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EXHIBIT 2.2B
[BAKER & MCKENZIE LETTERHEAD]
SHAREHOLDERS DEED
between
ASIA ONLINE LTD.
and
ASIA ONLINE-AUSTRALIA PTY LTD
(ACN 089 444 691)
and
THE PARTIES LISTED IN SCHEDULE 1
and
BRISBANE INTERNET TECHNOLOGY PTY LTD
(ACN 070 339 829)
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CONTENTS
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CLAUSE
NUMBER HEADING PAGE
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1. DEFINITIONS AND INTERPRETATION 2
1.1 Definitions 2
1.2 Interpretation 4
2. COMMENCEMENT OF OBLIGATIONS ON CLOSING 5
3. THE BUSINESS 5
4. MANAGEMENT OF THE COMPANY 5
4.1 Appointment of directors 5
4.2 Manner of appointment 5
4.3 Resignation on disposal 6
4.4 Liability for removal 6
4.5 Meetings of the Board 6
4.6 Shareholders Meetings 6
4.7 Chairman 6
5. MATTERS REQUIRING UNANIMOUS CONSENT 7
5.1 Unanimous consent 7
6. TRANSFER OF SHARES 7
6.1 No dealing in Shares 7
6.2 Transfer to Related Body Corporate 7
7. WARRANTIES 8
7.1 Warranties by the Members 8
7.2 Warranty by the Original Shareholders 8
7.3 AOA Warranties 8
8. SHARE SALE 9
8.1 Sale of Initial Shares 9
8.2 Conditions of Completion 9
8.3 Original Shareholders Election 9
8.4 Asia Online-Australia Election 10
8.5 Completion 10
8.6 Notice of Completion Event 10
8.7 Non-Compliance 10
8.8 Cash Election 11
9. US SECURITIES LAWS REPRESENTATIONS AND UNDERTAKINGS 11
9.1 Definitions 11
9.2 Warranties 12
9.3 Restricted Securities 13
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9.4 Legends 13
9.5 Lock Up 14
10. MUTUAL CO-OPERATION 14
10.1 Primary obligation 14
10.2 Obligations of members 14
11. NO PARTNERSHIP AND CONFLICT 14
11.1 No partnership 14
11.2 Conflict with Constitution 15
12. NOTICES 15
13. GENERAL PROVISIONS 15
13.1 Invalid or unenforceable 15
13.2 Waiver and exercise of rights 15
13.3 Amendment 15
13.4 Counterparts 15
13.5 Further assurances 16
13.6 Costs 16
13.7 Assignment 16
13.8 Non-merger 16
13.9 Entire Deed 16
13.10 Rights cumulative 16
13.11 Consents and Approvals 16
13.12 Jurisdiction and Governing Law 16
SCHEDULE 1 ORIGINAL SHAREHOLDERS 19
SCHEDULE 2 DEED OF ADHERENCE *
SCHEDULE 3 CONSTITUTION *
SCHEDULE 4 BUSINESS PLAN *
SCHEDULE 5 AOA WARRANTIES *
EXHIBIT A RESTATED CERTIFICATE OF INCORPORATION *
EXHIBIT B SCHEDULE OF PURCHASERS OF SERIES A PREFERRED *
SCHEDULE OF PURCHASERS OF SERIES B PREFERRED STOCK *
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* Schedule omitted - will be provided supplementally to the Commission upon
request.
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SHAREHOLDERS DEED
THIS DEED is made on 1999
BETWEEN
Asia Online Ltd., a company incorporated in Delaware of 23rd Floor, Citicorp
Centre, 18 Whitfield Road, Causeway Bay, Hong Kong ("Asia Online");
AND
The Parties Listed in Schedule 1 (the "Original Shareholders");
AND
Asia Online-Australia Pty Ltd (ACN 089 444 691) of Level 26, 50 Bridge Street,
Sydney New South Wales 2000 ("Asia Online-Australia")
AND
Brisbane Internet Technology Pty Ltd (ACN 070 339 829) ("the Company").
RECITALS
A. Under the Sale Agreement, Asia Online-Australia has agreed to purchase
20 in number or approximately two thirds of the Shares on issue.
B. The Members have a common strategy to develop the business of the
Company and have agreed that the best way to implement that strategy is
through common ownership of the Company.
C. The Members have entered into this Deed to set out the terms and
conditions on which the business of the Company will be managed and
operated and how each of their rights as members of the Company will be
governed.
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OPERATIVE PROVISIONS
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1. DEFINITIONS AND INTERPRETATION
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1.1 DEFINITIONS
In this Deed, all terms defined in the Sale Agreement shall have the same
meaning herein unless otherwise specified. Unless the context otherwise
requires, in this Deed:
"AOA DIRECTOR" means a Director appointed from time to time by Asia
Online-Australia under clause 4.1;
"AOA WARRANTIES" means the warranties set out in Schedule 5;
"BOARD" means the Company's board of directors from time to time;
"BUSINESS" means those activities carried on by the Company from time to time;
"BUSINESS PLAN" means the business plan in the form attached in Schedule 4 or as
approved by the Board from time to time;
"CASH ELECTION" means a unanimous election by the Original Shareholders under
clause 8.8 that the Purchase Price be paid in cash;
"CHAIRMAN" means the chairman of the Board from time to time;
"COMPLETION" means completion of the sale and purchase of the Initial Shares
under clause 8.5.
"COMPLETION EVENT" means the occurrence of any of the following:
(a) an initial public offering of Asia Online on a US stock exchange;
(b) a change of Control of Asia Online or any sale of substantially all of
the assets and undertakings of Asia Online (other than by way of any
group reorganisation or reconstruction undertaken by Asia
Online-Australia); or
(c) any group reorganisation or reconstruction involving the Company or any
material part of its assets;
"COMPLETION NOTICE" means written notice served by either Asia Online-Australia
or the Original Shareholders notifying the other of its or their wish to
complete the sale of the Initial Shares under clause 8.3 or 8.4 as the case may
be;
"COMPLETION PERIOD" means a period of 14 days from the date of the service on
the Original Shareholders of notice of the forthcoming occurrence of a
Completion Event in accordance with 8.6;
"CONSTITUTION" means the constitution of the Company in the form set out in
Schedule 3;
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"CONTROL" has the same meaning as in s243E of the Corporations Law, and to the
extent of any inconsistency as a result of a conflict of laws, has the meaning
as if any company to which it refers was registered or incorporated in New South
Wales;
"DEED OF ADHERENCE" means a deed substantially in the form set out in Schedule 2
or any other form approved in advance by all of the Members under which a
transferee or allottee of Shares agrees to be bound by all the terms of this
Deed as if it had been one of the Members;
"DIRECTOR" means any director from time to time of the Company (or a duly
appointed alternate);
"INITIAL SHARES" means the 10 Shares held by the Original Shareholders as at the
date of this Deed as set out in Schedule 1;
"MEMBER" means a registered holder from time to time of one or more Shares;
"ORIGINAL SHAREHOLDERS DIRECTOR" means a Director appointed from time to time by
the Original Shareholders under clause 4.1;
"PURCHASE PRICE" means:
(a) if the Original Shareholders make a Cash Election under clause 8.8, an
amount equivalent to the actual price at which the Asia Online stock is
to be issued in the initial public offering of Asia Online on a US
stock exchange multiplied by the total number of Asia Online Class C
Non-Voting Common Shares set out in Schedule 1;
(b) in all other cases, the issue of that number of Asia Online Class C
Non-Voting Common Shares set out in Schedule 1 and offered by Asia
Online for subscription by the Original Shareholders;
"RELATED BODY CORPORATE" has the same meaning as in section 50 of the
Corporations Law;
"SALE AGREEMENT" means the Share Sale and Purchase Agreement dated on or around
the date of this Deed between Asia Online-Australia, the Original Shareholders
and the Company;
"SECURITY INTEREST" means an interest in or over an asset which provides
security for, or protects against default by, a person for the payment or
satisfaction of a debt, obligation or liability including a mortgage, charge,
bill of sale, pledge, deposit, lien, encumbrance, hypothecation, or arrangement
for the retention of title;
"SHARE" means a share (of whatever class or denomination) in the capital of the
Company from time to time;
"THIRD PARTY INTEREST" means any Security Interest, lease, option, voting
arrangement, easement, covenant, notation, restriction, interest under any
agreement, interest under any trust, or other right, equity, entitlement or
other interest of any nature held by a third party;
"WARRANTIES" means the representations, warranties and covenants made by the
Members under clause 7 and "WARRANTY" means any one of them.
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1.2 INTERPRETATION
In this Deed, unless the context otherwise requires:
(a) a reference:
(i) to the singular includes the plural and vice versa;
(ii) to a gender includes all genders;
(iii) to a document (including this Deed) is a reference to that
document (including any Schedules and Annexures,) as amended,
consolidated, supplemented, novated or replaced;
(iv) to an agreement includes any deed, agreement or legally
enforceable arrangement or understanding whether written or
not;
(v) to parties means the parties to this Deed and to a party means
a party to this Deed;
(vi) to a notice means all notices, approvals, demands, requests,
nominations or other communications given by one party to
another under or in connection with this Deed;
(vii) to a person (including any party) includes:
(A) a reference to an individual, company, body
corporate, association, partnership, firm, joint
venture or trust as the case requires; and
(B) the person's successors, permitted assigns, executors
and administrators;
(viii) to a law:
(A) includes a reference to any constitutional provision,
subordinate legislation, treaty, decree, convention,
statute, regulation, rule, ordinance, proclamation,
by-law, judgment, rule of common law or equity or
rule of any applicable stock exchange;
(B) is a reference to that law as amended, consolidated,
supplemented or replaced; and
(C) is a reference to any regulation, rule, ordinance,
proclamation, by-law or judgment made under that law;
(ix) to proceedings includes litigation, arbitration, and
investigation;
(x) to a judgement includes an order, injunction, decree,
determination or award of any court or tribunal; and
(xi) to time is a reference to Sydney time;
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(b) headings are for convenience only and are ignored in interpreting this
Deed;
(c) if a period of time is specified and dates from, after or before, a
given day or the day of an act or event, it is to be calculated
exclusive of that day;
(d) if a payment or other act must (but for this clause) be made or done on
a day which is not a Business day, then it must be made or done on the
next Business day;
(e) the words "including" or "includes" mean "including but not limited to"
or "including without limitation;
(f) this Deed must not be construed adversely to a party solely because
that party was responsible for preparing it; and
(g) where a word or phrase is defined, its other grammatical forms have a
corresponding meaning.
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2. COMMENCEMENT OF OBLIGATIONS ON CLOSING
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Unless expressly stated otherwise in this Deed, the rights and obligations
created by this Deed commence, and are enforceable from the date of this Deed.
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3. THE BUSINESS
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The primary object of the Company is to conduct the Business in accordance with
the Business Plan as amended from time to time.
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4. MANAGEMENT OF THE COMPANY
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4.1 APPOINTMENT OF DIRECTORS
(a) For so long as it holds 20 in number or two thirds of the Shares, Asia
Online--Australia is entitled to appoint, substitute and remove 3
Directors.
(b) Subject to clause 4.1(c), for so long as they hold the Initial Shares
or one third of the Shares, the Original Shareholders are collectively
entitled to appoint, substitute and remove a total of 2 Directors.
4.2 MANNER OF APPOINTMENT
Each appointment, substitution and removal of a Director will be carried out by:
(a) the relevant Member(s) depositing a written notice at the Company's
registered office; and
(b) sending a copy of the notice to the other Members.
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4.3 RESIGNATION ON DISPOSAL
If Asia Online-Australia disposes of all its Shares or the Original Shareholders
dispose of all of their Shares, that Member or those Members must cause the
resignation of the relevant Director(s) appointed by it or them.
4.4 LIABILITY FOR REMOVAL
Any Member substituting or removing a Director using its rights under this
clause 4 is responsible for and holds harmless the other Members and the Company
from and against:
(a) any claim for unfair or wrongful dismissal arising out of the
substitution or removal; and
(b) any reasonable costs and expenses incurred in defending any
proceedings, including, but without limiting this, legal costs on a
solicitor and own client basis.
4.5 MEETINGS OF THE BOARD
(a) Subject to clause 4.5(b) below, at each meeting of the Board and for
each resolution proposed to the Board the Directors present at the
meeting will have one vote each.
(b) If less than the full number of AOA Directors or Original Shareholders
Directors are appointed to the Board or attend or are able to vote at
any Board meeting, the AOA Director(s) or Original Shareholders
Director(s) that attend are entitled to exercise between them the
number of votes that equal the maximum number of AOA Directors entitled
to be appointed under clause 4.1(a) (in the case of any votes exercised
by the AOA Directors) and the maximum number of Original Shareholders
Directors entitled to be appointed under clause 4.1(b) (in the case of
any votes exercised by the Original Shareholders Directors).
(c) Subject to clause 5.1 all resolutions of the Board must be passed by
simple majority.
(d) The quorum for a Board meeting is at least one AOA Director and one
Original Shareholders Director.
4.6 SHAREHOLDERS MEETINGS
(a) The quorum for a general meeting is at least two Members, one of which
must be Asia Online--Australia and one of which must be an Original
Shareholder.
(b) At each meeting of the Members and for each resolution proposed to the
Members, each Member has one vote for each Share it holds.
4.7 CHAIRMAN
(a) Asia Online-Australia has the right to nominate one of the AOA
Directors to be Chairman. If the Chairman ceases to be a Director, Asia
Online--Australia will be entitled to nominate a replacement Chairman.
(b) The Chairman is entitled to a second or casting vote.
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5. MATTERS REQUIRING UNANIMOUS CONSENT
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5.1 UNANIMOUS CONSENT
The Members agree that despite anything to the contrary in this Deed, or in the
Constitution, the unanimous consent of the Members is required to:
(a) create or, where appropriate, issue any Security Interest over the
whole or any part of the undertaking, business, property or assets
(tangible or intangible) of the Company;
(b) sell, transfer, lease, assign, dispose of or part with control of any
interest in all or any material part of the undertaking, business,
property or assets (tangible or intangible) of the Company (whether by
a single transaction or a series of transactions) or contract to do so
(other than as a result of any group reorganisation or reconstruction
of the Company or any material part of its assets);
(c) acquire or contract to acquire any business, property or assets
(tangible or intangible) or any interest therein which represents more
than 20% of the Company's assets at the relevant time (other than as a
result of any group reorganisation or reconstruction of the Company or
any material part of its assets);
(d) enter into any joint venture, partnership or profit sharing agreement
with any third party; or
(e) issue further shares.
In clause 5.1 "material part" means any part or parts of the undertaking,
business, property or assets having a value of at least 20% of the Company's
assets at the relevant time.
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6. TRANSFER OF SHARES
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6.1 NO DEALING IN SHARES
A Member may not sell, transfer or dispose of any Shares or any interest in any
Shares or charge or otherwise encumber or create any Third Party Interest in any
Shares without the prior consent of the other Members, except as provided in
this Deed.
6.2 TRANSFER TO RELATED BODY CORPORATE
A transfer of Shares to a transferee who is and remains a Related Body Corporate
of the transferor Member is permitted if:
(a) the transferor Member has given prior written notice to the other
Members; and
(b) the transferee executes and delivers to the Company a Deed of Adherence
at the same time as the transfer.
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7. WARRANTIES
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7.1 WARRANTIES BY THE MEMBERS
Each Member warrants to the other Members that:
(a) the execution of this Deed by it has been properly authorised by all
necessary corporate or other action by it;
(b) it has full corporate authority or statutory power, as the case may be,
and lawful authority, to execute and deliver this Deed and to perform
or cause to be performed its obligations under this Deed;
(c) this Deed constitutes a full and binding legal obligation upon it; and
(d) this Deed does not conflict with or result in the breach of or default
under the provision of its constitution or other constituent documents
or any material term or provision of any agreement or deed or any writ
order or injunction, rule, judgment, law, or regulation to which it is
a party or is subject or by which it is bound.
7.2 WARRANTY BY THE ORIGINAL SHAREHOLDERS
Each of the Original Shareholders warrants that:
(a) upon entering into this Deed he is either a director or executive
officer of the Company or a close relative (as defined in Section
66(3)(e) of the Corporations Law) of such a person;
(b) at Completion he will be the legal and beneficial owner of the Shares
and the Shares will be transferred to Asia Online-Australia free of all
Third Party Interests.
7.3 AOA WARRANTIES
Asia Online-Australia represents and warrants to the Original Shareholders in
terms of the AOA Warranties.
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8. SHARE SALE
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8.1 SALE OF INITIAL SHARES
The Original Shareholders agree to sell and Asia Online-Australia agrees to
purchase for the Purchase Price, all the Original Shareholders' right, title and
interest in the Initial Shares, free of all Third Party Interests, on the terms
and conditions contained in this Section 8.
8.2 CONDITIONS OF COMPLETION
Neither the Original Shareholders nor Asia Online-Australia shall be obliged to
complete the sale and transfer of the Initial Shares unless a Completion Event
occurs in which case:
(a) the Original Shareholders may require Asia Online-Australia to complete
the purchase of all, but not less than all, of their Initial Shares at
any time during the Completion Period on terms contained in clause 8.3;
and
(b) other than in cases of a group reorganisation or reconstruction
involving the Company or any material part of its assets, Asia
Online-Australia may require the Original Shareholders to complete the
purchase of all, but not less than all of the Original Shareholders'
Initial Shares at any time after the Completion Period on terms
contained in clause 8.4.
8.3 ORIGINAL SHAREHOLDERS ELECTION
(a) The Original Shareholders may only require Asia Online-Australia to
complete the purchase of the Initial Shares by the Original
Shareholders serving on Asia Online-Australia a Completion Notice
signed by all Original Shareholders.
(b) The Completion Notice must require the completion of the purchase of
all of the Initial Shares then held by the Original Shareholders.
(c) Upon service of a Completion Notice, Asia Online-Australia becomes
bound to complete the purchase of all the Initial Shares specified in
the Completion Notice at the Purchase Price within 45 days, subject to
any consent or approval (the "Approval") required from the Treasurer of
the Commonwealth of Australia under the Foreign Acquisitions and
Takeovers Act 1975. Subject to receipt of the Approval, Asia Online
will either offer that number of Asia Online Class C Non-Voting Common
Shares set out opposite each Original Shareholder's name in Schedule 1,
or if a Cash Election has been made under clause 8.8, pay the Purchase
Price to the Original Shareholders in the proportions set out against
their names in Schedule 1.
8.4 ASIA ONLINE--AUSTRALIA ELECTION
(a) Asia Online--Australia may only require the Original Shareholders to
complete the sale of the Initial Shares by Asia Online--Australia
serving on the Original Shareholders a Completion Notice signed by Asia
Online--Australia.
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(b) The Completion Notice must be for all the Initial Shares.
(c) Upon service of a Completion Notice, the Original Shareholders become
bound to sell the Shares specified in the Completion Notice at the
Purchase Price within 45 days subject to any consent or approval (the
"Approval") required from the Treasurer of the Commonwealth of
Australia under the Foreign Acquisitions and Takeovers Act 1975.
Subject to receipt of the Approval, Asia Online will either offer that
number of Asia Online Class C Non-Voting Common Shares set out opposite
each Original Shareholder's name in Schedule 1, or if a Cash Election
has been made under clause 8.8, pay the Purchase Price to the Original
Shareholders in the proportions set out against their names in Schedule
1.
8.5 COMPLETION
Within 10 days of service of the relevant Completion Notice (or, in the case of
a Completion Event which relates to an initial public offering of Asia Online on
a United States Stock Exchange, such shorter period as may be necessary to
ensure that the Original Shareholders are entitled to convert their Asia Online
Class C Non-Voting Common Shares into voting common shares in accordance with
Asia Online's restated certificate of incorporation) and subject to any consent
or approval required from the Treasurer of the Commonwealth of Australia under
the Foreign Acquisitions and Takeovers Act 1975:
(a) the Original Shareholders must deliver to Asia Online-Australia:
(i) transfers of all their Initial Shares duly executed by the
registered holders in favour of Asia Online-Australia together
with the relevant share certificates for those Shares; and
(ii) executed resignations of the Original Shareholders' Directors;
(b) Asia Online must deliver to each Original Shareholder either:
(i) the number of Asia Online Class C Non-Voting Common Shares set
out opposite each Original Shareholder's name in Schedule 1;
or
(ii) if a Cash Election has been made under clause 8.8, the
equivalent of the actual price at which the Asia Online stock
is to be issued in the initial public offering of Asia Online
on a US stock exchange multiplied by that number of Asia
Online Class C Non-Voting Common Shares set out opposite that
Original Shareholder's name in Schedule 1.
8.6 NOTICE OF COMPLETION EVENT
Asia Online-Australia must use its best endeavours to give reasonable prior
written notice to the Original Shareholders of the forthcoming occurrence of a
Completion Event.
8.7 NON-COMPLIANCE
(a) If any of the Original Shareholders fail to comply with clause 8.5(a)
(the party failing to comply being the "Defaulting Party"):
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(i) the parties acknowledge that damages will not be an adequate
remedy for any such failure and that Asia Online--Australia
shall be entitled to specific performance and other equitable
relief; and
(ii) the Defaulting Party irrevocably appoints Asia
Online-Australia as its attorney to execute all documents and
do all other things necessary or desirable to give effect to
this Deed and to complete the sale of the Shares and the
Defaulting Party indemnifies Asia Online Australia for all
costs and expenses howsoever arising from that appointment;
(iii) Asia Online-Australia will be entitled to be reimbursed by the
Defaulting Party for any costs incurred by it arising from any
action required to be taken under this clause 8.7.
8.8 CASH ELECTION
If there is an initial public offering of Asia Online on a US stock exchange
then, during the Completion Period, the Original Shareholders may unanimously
elect that the Purchase Price be paid in cash rather than by the issue of Asia
Online Class C Non-Voting Common Shares by serving on Asia Online--Australia a
written notice signed by all the Original Shareholders stating that they
unanimously elect that the Purchase Price be paid in cash.
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9. US SECURITIES LAWS REPRESENTATIONS AND UNDERTAKINGS
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9.1 DEFINITIONS
In this clause:
"ASIA ONLINE STOCK" means the Asia Online class C non-voting common stock to be
acquired under this Deed by each Regulation S Vendor;
"REGULATION S" means Regulation S promulgated by the SEC under the Securities
Act;
"REGULATION S SECURITIES" or the "SECURITIES" means collectively the Asia Online
Stock to be acquired under this Deed by each Original Shareholder;
"REGULATION S VENDOR" means an Original Shareholder;
"SEC" means the United States Securities and Exchange Commission;
"SECURITIES ACT" means the United States Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder;
"UNITED STATES" means the United States of America, its territories and
possessions, any state of the United States and the District of Columbia; and
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"US PERSON" has the meaning given to that expression in Rule 902 of Regulation
S.
9.2 WARRANTIES
Each Regulation S Vendor represents, warrants and undertakes to each other party
as follows:
(a) This Deed is entered into by each other party in reliance upon
Regulation S Vendor's representations, warranties and undertakings in
this clause.
(b) The Asia Online Stock to be acquired under this Deed by each Regulation
S Vendor will be acquired for investment for such Regulation S Vendor's
own account, not as a nominee or agent, and not with a view to the
resale or distribution of any part thereof in the United States or to a
United States resident (except in compliance with United States
securities laws), and that such Regulation S Vendor has no present
intention of selling, granting any participation in, or otherwise
distributing the same (except in compliance with United States
securities laws). By executing this Deed, each Regulation S Vendor
further represents, warrants and undertakes that such Regulation S
Vendor does not have any contract, undertaking, agreement or
arrangement with any person to sell, transfer or grant participations
to such person or to any third person in the United States or to a
United States resident, or any hedging transaction with any third
person in the United States or to a United States resident, with
respect to any of the Regulation S Securities.
(c) Each Regulation S Vendor understands and acknowledges that the Asia
Online Stock is not registered under the Securities Act on the ground
that the sale provided for in this Deed and the issuance of Securities
hereunder is exempt from registration under the Securities Act pursuant
to Regulation S thereof, and that Asia Online's reliance on such
exemption is predicated on the Regulation S Vendors' representations
set forth in this Deed.
(d) Each Regulation S Vendor has received all the information such
Regulation S Vendor considers necessary or appropriate for deciding
whether to purchase the Asia Online Stock.
(e) Each Regulation S Vendor has had an opportunity to ask questions and
receive answers from Asia Online regarding the terms and conditions of
the offering of the Asia Online Stock and the business, properties,
prospects, and financial condition of Asia Online and to obtain such
additional information (to the extent Asia Online possessed such
information or could acquire it without unreasonable effort or expense)
necessary to verify the accuracy of any information furnished to such
Regulation S Vendor or to which such Regulation S Vendor had access.
(f) Each Regulation S Vendor is either experienced in evaluating and
investing in securities of companies in the early stages of product
production or has access to appropriate advisers or representation that
can assist in evaluating companies in the early stages of product
production and acknowledges that such Regulation S Vendor is able to
fend for himself, herself or itself, can bear the economic risk of such
Regulation S Vendor's investment, and has such knowledge and experience
in financial and business matters that such Regulation S Vendor is
capable of evaluating the merits and risks of the investment in the
Asia Online Stock. If other
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than an individual, the Regulation S Vendor also represents, warrants
and undertakes that such Vendor has not been organized for the purpose
of acquiring the Asia Online Stock.
(g) Each Regulation S Vendor is a Qualified Regulation S Vendor. The term
"Qualified Regulation S Vendor" in this Deed means a person or entity
who is not a U.S. person, as such term is defined in Rule 902
promulgated under the Securities Act.
9.3 RESTRICTED SECURITIES
Each Regulation S Vendor understands that the Asia Online Stock may not be sold,
transferred, or otherwise disposed of without registration under the Securities
Act or an exemption therefrom, and that in the absence of an effective
registration statement covering the Asia Online Stock or an available exemption
from registration under the Securities Act, the Asia Online Stock must be held
indefinitely. In particular, each Regulation S Vendor is aware that the Asia
Online Stock may not be sold pursuant to Rule 144 promulgated under the
Securities Act unless all of the conditions of that Rule are met. Among the
conditions for use of Rule 144 may be the availability of current information to
the public about Asia Online. Such information is not now available and Asia
Online has no current plans to make such information available.
9.4 LEGENDS
To the extent applicable, each certificate or other document evidencing any of
the Asia Online Stock shall be endorsed with the legends set forth below:
(a) The following legend under the Securities Act:
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
SOLD, TRANSFERRED, ASSIGNED, PLEDGED, OR HYPOTHECATED UNLESS
AND UNTIL REGISTERED UNDER SUCH ACT, OR UNLESS THE COMPANY HAS
RECEIVED AN OPINION OF COUNSEL OR OTHER EVIDENCE SATISFACTORY
TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT
REQUIRED."
(b) As to Regulation S Securities, the following legend under the
Securities Act:
"THE SECURITIES REPRESENTED HEREBY HAVE BEEN ACQUIRED PURSUANT
TO REGULATION S OF THE SECURITIES ACT OF 1933, AS AMENDED (THE
'ACT'), AND MAY NOT BE SOLD, MORTGAGED, PLEDGED, HYPOTHECATED
OR OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE THEREWITH. IN
ADDITION, NO HEDGING TRANSACTION MAY BE CONDUCTED WITH RESPECT
TO THESE SECURITIES UNLESS SUCH TRANSACTIONS ARE IN COMPLIANCE
WITH THE ACT."
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<PAGE> 17
9.5 LOCK UP
Each Regulation S Vendor hereby undertakes that such Regulation S Vendor shall
not sell, transfer, make any short sale of, grant any option for the purchase
of, or enter into any hedging or similar transaction with the same economic
effect as a sale, or otherwise reduce its risk of ownership or investment in,
any common stock (or other securities) of Asia Online held by such Regulation S
Vendor (other than those included in the registration) for a period (if any)
specified by the representative of the underwriters of common stock (or other
securities) of Asia Online with respect to each such transaction not to exceed
one hundred eighty (180) days following the effective date of a registration
statement of Asia Online filed under the Securities Act. Asia Online may impose
stop-transfer instructions with respect to the shares of common stock (or other
securities) subject to the foregoing restriction until the end of said one
hundred eighty (180) day period. Each Regulation S Vendor agrees to execute and
deliver such other agreements as may be reasonably requested by Asia Online or
the underwriter which are consistent with the foregoing or which are necessary
to give further effect thereto. In addition, if requested by Asia Online or the
representative of the underwriters of common stock (or other securities) of Asia
Online, each Vendor shall provide, within ten (10) days of such request, such
information as may be required by Asia Online or such representative in
connection with the completion of any public offering of Asia Online's
securities pursuant to a registration statement filed under the Securities Act.
================================================================================
10. MUTUAL CO-OPERATION
--------------------------------------------------------------------------------
10.1 PRIMARY OBLIGATION
Each of the Members agrees that it will use all reasonable endeavours to promote
the business and profitability of the Company.
10.2 OBLIGATIONS OF MEMBERS
Each of the Members agrees with the other that this Deed is entered into between
them and will be performed by each of them in a spirit of good faith, mutual
cooperation, trust and confidence and that it will use all means reasonably
available to it (including its voting power whether direct or indirect, about
the Company) to give effect to the objectives of this Deed and to ensure that
the Company complies with its obligations.
================================================================================
11. NO PARTNERSHIP AND CONFLICT
--------------------------------------------------------------------------------
11.1 NO PARTNERSHIP
(a) The parties' rights and obligations are not joint, or joint and
several, or collective. Each party is only responsible for its own
obligations as set out in this Deed.
(b) The parties do not intend to create, and this Deed does not constitute,
a partnership, agency, trust or other arrangement.
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<PAGE> 18
(c) Unless otherwise expressly stated in this Deed, neither party has the
authority to act for, or incur any obligation on behalf of, the other
party.
11.2 CONFLICT WITH CONSTITUTION
To the extent that the Constitution conflicts with the provisions of this Deed,
the parties will exercise their respective voting rights as Members of the
Company and take all such further steps as may be necessary to ensure that the
provisions of this Deed prevail and are given full force and effect.
================================================================================
12. NOTICES
--------------------------------------------------------------------------------
The notice provisions in clause 10.3 of the Sale Agreement apply mutatis
mutandis to this Deed.
================================================================================
13. GENERAL PROVISIONS
--------------------------------------------------------------------------------
13.1 INVALID OR UNENFORCEABLE
If a provision of this Deed is invalid or unenforceable in a jurisdiction:
(a) it is read down or severed in that jurisdiction to the extent of the
invalidity or unenforceability; and
(b) it does not affect the validity or enforceability of:
(i) that provision in another jurisdiction; or
(ii) the remaining provisions.
13.2 WAIVER AND EXERCISE OF RIGHTS
The waiver provisions in clause 10.10 of the Sale Agreement apply mutatis
mutandis to this Deed.
13.3 AMENDMENT
This Deed may be amended only by a written document signed by all parties.
13.4 COUNTERPARTS
(a) This Deed may be signed in counterparts and all counterparts taken
together constitute one document.
(b) Once all counterparts have been executed, each counterpart is an
effective instrument.
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<PAGE> 19
13.5 FURTHER ASSURANCES
Each party must, at its own expense, whenever requested by another party,
promptly do or cause to be done everything reasonably necessary to give full
effect to this Deed and the transactions contemplated by this Deed.
13.6 COSTS
Each party must pay its own costs in respect of this Deed and the documents and
transactions contemplated by this Deed.
13.7 ASSIGNMENT
A party must not assign, create an interest in or deal in any other way with any
of its rights under this Deed without the prior written consent of the other
parties.
13.8 NON-MERGER
The representations and covenants by the parties in this Deed are continuing and
will not merge or be extinguished on Completion and will survive after
Completion.
13.9 ENTIRE DEED
This Deed comprises the entire agreement of the parties about the subject matter
of this Deed.
13.10 RIGHTS CUMULATIVE
The rights, remedies and powers of the parties under this Deed are cumulative
and not exclusive of any rights, remedies or powers provided to the parties by
law.
13.11 CONSENTS AND APPROVALS
A party may give its consent conditionally or unconditionally or withhold its
approval or consent in its absolute discretion unless this Deed expressly
provides otherwise.
13.12 JURISDICTION AND GOVERNING LAW
The provisions of clause 10.7 of the Sale Agreement apply mutatis mutandis to
this Deed.
EXECUTED AS A DEED
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<PAGE> 20
SIGNED SEALED AND DELIVERED
for and on behalf of )
ASIA ONLINE LTD. )
by its duly authorised representative )
in the presence of: )
<TABLE>
<S> <C>
/s/ HUGH MCKELLAR /s/ KEVIN H. RANDOLPH
------------------------------------------ --------------------------------------------
Signature of authorised representative
Signature of witness
Hugh McKellar Kevin H. Randolph
------------------------------------------ --------------------------------------------
Name of witness (please print) Name of authorised representative
(please print)
SIGNED SEALED AND DELIVERED )
by BRENT PADDON )
in the presence of: )
/s/ IAN INNES /s/ BRENT PADDON
------------------------------------------ --------------------------------------------
Signature of witness Signature of BRENT PADDON
Ian Innes
------------------------------------------
Name of witness (please print)
SIGNED SEALED AND DELIVERED )
by BRETT GAVIN CAIRD )
in the presence of: )
/s/ IAN INNES /s/ BRENT GAVIN CAIRD
------------------------------------------ --------------------------------------------
Signature of witness Signature of BRETT GAVIN CAIRD
Ian Innes
------------------------------------------
Name of witness (please print)
</TABLE>
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<PAGE> 21
<TABLE>
<S> <C>
SIGNED SEALED AND DELIVERED )
by ASIA ONLINE--AUSTRALIA PTY LTD )
by a director and secretary/director )
/s/ JAMES EGAN /s/ KEVIN H. RANDOLPH
------------------------------------------ -------------------------------------------
Signature of secretary/director Signature of director
JAMES EGAN Kevin H. Randolph
------------------------------------------ -------------------------------------------
Name of secretary/director (please print) Name of director (please print)
</TABLE>
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<PAGE> 22
SCHEDULE 1
ORIGINAL SHAREHOLDERS
<TABLE>
<CAPTION>
SHAREHOLDER PROPORTIONS (%) SHARES PURCHASE PRICE:
NUMBER OF ASIA ONLINE CLASS C
NON-VOTING COMMON SHARES
<S> <C> <C> <C>
Brent Paddon
Unit 3
27 Cadell Street 50 5 107,539
Toowong Qld 4066
Brett Gavin Caird
53 Raff Avenue
Holland Park Qld 4121 50 5 107,539
</TABLE>
19
