1(b).
(c) Following issue of Shares upon exercise of the Warrants or
issue of Shares to employees of any ASAT Company pursuant to an exercise of
stock options granted to such employee, the percentage thresholds referred to in
Section 2.1(b) above shall be reduced to reflect the dilutive effect or
reduction of the numbers of Shares held by QPL or the Investors as a result of
such event.
(d) Upon losing the right to appoint a director pursuant to
Section 2.1(b), AOF or QPL (as the case may be) shall cause the relevant number
of directors which it appointed under Section 2.1(a) to resign from the Board
unless a majority of the Board (excluding the resigning director) and a majority
of the Independent Directors determine otherwise.
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(e) Each of QPL and AOF may designate one alternate director
(other than the Independent Directors) who shall receive all materials supplied
to directors and shall be entitled to attend all meetings of the Board and
committees thereof. The Shareholders shall procure that the Directors appointed
by any Shareholder shall not be required to hold any qualification share nor
shall they be subject to retirement by rotation.
(f) As used herein, "Independent Director" shall mean a person
who (i) at the time of election is not (A) a direct or indirect legal or
beneficial owner of equity securities in any ASAT Company in an amount greater
than 5% of the total outstanding equity securities of such ASAT company or (B)
employee, officer or director of any ASAT Company or of any Affiliate of any
ASAT Company (other than as an Independent Director) and (ii) is nominated as an
Independent Director by the Board, provided that for so long as equity
securities of ASAT are quoted on Nasdaq at least three Independent Directors
shall meet the then current requirements for independent directors as set forth
in the rules of the National Association of Securities Dealers, Inc. Each
Shareholder entitled to vote for the election of directors to the Board agrees
that it will vote its Shares and take all other necessary action (including in
order to satisfy any quorum requirement) in order to ensure that the composition
of the Board is as set forth in this Section 2.1.
2.2 Removal. Each Shareholder agrees that if, at any time, it is
then entitled to vote for the removal of directors of ASAT, it will not vote any
of its Shares in favor of the removal of any director who shall have been
selected or appointed pursuant to Section 2.1 unless (a) such removal shall be
for Cause, (b) the director chosen by QPL or AOF (as the case many be) to resign
in accordance with Section 2.1(b) refuses to resign, (c) the Persons entitled to
select or appoint such director shall have consented to such removal in writing
or (d) such director fails to take any action necessary or appropriate to
implement the purpose of this Agreement or takes any action that is contrary to
or frustrates the purpose of this Agreement and all Shareholders (other than the
Shareholder entitled to select or appoint such director) shall have consented to
such removal in writing, provided that with respect to the removal of an
Independent Director, such written consent must be obtained from both AOF and
QPL, such consent not to be unreasonably withheld or delayed. Removal for
"Cause" shall mean removal of a director because of (a) such director's willful
and continued failure to substantially perform his duties as a director of ASAT,
(b) such director's willful conduct which is significantly injurious to ASAT or
any Shareholder's investment in Shares, monetarily or otherwise, (c) such
director's being convicted or investigated in a criminal proceeding (other than
traffic violations and other minor offenses), (d) such director's being censured
or subject to equivalent action by any internationally recognized securities
exchange (including a pending proceeding), or (e) a petition under the
bankruptcy of insolvency laws of any jurisdiction is filed by or against, or a
receiver, or similar officer is appointed by a court for the business or
property of, such director, or any partnership in which he is or was a general
partner at or within two years before such date or any corporation or business
association of which he was an executive officer at or within two years before
such date. Upon appointment to the Board or any board of directors of a
Subsidiary of an ASAT Company, each director appointee (for avoidance of doubt,
this does not include the Independent Directors) shall agree to abide by the
terms of this Article 2 and shall deliver to ASAT a signed notice of resignation
with a blank date, which AOF or QPL (as the case may be)
8
may cause to be completed and become effective in each case in accordance with
the terms of this Agreement and the Articles of Association of ASAT.
2.3 Vacancies. (a) If a director appointed by a person
entitled under Section 2.1(a) to appoint such director shall cease to be a
director as a result of death, disability, retirement, resignation, removal
(with or without Cause) or otherwise, such person may appoint on the basis
provided in Section 2.1 another individual to fill such vacancy, provided such
vacancy shall be filled pursuant to Section 2.3(b) if such appointment would
result in such person having a number of appointees on the Board in excess of
the maximum number allotted to such person under Section 2.1(b).
(b) Notwithstanding anything to the contrary in the Articles
of Association of ASAT except as provided in Section 2.3(a), any vacancy arising
from the death, disability, retirement, resignation, removal (with or without
Cause) or otherwise of a director shall be filled by (i) a majority of the
directors present at a meeting of the Board and (ii) a majority of the
Independent Directors. Each Shareholder who has appointed a director pursuant to
Section 2.1 agrees to procure that its appointed directors will not vote in
favor of a nominee to fill such a vacancy unless a majority of the Independent
Directors have first voted in favor of such nominee. The Shareholders shall
cooperate in good faith with the Independent Directors to fill any vacancy of an
Independent Director seat so that there are at least three Independent Directors
on the Board.
(c) Notwithstanding anything to the contrary in the Articles
of Association of ASAT, with respect to any vacancy on the Board resulting from
a removal (with or without Cause) or from a resignation required under Section
2.1(d) or Section 6.1, the removed or resigning director shall not be entitled
to vote in the election of such director's successor and shall be not be counted
as attending the Board meeting at the time the Board elects such successor.
2.4 Meetings. The Board shall hold a regularly scheduled
meeting at least once every three calendar months, unless otherwise determined
by the Board but in no event less often than once every fiscal year. The
Shareholders entitled to vote Shares shall procure that notice in writing of not
less than 10 Business Days shall be given in respect of a meeting of directors
of ASAT or its Subsidiaries, unless all directors of ASAT consent to shorter
notice. Any director may convene a board meeting by prior notice in accordance
with Section 7.5. Board meetings shall be held in Hong Kong or at such other
location agreed by a majority of the Board, including, for so long as each is
entitled to appoint a director pursuant to Section 2.1, at least one director
appointed by QPL and one director appointed by AOF. Any director can participate
in a meeting of the directors of ASAT or its Subsidiaries by means of telephone
conference or similar communication equipment whereby all persons participating
in such meeting can hear each other. Participation in a meeting in such manner
shall be deemed to constitute presence in person at such meeting and shall be
taken into account for the purpose of a quorum and voting.
2.5 Action by the Board. (a) A quorum of the Board shall
consist of a majority of the total directors. If a quorum is not present within
60 minutes of the appointed time for a meeting, the meeting will automatically
be adjourned to the same place and at the same time the
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following week (or if such day is not a Business Day, at the same time on the
next following Business Day), and any four directors then present will
constitute a quorum. For so long as the Investors or QPL (as the case may be)
own at least 10% of Shares outstanding, the Shareholders agree not to take any
action (and will procure that all directors appointed by such Shareholder
pursuant to Section 2.1 will not take any action) at a meeting of the Board
unless at least one director appointed by AOF or QPL (as the case may be) is
present at the meeting.
(b) All actions of the Board shall require the affirmative
vote of at least a majority of the directors present at a duly convened meeting
of the Board at which a quorum is present, provided that, in the event there is
a vacancy on the Board and an individual has been nominated to fill such
vacancy, the first order of business shall be to fill such vacancy.
(c) The executive officers of ASAT shall submit to the Board,
and obtain their approval of, prior to the start of each fiscal year of ASAT, a
business plan (the "Business Plan") setting forth the annual budget and
operating plan of ASAT for such fiscal year. The Board shall receive quarterly
(no later than 45 days after the relevant fiscal quarter ends) and annual (no
later than 90 days after the relevant fiscal year ends) financial statements and
other appropriate reports concerning operations of ASAT and other matters
submitted to it. For the financial year ended April 30, 2000 and thereafter,
such quarterly and annual financial statements shall be prepared in accordance
with US GAAP and the annual financial statements shall be reported on by the
auditors selected pursuant to Section 2.6. ASAT shall also maintain a set of
statutory financial accounts prepared in accordance with HK GAAP, to the extent
required by any applicable law of Hong Kong. The first fiscal year after the
Closing Date shall end on April 30, 2000 unless all Shareholders otherwise
agree.
(d) The Board shall create an audit committee and may create
executive, compensation and other committees with such powers and duties as the
Board shall determine.
(e) The Shareholders entitled to vote Shares agree that the
provisions in ASAT's articles of association and in this Agreement regarding
voting by directors and shareholders shall apply equally to each ASAT Company as
if its name was substituted for ASAT throughout, and the Shareholders shall
procure that the Board shall not permit any Subsidiary or any ASAT Company to
engage in any transaction or matter unless in accordance with the relevant
provisions in ASAT's articles of association and this Agreement (other than a
transaction or matter involving exclusively other ASAT Companies or wholly owned
Subsidiaries thereof).
2.6 Appointment of Auditors. Each Shareholder entitled to vote
Shares agrees to vote its Shares, and each Shareholder who has appointed a
director pursuant to Section 2.1 agrees to procure that its appointed directors
will vote, to cause the Board to appoint as ASAT's auditors an internationally
recognized accounting firm selected by AOF and approved by QPL (such approval
not to be unreasonably withheld or delayed).
2.7 Necessary Actions; Avoidance of Conflict. Each Shareholder
shall, subject to applicable law, vote its Shares and take all actions
necessary, and each Shareholder who has appointed a director pursuant to Section
2.1 agrees to procure that its appointed directors will vote and take all action
necessary, to (a) implement the provisions of this Agreement and each of
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the other Transaction Agreements, (b) ensure compliance by such Shareholder with
its obligations under this Agreement and under each of the other Transaction
Agreements and (c) ensure that the Memorandum and Articles of Association of
ASAT (and the memorandum and articles of association, certificate of
incorporation, bylaws or other basic organizational documents of any of ASAT's
Subsidiaries) facilitate and do not at any time conflict with any provision of
this Agreement.
2.8 Subsidiary Directors. Subject to Sections 2.1 and 6.1, the
board of directors of each Subsidiary of ASAT or Subsidiary thereof shall
consist of an equal number of directors appointed by QPL and AOF, with no more
than three directors being appointed by QPL and AOF each, except that the board
of directors of ASAT HK shall be identical in size and members to the Board. QPL
and AOF shall cause their respective appointees to take all actions in
accordance with the directions of the Board. Such appointees may be removed and
vacancies on such boards shall be filled on the same basis as provided in
Sections 2.2 and 2.3.
2.9 Remuneration. No director on the Board (other than the
Independent Director) shall be entitled to any remuneration for serving in such
capacity except for reimbursement of out-of-pocket expenses in connection with
the performance of his duties as director and, if such director is otherwise an
employee or consultant of ASAT, remuneration received in such capacity.
ARTICLE 3
RESTRICTIONS ON TRANSFER
3.1 General.. No Shareholder will, directly or indirectly,
Transfer any Shares or any interest therein (or solicit any offers for the
Transfer thereof) unless such Transfer is in accordance with and permitted by
Articles 3 and 4. Without limitation of the foregoing, QPL shall not directly or
indirectly Transfer any equity or other ownership interests in or voting control
of any Affiliate of QPL that has any direct or indirect legal or beneficial
ownership of any Shares, other than to a wholly owned subsidiary of QPL.
Notwithstanding anything to the contrary in Section 3.1, QPL may pledge Shares
to the Investors pursuant to the charge agreement described in Section 4.5 and
as provided in Section 4.4.
3.2 Legend on Share Certificates. (a) In addition to any other
legend that may be required, each certificate for Shares owned by a Shareholder
shall bear a legend in substantially the following form:
"THIS SECURITY IS SUBJECT TO RESTRICTIONS ON TRANSFER AS SET
FORTH IN A SHAREHOLDERS AGREEMENT DATED AS OF JULY 14, 2000, A COPY OF
WHICH MAY BE OBTAINED UPON REQUEST FROM ASAT HOLDINGS LIMITED. NO SUCH
TRANSFER SHALL BE EFFECTIVE UNLESS AND UNTIL THE TERMS AND CONDITIONS
OF THE AFORESAID SHAREHOLDERS AGREEMENT HAVE BEEN COMPLIED WITH IN
FULL."
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(b) If any Shares cease to be subject to any restrictions on
Transfer set forth in this Agreement (including by way of Public Sale), ASAT
shall, upon the written request of the holder thereof, issue to such holder a
new certificate evidencing such shares without the legend required by Section
3.2(a) endorsed thereon.
3.3 Permitted Transferees. Notwithstanding anything in this
Agreement to the contrary, a Shareholder may Transfer any or all of its Shares
to one or more of its Permitted Transferees without the consent of the Board or
any other Shareholder (it being understood that such consent shall have deemed
to have been given) and without compliance with Sections 4.1, 4.2 and 4.3 if (a)
such Permitted Transferee shall have entered into a deed of adherence
substantially in the form attached as Annex B and (b) the Transfer to such
Permitted Transferee is not in violation of applicable securities laws.
Notwithstanding any such Transfer, the transferring Shareholder and its
Permitted Transferees shall be deemed to be a single Shareholder under this
Agreement. Following any Transfer of its Shares to a Permitted Transferee (other
than a Permitted Transferee referred to in clause (b)(ii) of the definition of
"Permitted Transferee"), QPL shall remain jointly and severally liable with such
Permitted Transferee. If any Permitted Transferee holding Shares Transferred to
it by a Shareholder pursuant to Section 3.3 shall no longer qualify as a
Permitted Transferee of such Shareholder, the Permitted Transferee shall return
the Shares to such Shareholder or to another Permitted Transferee of such
Shareholder in accordance with the Shareholder's instruction.
ARTICLE 4
RIGHT OF FIRST OFFER;
TAG ALONG RIGHTS;
DRAG ALONG RIGHTS
4.1 Right of First Offer. (a) Any Shareholder (the "Section
4.1 Seller") that desires to sell any of its Shares (other than a Sale (x) to a
Permitted Transferee as permitted by Section 3.3, (y) in a Public Sale, or (z)
in connection with a Transfer by QPL pursuant to Transfer of Shares referred to
in Section 4.5) shall provide each non-selling Shareholder written notice of its
desire to so Sell Shares (a "Right of First Offer Notice"). The Right of First
Offer Notice shall set forth the number of Shares which the Section 4.1 Seller
desires to Sell, the per share consideration to be received for the Shares and
any other proposed material terms and conditions relating to such Sale.
Notwithstanding the foregoing, CITIC shall not have any rights under, but it
nonetheless shall be bound by this Section 4.1, subject to Section 4.4(b),
provided that Section 4.1 shall not restrict any Transfer of Shares by way of
Public Sale.
(b) (i) The delivery of a Right of First Offer Notice shall
constitute an offer, which, subject to Section 4.4(b) below, shall be
irrevocable for 21 days (the "Right of First Offer Notice Period"), by the
Section 4.1 Seller to Sell to each non-selling Shareholder (each an "Offeree"
and collectively the "Offerees") the Shares subject to the Right of First Offer
Notice, for the per share price set forth in the Right of First Offer Notice and
on the terms and conditions set forth therein. Each Offeree shall have the
right, but not the obligation, to accept the offer set forth in the Right of
First Offer Notice to purchase all but not less than all of the Shares subject
12
thereto by giving a written notice of purchase (a "Section 4.1 Purchase Notice")
to the Section 4.1 Seller prior to the expiration of the Right of First Offer
Notice Period. Subject to Section 4.1(b)(ii), delivery of a Section 4.1 Purchase
Notice by an Offeree to the Section 4.1 Seller shall constitute a contract
between such Offeree and the Section 4.1 Seller for the purchase and Sale of the
Shares subject to the Right of First Offer Notice for the per share price set
forth in the Right of First Offer Notice and on the terms and conditions set
forth therein.
(ii) In the event more than one Offeree shall deliver a
Section 4.1 Purchase Notice to the Section 4.1 Seller prior to the expiration of
the Right of First Offer Notice Period, each such Section 4.1 Purchase Notice
shall constitute a separate contract between the Section 4.1 Seller and such
Offeree delivering a Section 4.1 Purchase Notice for the purchase and Sale of
Shares subject to the Right of First Offer Notice, at the per share price set
forth therein. The number of Shares subject to each such separate contract shall
be determined on a pro rata basis based upon the number of Shares owned by each
Offeree delivering a Section 4.1 Purchase Notice, or on such other basis as such
Offerees may agree. The aggregate number of Shares, and the aggregate purchase
price thereof, subject to all such contracts shall at all times equal the number
of Shares set forth in the Right of First Offer Notice and the purchase price
per share set forth therein multiplied by the number of Shares set forth
therein, respectively.
(c) The closing of any purchase and Sale of Shares between the
Section 4.1 Seller and any Offeree pursuant to this Section 4.1 shall take place
on the date designated by such Offeree within 30 days from the termination of
the Right of First Offer Notice Period; provided that if such purchase and Sale
of such Shares is subject to any prior approval or other consent required by
applicable law, regulation or stock exchange rule, the time period during which
the closing of such purchase and Sale may occur shall be extended (but not to
exceed 120 days in the aggregate) until the expiration of ten Business Days
after all such approvals and consents shall have been received. The parties
shall use reasonable efforts to obtain all such approvals and consents.
(d) If no Offerees deliver a Section 4.1 Purchase Notice in
accordance with Section 4.1(b) prior to the termination of the Right of First
Offer Notice Period, there shall commence a 90 day period during which the
Section 4.1 Seller shall have the right, subject to Section 4.2 (Tag Along
Rights) and Section 4.3 (Drag Along Rights), to enter into an agreement to Sell
all the Shares subject to the Right of First Offer Notice to a Third Party for a
per share price equal to at least the per share price set forth in the Right of
First Offer Notice and otherwise on terms and conditions not more favorable in
the aggregate to the purchaser than those set forth in the Right of First Offer
Notice.
(e) Any proposed Sale to a Third Party pursuant to this
Section 4.1: (i) shall be in compliance with all applicable laws, regulations
and stock exchange rules, including, without limitation, all securities laws,
and (ii) shall be consummated within 30 days from the termination of the Tag
Along Notice Period as defined in Section 4.2(b); provided that if the Sale of
such Shares is subject to any prior regulatory approval or consent, the time
period during which such Sale may be consummated may be extended (but not to
exceed 120 days in the aggregate from the date of execution of such agreement)
until the expiration of ten Business Days after all such approvals and consents
shall have been received. If the Section 4.1 Seller
13
does not consummate the Sale of the Shares subject to the Right of First Offer
Notice in accordance with the above time limitations, it may not thereafter Sell
such Shares except in compliance in full with all the provisions of this Section
4.1.
(f) Promptly after consummation of any Sale to a Third Party
pursuant to Section 4.1(e), the Section 4.1 Seller shall notify each non-selling
Shareholder of the consummation thereof and shall furnish such evidence of the
completion of such Sale and of the terms thereof as such Shareholder may
reasonably request, including, without limitation, evidence that the per share
price paid by such Third Party was equal to at least the per share price set
forth in the Right of First Offer Notice and otherwise on terms and conditions
not more favorable in the aggregate to such Third Party than those set forth in
the Right of First Offer Notice.
(g) All proposed Sales of Shares to a Third Party under
Section 4.1(d) shall also be subject to Sections 4.2 and 4.3. For avoidance of
doubt, the operation of Sections 4.2 and 4.3 do not require the selling
Shareholder to deliver a second Right of First Offer Notice under Section 4.1.
(h) Notwithstanding anything contained in this Section 4.1,
there shall be no liability on the part of the Section 4.1 Seller to any
non-Selling Shareholder if the Sale of Shares to a Third Party pursuant to this
Section 4.1 is not consummated for whatever reason. Any decision as to whether
to Sell Shares shall be at the sole and absolute discretion of the Section 4.1
Seller.
(i) QPL acknowledges and agrees that (1) if a Right of First
Offer Notice states that Permitted Transferees of the Shareholder issuing such
notice have priority to purchase all (but not less than all) Shares included in
such offer, then such Permitted Transferees have the right to accept such offer
to the exclusion of QPL (due to their status as Permitted Transferees); and (2)
if CAIP or AOF gives a Right of First Offer Notice that states its intention to
cause a Sale of all their Shares and all the Shares then owned by Co-Investors
to a Third Party if other Shareholders (including QPL) fail to purchase CAIP's
and AOF's Shares specified in such Right of First Offer Notice, then CAIP and
AOF may cause the Sale of the Co-Investors' Shares during the 90 day period
referred to in Section 4.1(d) at the same price per Share and on the same terms
specified in such Right of First Offer Notice with respect to CAIP's and AOF's
Shares without the Co-Investors' Shares being reoffered to QPL under this
Section 4.1.
4.2 Tag Along Rights. (a) Any Shareholder (the "Section 4.2
Seller") that proposes to Sell any of its Shares to a Third Party (other than a
Sale (w) to a Permitted Transferee as permitted by Section 3.3, (x) in a Public
Sale, or (y) by QPL to CITIC pursuant to a Charge Transfer or to a CITIC
Transferee at the instruction of CITIC pursuant to the CITIC Share Charge or by
CITIC in a direct sale to a CITIC Transferee, or (z) pursuant to a Transfer of
Shares referred to in Section 4.5) and that complied with Section 4.1 (a
"Section 4.2 Sale") shall provide written notice of such proposed Section 4.2
Sale to the non-selling Shareholders ("Tag Along Notice") and a copy of the
agreement pursuant to which the Section 4.2 Seller proposes to Sell such Shares
(the "Section 4.2 Agreement"). The Tag Along Notice shall identify the number of
Shares subject to the Section 4.2 Sale, the per share consideration for which
the
14
Section 4.2 Sale is proposed to be made (the "Section 4.2 Sale Price") and
all other material terms and conditions of the proposed Section 4.2 Sale.
Notwithstanding the foregoing, CITIC shall not have any rights under this
Section 4.2, nor shall it be bound by this Section 4.2
(b) Each non-selling Shareholder shall have the right and
option, exercisable as set forth below, to participate in the Section 4.2 Sale
for up to the number of Shares (the "Participating Shares") as constitute its
Tag Along Pro Rata Portion of the number of Shares subject to the Section 4.2
Sale, and the number of Shares which the Section 4.2 Seller is entitled to Sell
in the Section 4.2 Sale shall be reduced to the extent of the participation of
the non-selling Shareholders pursuant to this Section 4.2. "Tag Along Pro Rata
Portion" means, with respect to each non-selling Shareholder, at the time of the
Section 4.2 Sale, its Percentage Ownership. Each non-selling Shareholder that
desires to exercise such option shall provide the Section 4.2 Sellers with
written irrevocable notice within seven Business Days after the date the Tag
Along Notice is given (the "Tag Along Notice Period") and shall simultaneously
provide a copy of such notice to ASAT and the other non-selling Shareholders.
Such notice shall include the number of Participating Shares that such
non-selling Shareholder wishes to Sell in the Section 4.2 Sale. Until the
termination of the Tag Along Notice Period, the Section 4.2 Seller shall not
Sell any of the Shares subject to the Section 4.2 Sale.
(c) The per share consideration to be paid to the Section 4.2
Seller and each non-selling Shareholder participating in the Section 4.2 Sale
shall be the Section 4.2 Sale Price. Each of the non-selling Shareholders
electing to participate in the Section 4.2 Sale (i) shall be responsible for
delivering to the Third Party the certificate or certificates representing all
Shares that such non-selling Shareholder is Selling and collecting directly from
the Third Party the consideration to be paid in connection with the Sale of such
Shares and (ii) shall cooperate in good faith to effect the Sale to such Third
Party hereunder.
(d) If at the termination of the Tag Along Notice Period any
non-selling Shareholder shall not have elected to participate in the Section 4.2
Sale, such non-selling Shareholder will be deemed to have waived any of and all
of its rights under this Section 4.2 with respect to the Sale of its Shares
pursuant to such Section 4.2 Sale. If any non-selling Shareholder (i) has not
elected to Sell any of the Participating Shares it is entitled to Sell in the
Section 4.2 Sale, (ii) has elected to Sell some but not all of the Participating
Shares it is entitled to Sell in the Section 4.2 Sale, or (iii) has elected Sell
any or all of the Participating Shares it is entitled to Sell in the Section 4.2
Sale but subsequently fails to deliver to the Third Party the certificate or
certificates representing any of the Participating Shares that it has elected to
Sell, then the Section 4.2 Seller and the non-selling Shareholders which have
elected to participate in the Section 4.2 Sale (excluding any non-selling
Shareholder referred to in clauses (ii) and (iii) above) shall be entitled to
Sell additional Shares in an amount not exceeding the sum of (x) the number of
Shares that the non-selling Shareholder referred to in clause (i) above was
entitled to Sell, plus (y) the number of Shares that the non-selling Shareholder
----
referred to in clause (ii) above has elected not to Sell, plus (z) the number of
----
Shares that the non-selling shareholder referred to in clause (iii) above
elected to Sell but as to which it subsequently failed to deliver certificates
("Additional Shares"). The number of Additional Shares that each of the Section
4.2 Seller and such non-selling Shareholders (excluding any non-selling
Shareholder referred to in clauses (ii) and (iii) above) is entitled to Sell in
the Section 4.2 Sale shall be determined on a
15
pro rata basis, based upon (1) as to the Section 4.2 Seller, the number of
--- ----
Shares it would be entitled to Sell if all non-Selling Shareholders elected to
participate fully in the Section 4.2 Sale and (2) as to such non-Selling
Shareholders, the number of Shares that each has elected to Sell in the Section
4.2 Sale.
(e) The Section 4.2 Seller shall provide to each non-selling
Shareholder a copy of any amendment or modification of the Section 4.2 Agreement
in connection with the Section 4.2 Sale. Notwithstanding anything in this
Section 4.2 to the contrary, any material modification or amendment to the
Section 4.2 Agreement after execution thereof by an accepting non-selling
Shareholder including, without limitation, any decrease in the Section 4.2 Sale
Price, any change in the form of consideration or any amendment which could
increase the potential liability of the accepting non-selling Shareholder, shall
not be binding upon the non-selling Shareholder unless the accepting non-selling
Shareholder consents to such amendment or modification, or fails to reject such
modification or amendment within five Business Days after written receipt of
notice thereof (and any rejection shall be deemed to be a revocation of such
non-selling Shareholder's right to participate in such Section 4.2 Sale).
(f) Notwithstanding anything contained in this Section 4.2,
there shall be no liability on the part of the Section 4.2 Seller to any
non-selling Shareholder if the Sale of Shares pursuant to this Section 4.2 is
not consummated for whatever reason. Any decision as to whether to Sell Shares
shall be at the Section 4.2 Seller's sole and absolute discretion.
4.3 Drag Along Rights; Mandatory Right of First Refusal. (a)
If any of AOF, CAIP or QPL (the "Section 4.3 Seller") (i) proposes to Sell all
but not less than all its Shares to a Third Party (other than a Sale (w) to a
Permitted Transferee as permitted by Section 3.3, (x) in a Public Sale, or (y)
in connection with a Transfer by QPL pursuant to a Charge Transfer referred to
in Section 4.4 or pursuant to a Transfer of Shares referred to in Section 4.5)
for a per share price of at least the Required Drag Along Sale Price (a "Section
4.3 Sale"), (ii) has complied with Section 4.1 (Right of First Offer), and (iii)
desires to require the non-selling Shareholders to participate in such Sale in
respect of all of their respective Shares, then the Section 4.3 Seller must
first grant the non-selling Shareholders a right of first refusal to purchase
the Shares subject to the Section 4.3 Sale, as described in Section 4.3(b),
before it will be entitled to proceed with the Section 4.3 Sale. For the
avoidance of doubt, neither CITIC nor any direct or indirect transferee of CITIC
holding an interest in Shares that have been subject to a Transfer pursuant to
or as a result of a charge or Charge Transfer (a "CITIC Transferee") shall have
any rights under this Section 4.3, but they nonetheless shall be bound by this
Section 4.3, subject to Section 4.3(l), Section 4.3(m) and Section 4.3(n),
provided that this Section 4.3 shall not restrict any Transfer of Shares made by
way of a Public Sale.
(b) The Section 4.3 Seller shall provide ASAT and the
non-selling Shareholders written notice of such Section 4.3 Sale (a "Right of
First Refusal Notice") and a copy of the agreement pursuant to which the Section
4.3 Seller proposes to Sell such Shares (the "Section 4.3 Agreement"). The Right
of First Refusal Notice shall identify the purchaser, the number of Shares
subject to the Section 4.3 Sale, the per share price for Shares for which the
Section 4.3 Sale is proposed to be made (the "Section 4.3 Sale Price") and all
other material terms and conditions of the Section 4.3 Sale.
16
(c) The delivery of a Right of First Refusal Notice shall
constitute an offer, irrevocable for seven Business Days (the "Right of First
Refusal Notice Period"), by the Section 4.3 Seller to Sell to each non-selling
Shareholder (each an "Offeree" and collectively the "Offerees") the Shares
subject to the Section 4.3 Sale, for a per share price equal to the Section 4.3
Sale Price and on the terms and conditions as set forth in the Right of First
Refusal Notice. Each Offeree shall have the right, but not the obligation, to
accept the offer set forth in the Right of First Refusal Notice to purchase all
but not less than all of the Shares subject thereto by giving a written notice
of purchase (a "Section 4.3 Purchase Notice") to the Section 4.3 Seller prior to
the termination of the Right of First Refusal Period. Subject to Section 4.3(d),
delivery of a Section 4.3 Purchase Notice by an Offeree to the Section 4.3
Seller shall constitute a contract between such Offeree and the Section 4.3
Seller for the purchase and Sale of the Shares subject to the Right of First
Refusal Notice for a per share price equal to the Section 4.3 Sale Price and on
the other terms and conditions set forth in the Right of First Refusal Notice.
(d) In the event more than one Offeree shall deliver a Section
4.3 Purchase Notice to the Section 4.3 Seller prior to the termination of the
Right of First Refusal Notice Period, each such Section 4.3 Purchase Notice
shall constitute a separate contract between the Section 4.3 Seller and such
Offeree delivering a Section 4.3 Purchase Notice for the purchase and Sale of
Shares subject to the Right of First Refusal Notice, at the per share Section
4.3 Sale Price. The number of Shares subject to each such separate contract
shall be determined on a pro rata basis, based upon the number of Shares owned
by each Offeree delivering a Section 4.3 Purchase Notice, or on such other basis
as such Offerees may agree. The aggregate number of Shares, and the aggregate
price thereof, subject to all such contracts shall at all times equal, the
number of Shares set forth in the Right of First Refusal Notice and the per
share Section 4.3 Sale Price multiplied by the number of Shares set forth
therein, respectively.
(e) The closing of any purchase and Sale of Shares between the
Section 4.3 Seller and any Offeree delivering a Section 4.3 Purchase Notice
pursuant to Section 4.3(c) shall take place on the date designated by such
non-selling Shareholder within 30 days from the termination of the Right of
First Refusal Notice Period; provided that if such purchase and Sale of such
Shares is subject to any prior approval or other consent required by applicable
law, regulation or stock exchange rule, the time period during which the closing
of such purchase and Sale may occur shall be extended (but not to exceed 120
days in the aggregate) until the expiration of ten Business Days after all such
approvals and consents shall have been received. The parties shall use
reasonable efforts to obtain all such approvals and consents.
(f) If no Offerees deliver a Purchase Notice in accordance
with Section 4.3(c) prior to the termination of the Right of First Refusal
Notice Period, the Section 4.3 Seller may, at its option, require the
non-selling Shareholders to participate in the Section 4.3 Sale, subject to
applicable law. If the Section 4.3 Seller chooses to do so, then it shall
deliver to ASAT and the non-selling Shareholders written notice of its decision
to compel the non-selling Shareholders to Sell all their respective Shares in
the Section 4.3 Sale (a "Drag Along Notice") at the same price per share and on
the same terms specified in the Right of First Refusal Notice. Subject to
Section 4.3(b), the non-selling Shareholders shall be required to participate in
the Section 4.3 Sale on the terms and conditions set forth in the Drag Along
Notice and to tender all but not less
17
than all of their respective Shares, as set forth below. Each of the non-selling
Shareholders required to participate in the Section 4.3 Sale (i) shall deliver
to the Third Party the certificate or certificates representing all Shares that
such non-selling Shareholder is Selling in the Section 4.3 Sale on or before the
closing of the Section 4.3 Sale pursuant to Section 4.3(h); (ii) shall collect
directly from the Third Party the consideration to be paid for the Shares it is
Selling in the Section 4.3 Sale; and (iii) shall cooperate in good faith to
effect the Sale to such Third Party hereunder.
(g) Notwithstanding Section 4.3(f) to the contrary, if the
Section 4.3 Agreement would impose potential liability on the non-selling
Shareholders in excess of the purchase price to be received by the non-selling
Shareholders for the Shares to be sold by them (excluding any stamp duty for the
seller's account), the non-selling Shareholders shall have the option,
exercisable during the Drag Along Notice Period, and in lieu of participating in
the Section 4.3 Sale, to Sell their respective Shares (the "Put Shares") to the
Section 4.3 Seller at a per share price equal to 95% of the Required Drag Along
Sale Price. If the non-selling Shareholders shall exercise such option, they
each shall be thereafter obligated to Sell, and the Section 4.3 Seller shall be
obligated to purchase, the Put Shares only upon and simultaneously with the
consummation of the Section 4.3 Sale. In any such Sale to the Section 4.3
Seller, the non-selling Shareholders shall not be obligated to make any
representation or warranty to the Section 4.3 Seller other than a warranty with
respect to the title to the Put Shares and customary representations and
warranties regarding the valid and binding nature of the agreements of the
non-selling Shareholders in connection with such Sale, the possession of full
authority by the non-selling Shareholders to enter into such agreements and the
absence of any requirements for consents to or approvals by other parties for
such Sale.
(h) Any proposed Sale to a Third Party pursuant to this
Section 4.3 shall be in compliance with all applicable laws, regulations and
stock exchange rules, including, without limitation, all securities laws and
such proposed Sale shall be consummated within 30 days from the delivery of the
Drag Along Notice; provided that if the Sale of such Shares is subject to any
prior regulatory approval or consent, the time period during which such Sale may
be consummated may be extended (but not to exceed 120 days in the aggregate from
the date of execution of such agreement) until the expiration of ten Business
Days after all such approvals and consents shall have been received.
Shareholders shall use all reasonable endeavours to obtain such consents and
approvals as may be required in order for them to comply with the provisions of
this Section 4.3.
(i) Promptly after the consummation of the Sale of Shares of
the Section 4.3 Seller and the non-selling Shareholders pursuant to Section
4.3(f) or (g), the Section 4.3 Seller shall (i) give notice thereof to ASAT and
(ii) furnish such other evidence of the completion and time of completion of
such Sale and the terms thereof as may be reasonably requested by ASAT.
(j) Notwithstanding anything contained in this Section 4.3,
there shall be no liability on the part of the Section 4.3 Seller to any of the
non-selling Shareholders if the Sale of Shares to a Third Party pursuant to this
Section 4.3 is not consummated for whatever reason. Any decision as to whether
to Sell Shares shall be at the sole and absolute discretion of the Section 4.3
Seller.
18
(k) Save as otherwise provided in this Section 4.3(k), if at
any time QPL owns less than 50% of the outstanding Shares (including as a result
of a Transfer pursuant to Section 4.4 or otherwise), this Section 4.3 shall be
deemed permanently amended to delete QPL from the definition of "Section 4.3
Seller" and to eliminate any right of QPL to exercise any rights under Section
4.3. If at any time the Investors collectively own less than 50% of the
outstanding Shares (including as a result of a Transfer pursuant to Section or
otherwise), this Section 4.3 shall be deemed permanently amended to delete AOF
and CAIP from the definition of "Section 4.3 Seller" and to eliminate any right
of AOF and CAIP to exercise any rights under Section 4.3. Following an Initial
Public Offering by ASAT, Public Sale by QPL or the Investors (as applicable),
issue of Shares upon exercise of the Warrants or issue of Shares to employees of
any ASAT Company pursuant to an exercise of stock options granted to such
employee, this Section 4.3(b) shall remain in effect and the 50% threshold
referred to above shall be reduced to reflect the dilutive effect or reduction
of the numbers of Shares held by QPL or the Investors as a result of such event.
(l) Notwithstanding any provision in the CITIC Share Charge,
the Facility or any other agreement between QPL and CITIC (including their
Affiliates), if CAIP or AOF is the Section 4.3 Seller and a Charge Transfer or
QPL Bankruptcy Event shall have occurred or is in the process of occurring, CAIP
and AOF may exercise their drag along rights under this Section 4.3 in respect
of any Shares subject to the CITIC Share Charge or held by CITIC or any CITIC
Transferee and, in the case of a QPL Bankruptcy Event, any Shares held by QPL
whether or not the Required Drag Along Sale Price condition of Section 4.3(a) is
satisfied, provided that the Required Drag Along Sale Price is not less than the
lower of (x) the Required Drag Along Sale Price and (y) Fair Market Value per
Share on the last NASDAQ National Market System trading day immediately
preceding the beginning of the Right of First Refusal Notice Period.
(m) If upon the enforcement of its rights under the CITIC
Share Charge, CITIC desires to effect a Charge Transfer, either directly or
through QPL, by way of a Public Sale, CITIC may do so notwithstanding the
restrictions of Section 4.3(n), provided that the exclusions of this Section
4.3(m) apply only to CITIC and any nominee which is to be the holder of such
Shares on CITIC's behalf and shall not apply to any CITIC Transferee, except for
a Transferee that acquires the Shares by way of a Public Sale.
(n) If any Shareholder delivers a Right of First Offer Notice
pursuant to Section 4.1 and clause (ii) of Section 4.3(a), stating that it
intends to exercise its drag along rights pursuant to this Section 4.3, no
Shareholder may Transfer any Shares during the related Right of First Offer
Notice Period or the immediately following Right of First Refusal Notice Period,
provided that CITIC may enforce its rights during these periods pursuant to the
CITIC Share Charge to cause QPL to effect a Transfer to CITIC or any nominee of
CITIC which is to be the holder of such Shares on CITIC's behalf.
4.4 CITIC Share Charge.
(a) QPL shall be entitled to charge (but not by way of legal
mortgage) (x) to the Investors all Shares subject to the Investors' charge
referred to in Section 4.5 and (y) to CITIC all Shares subject to the CITIC
Share Charge.
19
(b) Before CITIC may enforce its rights under the CITIC Share
Charge to cause a Transfer of Shares from QPL to it or to any other person (a
"Charge Transfer") other than by way of a Public Sale, it shall first comply
with all of the provisions for Transfers of Shares in Section 4.1 and give each
Shareholder (other than QPL) a Right of First Offer Notice offering to Sell the
Shares subject to the Charge Transfer (the "Charge Transfer Shares") to them at
a price no more than the Fair Market Value on the last NASDAQ National Market
System trading day immediately preceding the beginning of the Right of First
Offer Notice Period, provided that the Right of First Offer Notice Period shall
be 30 days and shall be extended if and for so long as any action by a court,
liquidator, administrator, judicial manager or any equivalent in any relevant
jurisdiction prevents the Offerees from accepting the Right of First Offer. If
no such Shareholders deliver a Section 4.1 Purchase Notice in accordance with
Section 4.1(b) prior to the termination of the Right of First Offer Notice
Period, CITIC may thereafter Sell the Charge Transfer Shares to any other person
for the period provided in Section 4.1(d) (subject to extension as provided in
the prior sentence). If such Sale is not completed within such period, any
further Sale by CITIC shall again be subject to Article 4.1.
(c) Except for a Charge Transfer made by way of Public Sale,
CITIC shall cause the first CITIC Transferee or Transferees, as the case may be,
thereof to agree in writing in form and substance satisfactory to AOF to be
bound by Article 3 and Article 4 as a condition of any Charge Transfer. Upon the
occurrence of a Charge Transfer, neither CITIC nor any CITIC Transferee shall
succeed to QPL's rights under this Agreement except as expressly stated in
Sections 4.1 and 4.2 for a CITIC Transferee. CITIC and each CITIC Transferee,
however, shall be subject to all obligations of the Shareholders under Articles
3 and 4, except as expressly excluded elsewhere in this Article 4 where the
Transfer is made by way of a Public Sale.
4.5 Investors Charge. Nothing in this Article 4 shall preclude a
Transfer of Shares to the chargee or the Investors under the deed of first
charge dated October 29, 1999 over the Shares pledged by QPL to secure its
obligations to the Investors under the Subscription Agreement.
4.6 Improper Transfer. Any attempt to Transfer any Shares not in
compliance with this Agreement shall be null and void and neither ASAT nor any
transfer agent shall give any effect in ASAT's stock records to such attempted
Transfer.
4.7 Cooperation upon Transfer. The parties hereto agree to
cooperate in good faith in negotiating any adjustments to this Agreement that
may be necessary as a result of any Transfer of Shares by a Shareholder in
accordance with this Agreement.
ARTICLE 5
CONFIDENTIALITY;
NON-COMPETITION
20
5.1 Confidentiality. (a) Each Shareholder hereby agrees that
Confidential Information (as defined below) has been and will be made available
to it in connection with such Shareholder's investment in ASAT. Each Shareholder
agrees that it will not use the Confidential Information in any way to the
competitive disadvantage of any ASAT Company. Each Shareholder further
acknowledges and agrees that it will not disclose any Confidential Information
to any Person; provided that Confidential Information may be disclosed (i) to
such Shareholder's directors, officers, employees, agents, Affiliates, partners,
fund investors and co-investors, counsel, legal and financial advisers,
accountants, consultants and controlling persons (all such persons being
collectively referred to as "Representatives") in the normal course of the
performance of their duties provided that such Representatives agree to abide by
the terms of this Section 5.1, (ii) to the extent required by applicable law,
rule, regulation, legal process or regulatory authority (including complying
with any oral or written questions, interrogatories, requests for information or
documents, subpoenas, civil investigative demands or similar process to which
such Shareholder is subject) or the rules of any securities exchange on which
ASAT is listed, provided that such Shareholder has not taken action that caused
or could have reasonably been foreseen to cause such legal obligation for
disclosure and such action (other than entering into any Transaction Agreement)
could have reasonably been avoided, (iii) to any Person to whom such Shareholder
in good faith is contemplating a Transfer of its Shares, provided that such
Transfer would not be in violation of the provisions of this Agreement and as
long as such Person is advised of the confidential nature of such information
and agrees to be bound by a confidentiality agreement on substantially the same
basis as this Section 5.1, (iv) by the Investors or any of their Representatives
to Persons providing possible sources of financing for the transactions
contemplated by the Transaction Agreements, and (v) if the prior written consent
of the Board shall have been obtained. Nothing contained herein shall prevent
the use of Confidential Information in connection with the assertion or defense
of any claim by or against the ASAT Companies or any Shareholder. The parties
hereto acknowledge that this Section 5.1 supersedes all prior agreements entered
in among any of the parties hereto with respect to the confidentiality of the
matters specified in this Section 5.1.
(b) "Confidential Information" means any information concerning
(i) any ASAT Company, its financial condition, business, operations or prospects
in the possession of or to be furnished to any Shareholder in its capacity as a
shareholder of ASAT or by virtue of its present or former position as, or right
to designate, a director of ASAT, (ii) the Transaction Agreements, the
transactions contemplated thereby, the terms and conditions thereof or any
discussions, correspondence or other communications among the parties to the
Transaction Agreements or their respective Representatives relating to the
Transaction Agreements or any of the transactions contemplated thereunder and
(iii) documents and information concerning QPL, any of its Affiliates or any
ASAT Company furnished to any of the Investors in connection with the due
diligence review conducted by the Investors in evaluating QPL, its Affiliates,
the ASAT Companies and the transactions contemplated by the Transaction
Agreements; provided that the term "Confidential Information" does not include
information which (x) was or becomes generally available publicly (other than as
a result of a disclosure by a Shareholder or its Representatives in violation of
any confidentiality provision contained in this Agreement, Transaction
Agreements or any confidentiality agreement executed in accordance with the
Transaction Agreements), (y) is disclosed publicly by ASAT (including by way of
public filings with the United States Securities and Exchange Commission or
Nasdaq and any informational
21
meetings between ASAT and analysts and investors which ASAT treats as
non-confidential), or (z) becomes available to a Shareholder on a
non-confidential basis from a source other than ASAT, any regulatory entity, or
another Shareholder or its Representatives, provided that such source is not, to
the best of such Shareholder's knowledge, bound by a confidentiality agreement
with ASAT or another Person.
5.2 Non-Competition by QPL. (a) Save as otherwise provided in
this Section 5.2(a), for so long as the QPL Group collectively beneficially
owns, directly or indirectly, at least 20% of the outstanding Shares, the
restrictions set forth in this Section 5.2 shall apply. Once the QPL Group's
collective ownership of Shares falls below this 20% amount, the obligations of
the QPL Group under this Section shall remain in effect for one year thereafter.
Following an Initial Public Offering by ASAT, Public Sale by QPL, issue of
Shares upon exercise of the Warrants or issue of Shares to employees of any ASAT
Company pursuant to an exercise of stock options granted to such employee, this
Section 5.2 shall remain in effect and the 20% threshold referred to above shall
be reduced to reflect the dilutive effect or reduction of the numbers of Shares
held by QPL as a result of such event.
(b) The QPL Group shall not engage in the Businesses. The QPL
Group shall direct all future business opportunities in the Businesses that may
come to its attention to the ASAT Companies.
(c) The QPL Group shall not make, directly or indirectly
through any Affiliate, any direct or indirect Investment in, extend any lending
to, or provide any technical assistance (other than packaging technology
assistance) to, any Competitor without the prior written consent of the
Investors, provided that this Section 5.2(c) shall not prohibit the QPL Group
from making any Investment in a Competitor if (i) such Investment is in a
security of such Competitor that is listed on an international securities
exchange and (ii) taking into account such Investment, the QPL Group would not
itself or with any other group, directly or indirectly, own more than 5% of the
outstanding voting securities of such Competitor.
(d) The parties hereto agree that ASAT France will be excluded
from these restrictions, subject to compliance with the provisions of the ASAT
France Agreement entered into among, inter alia, ASAT Cayman and QPL on the
Closing Date.
5.3 Non-Competition by Investors. (a) If and for as long as an
Investor shall make an Investment in an entity that is a Competitor of any ASAT
Company, (i) each director of ASAT's Board appointed by such Investor, and any
alternate director and observer designated by such Investor, shall recuse
himself from any and all business matters addressed by the Board or any
committee thereof relating to such Competitor, and (ii) each director of ASAT's
Board appointed by such Investor shall be prohibited from serving as a director
on the board of such Competitor.
(b) In the event any of the ASAT Companies intends to acquire
an interest in any Competitor (a "Target"), and any Investor has an interest in
such Target, then each director of ASAT's Board representing such Investor, and
any alternate director and observer designated by
22
such Investor, shall recuse himself from any and all business matters addressed
by the Board or any committee thereof relating to the acquisition of such
Target.
5.4 Definitions. For purposes of Sections 5.2 and 5.3:
(a) "Businesses" means the design, assembly and testing of
integrated circuit packages and the marketing and sales thereof.
(b) "Competitor" means any entity engaged in any of the
Businesses that sells into markets in which any ASAT Company, ASAT France or
ASAT Switzerland sells (either directly, through an ASAT Company or through
Semiconductor Consultants B.V.).
(c) "Investment" in any entity means any investment in
share capital of such entity (including common or preferred shares) or the
equivalent, including without limitation any instrument, security, option, note
or agreement exercisable for, convertible into or providing for the issue,
exchange or transfer of shares or similar interests in the share capital of such
entity.
(d) "QPL Group" means QPL and its Affiliates (other than
the ASAT Companies).
ARTICLE 6
QPL BANKRUPTCY; INDEMNIFICATION
6.1 QPL Bankruptcy Event. (a) Notwithstanding anything in this
Agreement or any other Transaction Agreement to the contrary, if a QPL
Bankruptcy Event shall have occurred, then (i) AOF may require all the directors
appointed or nominated by QPL (including the Independent Director) pursuant to
Section 2.1 to resign and such vacancies shall be filled in accordance with
Section 2.3(b), and (ii) QPL shall have no rights (but shall have the
obligations) under Article 2 and Article 4. Upon any Sale of Shares (other than
a Public Sale) owned by QPL by a court, liquidator, court appointed
administrator, trustee in bankruptcy or other person administering QPL following
a QPL Bankruptcy Event to a Third Party that is not a Financial Creditor of QPL
or any ASAT Company, such Third Party (x) shall be entitled to appoint under
Section 2.1(a) the number of directors specified in Section 2.1(b) based upon
its shareholding in ASAT as if its name was substituted for QPL (the maximum
number of directors such Third Party shall be entitled to appoint hereunder
shall be two), and (y) shall have the other rights of a Shareholder under
Articles 2 and 4 (except Section 4.3), provided that in each such case such
Third Party shall have executed a deed of adherence agreeing to be bound by the
terms and conditions of this Agreement as a shareholder and as if such Third
Party's name were substituted for QPL herein.
(b) "QPL Bankruptcy Event" shall mean in relation to QPL or
any Affiliate of QPL that directly or indirectly owns Shares, the insolvency,
liquidation, amalgamation,
23
reconstruction, reorganization, administration, administrative or other
receivership, or dissolution of that person, and any step taken (including, but
without limitation, the presentation of a petition or the passing of a
resolution) for or with a view to any of the foregoing other than a members'
voluntary liquidation or voluntary scheme of arrangement solely for the purpose
of a bona fide scheme of solvent amalgamation or reconstruction.
6.2 Indemnification. Each Shareholder hereby indemnifies the
other Shareholders and their respective Affiliates ("Indemnitees") against and
agrees to hold them harmless from and against any and all damage, loss,
liability and expense (including, without limitation, reasonable expenses of
investigation and reasonable attorneys' fees and expenses in connection with any
action, suit or proceeding, as incurred) incurred or suffered by any Indemnitee
arising out of any breach of any covenant or agreement made or to be performed
by such Shareholder pursuant to this Agreement.
ARTICLE 7
MISCELLANEOUS
7.1 Ong Lawsuit. The parties hereto acknowledge that ASAT HK
and QPL are currently involved in a lawsuit initiated by a former employee of
ASAT HK, ▇▇. ▇▇▇ ▇▇ ▇▇▇▇▇. ▇▇. ▇▇▇ has claimed that QPL and ASAT HK promised but
failed to allot to him shares of ASAT HK. QPL hereby agrees to use all
reasonable endeavors (i) to defend vigorously the claim if QPL is advised such a
defence will (on a balance of probabilities) win, or, if not, resolve this
lawsuit out of court and (ii) if any compensation is to be paid to ▇▇. ▇▇▇ in
connection with such resolution, to structure such payment as a cash only
payment by QPL not involving an issuance of shares of any of the ASAT Companies.
QPL shall cooperate and consult in good faith with the other Shareholders and
shall not agree to any settlement or other arrangement in respect of such claim
that in any respect creates any liability or obligation for the account of any
ASAT Company or other Shareholders without the other Shareholders' consent. If
for any reason any equity interests are required to be transferred or issued to
▇▇. ▇▇▇ in connection with this dispute (which QPL undertakes vigorously to
defend if QPL is advised such a defence will (on a balance of probabilities)
win), then QPL shall transfer to ▇▇. ▇▇▇ the number of Shares required to
satisfy the dispute (such Shares shall be Shares owned by QPL at such time or
Shares obtained by QPL in the open market) and shall take all actions necessary
to ensure that ASAT does not have to issue any Shares in connection with this
dispute. In agreeing to the matters set forth in this Section 7.1, the parties
hereto are in no way admitting any liability on the part of QPL, any ASAT
Company or any of their Affiliates. Reference to "QPL" in this Section 7.1 shall
refer solely to QPL International Holdings Limited, and not TIIC or QPL US.
7.2 Entire Agreement. This Agreement and the other Transaction
Agreements constitute the entire agreement among the parties hereto and thereto
and supersede all prior agreements and understandings, both oral and written,
among all of the parties hereto and thereto with respect to the subject matter
hereof and thereof. No representation, inducement, promise, understanding,
condition or warranty not set forth herein has been made or relied upon by any
24
party hereto.
7.3 Binding Effect; Benefit. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective heirs,
successors, legal representatives and permitted assigns (except as to Article 2
which shall not be binding upon ASAT and for which purposes ASAT is not a party
to this Agreement). Nothing in this Agreement, expressed or implied, is intended
to confer on any Person other than the parties hereto, and their respective
heirs, successors, legal representatives and permitted assigns, any rights,
remedies, obligations or liabilities under or by reason of this Agreement.
7.4 Assignment. No party hereto may assign, delegate or
otherwise Transfer any of its rights or obligations under this Agreement, except
that any Person acquiring Shares who is required by the terms of this Agreement
to become a party hereto shall execute and deliver to ASAT a deed of adherence
in the form of Annex B to be bound by this Agreement and shall thenceforth be a
"Shareholder", and any Shareholder who ceases to beneficially own any Shares
shall cease to be bound by the terms hereof (other than Sections 3.3, 5.1, 5.2,
6.2 and Article 7).
7.5 Amendment; Waiver; Termination. (a) Any provision of this
Agreement may be amended or waived if, but only if, such amendment or waiver is
in writing and is signed, in the case of an amendment, by each party to this
Agreement, or in the case of a waiver, by the party against whom the waiver is
to be effective.
(b) No failure or delay by any party in exercising any right,
power or privilege hereunder shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any rights or
remedies provided by law.
(c) This Agreement shall terminate and be of no further force
or effect (i) as to (A) AOF and CAIP, (B) QPL, and (C) the Co-Investors (the
Shareholders in clauses (A) and (C) being treated as a single Shareholder and
their holdings of Shares being calculated on a combined basis for purposes of
this Section 7.5(c)), when such Shareholder and its Permitted Transferees ceases
to own, directly or indirectly, at least 5% of the outstanding Shares or (ii)
when only one Shareholder remains subject to this Agreement.
(d) Notwithstanding Section 7.5(c), (i) Sections 5.1, 5.2, 6.2
and Article 7 shall survive any termination of this Agreement, (ii) upon a
Transfer of Shares by AOF or QPL which would result in a termination of this
Agreement as to such Person pursuant to Section 7.5(c)(i), such Person shall
cause its appointed directors to resign in accordance with Section 2.1(d) and
such directors shall not be entitled to vote and shall not be counted as
attending the Board meeting at the time the Board elects a successor as provided
in Section 2.3(c), and (iii) upon a Transfer of Shares by AOF or QPL which would
result in a termination of this Agreement pursuant to Section 7.5(c)(ii), the
one remaining Shareholder shall vote its Shares and take all actions necessary,
and if such Shareholder has appointed any directors pursuant to Section 2.1 then
it agrees to procure that its appointed directors will vote and take all action
necessary, to comply with Sections 2.3(b) and (c) in filling any vacancy on the
Board resulting from a
25
resignation required under Section 2.1(d) and subclause (ii) above due to the
Transfer of Shares by QPL or AOF.
7.6 Notices. All notices, requests and other communications
given or made pursuant hereto or pursuant to any other agreement among the
parties, unless otherwise specified, shall be in writing and shall be deemed to
have been duly given or made if sent by fax (with confirmation in writing),
delivered personally or sent by registered or certified mail (postage prepaid,
return receipt requested) to the parties at the fax number or address set forth
in Annex C hereto or at such other addresses as shall be furnished by the
parties by like notice. Such notice, request or communication shall be deemed to
have been given or made on the date of receipt by the recipient thereof if
received prior to 5 p.m. in the place of receipt and such day is a Business Day
in the place of receipt. Otherwise, any such notice, request or communication
shall be deemed not to have been received until the next succeeding Business Day
in the place of receipt. Any Person who becomes a Shareholder shall provide its
address and fax number to ASAT, which shall promptly provide such information to
each other Shareholder.
7.7 Section Headings. The headings of Sections in this
Agreement are provided for convenience only and will not affect its construction
or interpretation.
7.8 Counterparts. This Agreement may be signed in any number
of counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
7.9 Severability. If any provision contained in this Agreement
shall for any reason be held invalid, illegal or unenforceable in any respect,
such invalidity, illegality or unenforceability shall not affect any other
provisions of this Agreement, but this Agreement shall be construed as if such
invalid, illegal or unenforceable provision had never been contained herein. It
is the intention of the Parties that if any of the restrictions or covenants
contained herein is held to cover a geographic area or to be for a length of
time which is not permitted by applicable law, or in any way construed to be too
broad or to any extent invalid, such provision shall not be construed to be
null, void and of no effect, but to the extent such provision would be valid or
enforceable under applicable law, a court of competent jurisdiction shall
construe and interpret or reform this Agreement to provide for a covenant having
the maximum enforceable geographic area, time period and other provisions (not
greater than those contained herein) as shall be valid and enforceable under
such applicable law.
7.10 Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of England.
7.11 Specific Enforcement. Each party hereby acknowledges that
the remedies at law of the other parties for a breach or threatened breach of
this Agreement would be inadequate and, in recognition of this fact, any party
to this Agreement, without posting any bond, and in addition to all other
remedies which may be available, shall be entitled to obtain equitable relief in
the form of specific performance, a temporary restraining order, a temporary or
permanent injunction or any other equitable remedy which may then be available.
26
7.12 Submission to Jurisdiction. Each party hereby irrevocably
agrees that the courts of England shall have non-exclusive jurisdiction to
settle any dispute which may arise out of or in connection with this Agreement
and that accordingly any suit, action or proceedings (together referred to as
"Proceedings") arising out of or in connection therewith may be brought in such
courts. Each party hereto irrevocably waives any objection which it may have now
or hereafter to the laying of the venue of any Proceedings in any such court and
any claim that any such Proceedings have been brought in an inconvenient forum
and hereby further irrevocably agrees that a judgment in any Proceedings brought
in the courts of England shall be conclusive and binding upon it and may be
enforced in the courts of any jurisdiction.
7.13 Agent for Service. (a) QPL, TIIC and QPL US each appoints
RB Secretariat Limited of Beaufort House, Tenth Floor, ▇▇ ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ to be its agent for the receipt of service of process in
England. Each Investor and ASAT appoints Trusec Limited of ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ to be its agent for the receipt of service of process in
England. Each party agrees that any Service Document (as defined below) may be
effectively served on it in connection with Proceedings in England and Wales by
service on its agent.
(b) Any Service Document shall be deemed to have been duly
served on a party if marked for the attention of such party's agent at the
address set out above in Section 7.8(a) in respect of such agent or such other
address within England or Wales as may be notified to the other parties and: (i)
left at the specified address; or (ii) sent to the specified address by first
class post. In the case of (i), the Service Document shall be deemed to have
been duly served when it is left. In the case of (ii), the Service Document
shall be deemed to have been duly served two clear UK business days after the
date of posting.
(c) "Service Document" means a writ, summons, order, judgment
or other process issued out of the courts of England and Wales in connection
with any Proceedings, "UK Business Days" means a day other than a Saturday,
Sunday or any day on which banks located in England are obligated to close.
7.14 CITIC Share Charge and Facility. Without the prior
written consent of the Investors, QPL and their Affiliates shall not agree to
any changes to (i) the CITIC Share Charge, the Facility or related arrangements
that would materially and adversely prejudice AOF's, CAIP's or the other
Investors' rights under this Agreement or the value of Shares held by Investors
or Shares subject to the Investors share charge referred to in Section 4.5. QPL
shall promptly notify all Shareholders of, and reasonably describe in such
notice the scope and nature of, any amendments to such agreements and
arrangements and any default thereunder. QPL shall promptly provide to the
Investors copies of draft agreements and correspondence regarding such
amendments or defaults reasonably requested by the Investors.
7.15 QPL Obligations. As applicable, (i) all agreements and
obligations of QPL herein shall be construed as agreements and obligations of
such Subsidiary that directly or indirectly owns Shares and QPL shall cause such
Subsidiary to fulfil such agreements and obligations, which shall be joint and
several among QPL and its Subsidiaries, and (ii) all agreements and obligations
herein of Subsidiaries of QPL that are Shareholders shall be
27
construed as agreements and obligations of QPL.
28
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.
ASAT HOLDINGS LIMITED
By: /s/ ▇.▇. ▇▇
---------------------------
Name: ▇.▇. ▇▇
Title: Chairman
QPL INTERNATIONAL HOLDINGS LIMITED
By: /s/ ▇.▇. ▇▇
---------------------------
Name: ▇.▇. ▇▇
Title: Chairman
THE INDUSTRIAL INVESTMENT COMPANY LIMITED
By: /s/ ▇.▇. ▇▇
---------------------------
Name: ▇.▇. ▇▇
Title: Chairman
QPL (US) INC.
By: /s/ ▇.▇. ▇▇
---------------------------
Name: ▇.▇. ▇▇
Title: Chairman
CHASE ASIA INVESTMENT PARTNERS II (Y), LLC
By: Chase Asia Investment Partners, L.P.,
its member
By: Chase Asia Equity Partners, L.P.,
its general partner
By: CCP Asia Equity Company,
a managing general partner
By: /s/ ▇▇▇▇▇ ▇▇▇▇
---------------------------
Name: ▇▇▇▇▇ ▇▇▇▇
Title: Managing Director
ASIA OPPORTUNITY FUND, L.P.
By: Asia Opportunity Company, its general
partner
By: /s/ ▇▇▇▇▇ ▇▇▇▇
---------------------------
Name: ▇▇▇▇▇ ▇▇▇▇
Title: Managing Director
ORCHID HONG KONG INVESTMENT HOLDINGS
By: Orchid Asia II, L.P., its sole member
By: Orchid Asia Holdings, LLC,
its general partner
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: President
RESERVOIR-OLYMPUS II, L.P.
By: Olympus Capital Holdings Asia, L.L.C.,
its general partner
By: Olympus Capital Holdings Asia,
its managing member
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Managing Director
OLYMPUS HOLDINGS, L.P.
By: Olympus Management GP Corporation,
its general partner
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Managing Director
OLYMPUS CAPITAL ASIA, L.P.
By: Olympus Capital Holdings Asia, L.L.C.,
its general partner
By Olympus Capital Holdings Asia,
its managing member
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Managing Director
OLYMPUS CAPITAL ASIA OFFSHORE, L.P.
By: Olympus Capital Holdings Asia, L.L.C.,
its general partner
By Olympus Capital Holdings Asia,
its managing member
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Managing Director
OLYMPUS CAPITAL HOLDINGS ASIA I, L.P.
By: Olympus Capital Holdings Asia, L.L.C.,
its general partner
By: Olympus Capital Holdings Asia,
its managing member
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Managing Director
OLYMPUS KB, L.P.
By: Olympus Capital Holdings Asia, L.L.C.,
its general partner
By: Olympus Capital Holdings Asia,
its managing member
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Chairman
ZAM-OLYMPUS CO-INVEST, L.L.C.
By: Olympus Capital Holdings Asia, L.L.C.,
its managing member
By Olympus Capital Holdings Asia,
its managing member
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Managing Director
OLYMPUS-ASAT I, L.L.C.
By: Olympus Capital Holdings Asia, L.L.C.,
its managing member
By: Olympus Capital Holdings Asia,
its managing member
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Managing Director
OLYMPUS-ASAT II, L.L.C.
By: Olympus Capital Holdings Asia, L.L.C.,
its managing member
By: Olympus Capital Holdings Asia,
its managing member
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Managing Director
ANNEX A
List of Co-Investors
Orchid Hong Kong Investment Holdings
Olympus Capital Holdings Asia I, L.P.
Reservoir-Olympus II, L.P.
Olympus KB, L.P.
Olympus Capital Asia, L.P.
Olympus Capital Asia Offshore, L.P.
Olympus Holdings, L.P.
OLYMPUS-ASAT I, L.L.C.
OLYMPUS-ASAT II, L.L.C.
ZAM-Olympus Co-Invest, L.L.C.
A-1
ANNEX B
Form of Deed of Adherence
THIS DEED is made on [ ] 199
by [ ], a company incorporated [in / under the laws of] [ ] under
registered number [ ] whose [registered / principal] office is at [ ]
(the "New Shareholder").
WHEREAS:-
(A) By a transfer dated [ ], [ ] transferred to the New Share-
holder [ ] shares of [ ] each (the "Shares") in the capital of
ASAT Limited (the "Company").
(B) This Deed is entered into in compliance with the terms of Article 3.3.
(Permitted Transferees)/Article [4.5] of a shareholders agreement dated
[ ] 1999 made between (1) Chase Asia Investment Partners II (Y),
LLC,(2) Asia Opportunity Fund, L.P., (3) The Co-Investors named
therein, (4) QPL International Holdings Limited, (5) Bring Luck
Limited, (6) The Industrial Investment Company Limited and (7) the
Company as such agreement shall have been or may be amended,
supplemented or novated from time to time (the "Shareholders'
Agreement").
THIS DEED WITNESSES as follows:-
1. In consideration of the giving of consent by the Shareholders to the
transfer of the Shares to the New Shareholder, the New Shareholder
undertakes to adhere to and be bound by the provisions of the
Shareholders' Agreement, and to perform the obligations imposed by the
Shareholders' Agreement which are to be performed on or after the date
of this Deed, in all respects as if the New Shareholder were a party to
the Shareholders' Agreement and named therein as a Shareholder.
2. This Deed is made for the benefit of (a) the original parties to the
Shareholders' Agreement and (b) any other person or persons who after
the date of the Shareholders' Agreement (and whether or not prior to or
after the date of this Deed) adheres to the Shareholders' agreement.
3. The address and facsimile number of the New Shareholder for the
purposes of Annex B of the Shareholders' Agreement are as follows:
Party and title of Address Facsimile no.
---------------------------- ------- -------------
individual
----------
[ ] [ ] [ ]
4. This Deed shall be governed by and construed in accordance with English
law.
5. The courts of England are to have jurisdiction to settle any dispute
arising out of or in connection with this Deed. Any proceeding, suit or
action arising out of or in connection
B-1
with this agreement ("Proceedings") may therefore be brought in the
English courts. The New Shareholder agrees that this jurisdiction
agreement is irrevocable and that it is for the benefit of each of the
parties referred to in clause 2 of this Deed. Nothing contained in this
--------
clause shall limit the right of any person having the benefit of this
Deed to take Proceedings against the New Shareholder in any other court
or in the courts of more than one jurisdiction at the same time.
6. The New Shareholder irrevocably appoints [ ] to be its agent
for the service of process in England in respect of any Proceedings.
7. [If the New Shareholder is domiciled in Switzerland] The New
Shareholder waives the benefit of the declaration made under paragraph
1 of Article Ia of Protocol No. 1 annexed to the Convention on
jurisdiction and the enforcement of judgements in civil and commercial
matters opened for signature at Lugano on 16 September 1988.
IN WITNESS of which this Deed has been executed and delivered by the New
Shareholder on the date which first appears above.
Executed as a deed ....................................
Director
) ....................................
by [name of English company] acting) Director/Secretary
by [a director and its secretary/
)
two directors]
)
OR
B-2
The common seal of [name of [Common seal to be affixed here]
)
English company] was affixed
)
in the presence of:
)
......................................
Director
......................................
Director/Secretary/Person authorised by
the board of directors of [name of
company]
OR
Executed as a deed by [name of .............................
) Authorised signatory(ies)
foreign company] acting by [name
)
of authorised signatory(ies)] [who,
)
in accordance with the laws of the
)
territory in which [name of foreign
)
company] is incorporated, [is/are]
)
acting under the authority of [name )
of foreign company]]
)
B-3
[If the New Shareholder is domiciled in Luxembourg] Without prejudice to the
execution of this agreement by the parties, [name of Luxembourg party] expressly
and specifically confirms its agreement with the provisions of clause 5 of this
--------
Deed for the purposes of (a) Article I of the Protocol annexed to the Convention
on jurisdiction and the enforcement of judgments in civil and commercial matters
signed at Brussels on 27 September 1968, and (b) Article I of Protocol No. 1
annexed to the Convention on jurisdiction and the enforcement of judgments in
civil and commercial matters opened for signature at Lugano on 16 September
1988.
[Name of Luxembourg party]
.................................. .....................................
(Signature of authorised person) (Signature of authorised person)
Name: ............................ Name:................................
Title: ........................... Title:...............................
B-4
ANNEX C
Addresses for Notices
If to CAIP or AOF, to:
Chase Asia Investment Partners II (Y), LLC
Asia Opportunity Fund, L.P.
Suite 3003, 30/F
One International Finance Centre
▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇
Attention: Chief Executive Officer
Fax: ▇▇▇-▇▇▇▇-▇▇▇▇
with a copy to:
Milbank, Tweed, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
3007 ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇, Esq.
Fax: ▇▇▇-▇▇▇▇-▇▇▇▇
If to Olympus Capital Holdings Asia I, L.P.,
Reservoir-Olympus II, L.P.,
Olympus KB, L.P.,
Olympus Capital Asia, L.P.,
Olympus Capital Asia Offshore, L.P.,
Olympus Holdings, L.P. and/or
ZAM-Olympus Co-Invest, L.L.C. to:
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Asia
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
and
c/o Olympus Capital Holdings Asia
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇
C-1
Attn: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Fax: ▇▇▇-▇▇▇▇-▇▇▇▇
If to Orchid Hong Kong Investment Holdings, to
c/o Orchid Asia Holdings, L.L.C.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Fax: ▇-▇▇▇-▇▇▇-▇▇▇▇
and
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇
Fax: ▇▇▇-▇▇▇▇-▇▇▇▇
If to QPL, to:
QPL International Holdings Limited
2nd Floor, QPL Industrial Building
138 Texaco Road,
Tsuen Wan, New Territories
Hong Kong
Attention: Chief Executive Officer
Fax: ▇▇▇-▇▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇-▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Fax: ▇▇▇-▇▇▇▇-▇▇▇▇
If to ASAT, to:
ASAT Holdings Limited
▇/▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇ Industrial Building
138 Texaco Road,
▇-▇
▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇
Attention: Chief Executive Officer
Fax: ▇▇▇-▇▇▇▇-▇▇▇▇
with a copy to Milbank, Tweed, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ at the above address.
C-3