EXHIBIT 4.7
THIS AGREEMENT is made on the 14 day of January 2002
AMONGST:
(1) NAM TAI ELECTRONICS, INC, a company incorporated in the British Virgin
Islands whose registered office is at 2nd Floor, 116 Main Street, Road
Town, Tortola, British Virgin Islands and with Registration Number 3805
(the INVESTOR);
(2) J.I.C. TECHNOLOGY COMPANY LIMITED, a company incorporated in the Cayman
Islands whose registered office is at Codan Trust Company (Cayman)
Limited Century Yard, Cricket Square, Hutchins Drive, PO Box 2681 GT,
George Town, Grand Cayman, Cayman Islands (the COMPANY);
(3) ALBATRONICS (FAR EAST) COMPANY LIMITED (IN LIQUIDATION) (Company Number
181207) whose registered office is at 21st Floor, Edinburgh Tower, The
Landmark, 15 Queen's Road Central, Hong Kong Special Administrative
Region (ALBATRONICS) acting by the Joint Liquidators (as defined below);
and
(4) MESSRS. JOHN JAMES TOOHEY and DAVID CHUNG WAI NG, the Joint and Several
Liquidators of Albatronics, of 21st Floor, Edinburgh Tower, The
Landmark, 15 Queen's Road Central, Hong Kong acting without personal
liability (the JOINT LIQUIDATORS).
WHEREAS:
(A) Albatronics was incorporated in Hong Kong in 1987 and its shares have
been listed on the Stock Exchange of Hong Kong Limited (the STOCK
EXCHANGE) since 1994.
(B) The Joint Liquidators were appointed as joint and several liquidators to
Albatronics by virtue of a Special Resolution passed at an Extraordinary
General Meeting of the members of Albatronics duly convened and held on
20 August 1999 (the MEMBERS' MEETING) and confirmed at a meeting of the
creditors of Albatronics held on the same date. At the members' meeting,
a special resolution was passed to wind up Albatronics voluntarily
pursuant to section 228(1) of the Companies Ordinance and the Joint
Liquidators were appointed as the Joint and Several Liquidators of
Albatronics.
(C) Based on the information disclosed in the latest audited accounts of
Albatronics available to the Joint Liquidators, the authorised share
capital of Albatronics as at the commencement of its winding up on 20
August 1999 was HK$100,000,000 divided into 1,000,000,000 ordinary
shares of HK$0.10 each of which, based on the list of shareholders
available from the register of members of Albatronics as at 20 August
1999, 400,002,000 had been issued and were fully paid or credited as
fully paid.
(D) Trading in the securities of Albatronics on the Stock Exchange has been
suspended since 2 July 1999. The Stock Exchange has commenced procedures
to cancel the listing of the securities of Albatronics. Albatronics was
put into the third stage of the delisting procedures provided for in
Practice Note 17 to the Listing Rules (as defined below) by the Stock
Exchange on 7 August 2000.
(E) The Preliminary Agreement was signed on 15 November 2001 in relation to
a restructuring proposal for Albatronics submitted to the Joint
Liquidators by Yu Ming Investment Management Limited with the support of
the Investor.
(F) On 11 December 2001, a revised restructuring proposal was submitted to
the Stock Exchange pursuant to which it was proposed, inter alia, that
the Schemes (as defined below) be implemented, the listing of the Scheme
Shares (as defined below) be withdrawn and the Shares (as defined below)
be listed on the Stock Exchange by way of introduction.
(G) Following the submission of the revised restructuring proposal to the
Stock Exchange on 11 December 2001, further amendments have been made
this proposal and the Stock Exchange has extended the third stage of the
delisting procedures to 31 May 2002 (subject to certain conditions).
(H) This Agreement sets out in detail the terms and conditions of the
Proposals and conditions for the implementation of the Proposals through
the Schemes. The parties to this Agreement acknowledge that, prior to
the Schemes becoming effective, further agreements supplemental to this
Agreement may be entered into among the parties to this Agreement (or
some of them) for the purposes of implementing the Proposals.
NOW IT IS AGREED:
DEFINITIONS AND INTERPRETATION
1.1 In this Agreement the following terms shall have the following meanings:
ACQUISITION means the proposed reorganisation of the Group (as defined below)
involving the acquisition of the entire issued share capital of JIC (as defined
below) by the Company (as defined below) pursuant to the Acquisition Agreement
prior to the proposed listing of the Shares on the Stock Exchange;
ACQUISITION AGREEMENT means an agreement for the acquisition of the entire
issued share capital of JIC (as defined below) by the Company to be entered into
between the Company and the Investor, a draft copy of which is attached in
Schedule 1 to this Agreement.
ADMITTED CREDITORS means the creditors of Albatronics to the extent their claims
have been admitted to prove in the liquidation of Albatronics at any time prior
to the Effective Date (as defined below);
ALBATRONICS GROUP means Albatronics and its subsidiaries from time to time;
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BUSINESS DAY means a day upon which banks are open for business in Hong Kong
(other than Saturday);
CODE means the Hong Kong Code on Takeovers and Mergers issued by the SFC;
COI means the Committee of Inspection of Albatronics appointed on 20 August 1999
pursuant to section 206 of the Companies Ordinance, details of the composition
of which are set out in Schedule 7 to this Agreement;
COMPANIES ORDINANCE means the Companies Ordinance (Chapter 32 of the Laws of
Hong Kong);
COMPLETION means completion of the Proposals contemplated in this Agreement and
set out in Clause 4;
CONDITIONS PRECEDENT means the conditions precedent set out in Clause 3.1;
COURT means the High Court of Hong Kong;
COURT ORDER means the Orders of the Court sanctioning each of the Schemes (as
defined below) pursuant to section 166 of the Companies Ordinance.
CREDITORS' SCHEME means a scheme of arrangement to be proposed between
Albatronics and the Admitted Creditors pursuant to section 166 of the Companies
Ordinance and as described in Clause 2.2 and on substantially the terms set out
in Schedule 3;
DEPOSIT means the Deposit as defined in the Preliminary Agreement (as defined
below).
EFFECTIVE DATE means the first date on which the both Schemes, if approved,
become effective pursuant to section 166 of the Companies Ordinance;
GROUP means the Company and its subsidiaries, upon completion of this Agreement;
HK$ means Hong Kong dollars, the lawful currency for the time being of Hong
Kong;
HONG KONG means the Hong Kong Special Administrative Region of the People's
Republic of China;
INITIAL CONVERSION RATIO means the conversion of the Preference Shares (as
defined below) at the rate of 1 Share (as defined below) for every 1.03
Preference Shares.
JIC means JIC Group (BVI) Limited, a company incorporated in the British Virgin
Islands, with Registration Number 409529, and having its registered office at
the offices of Caribbean Corporate Services Limited, 3rd Floor, Omar Hodge
Building, Wickhams Cay I, PO Box 362, Road Town, Tortola, the British Virgin
Islands.
LISTING RULES means the Rules Governing the Listing of Securities on the Stock
Exchange;
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MAIN BOARD means the stock market operated by the Stock Exchange prior to the
establishment of the Growth Enterprise Market (excluding the options market) and
which stock market continues to be operated by the Stock Exchange in parallel
with the Growth Enterprise Market;
NOTICES OF COURT MEETINGS means both the Notice of Shareholders' Court Meeting
(as defined below) and the Notice of Admitted Creditors' Court Meeting (as
defined below).
PREFERENCE SHARES means non-voting convertible preference shares of nominal
value of HK$0.01 each in the capital of the Company, and enjoying substantially
the rights and benefits as set out in Schedule 4;
PRELIMINARY AGREEMENT means the agreement dated 15 November 2001 entered into
between (1) the Investor, (2) Yu Ming (as defined below) and (3) the Joint
Liquidators.
PROPOSALS means the proposals by the Company to effect, pursuant to the Schemes
(as defined below) a listing of the Shares (as defined below) of the Company on
the Main Board, the terms of which are set out in Clause 2;
RECORD DATE means the date for determining the entitlement of the holders of
Scheme Shares (as defined below) to Shares (as defined below) under the
Shareholders' Scheme (as defined below), being the business day immediately
preceding the date on which the Notice of Shareholders' Court Meeting (as
defined below) is dispatched;
REGISTER means the register of members of Albatronics;
RESTRUCTURING DOCUMENTS means this Agreement, the Acquisition Agreement and any
other ancillary agreements and documents entered into or executed prior to
Completion for the purposes of implementing all or any part of the Proposals;
SCHEME DOCUMENTS means the documents setting out, inter alia, details of the
Schemes and the Proposals and including, without limitation:
(a) a notice of the meeting of the Shareholders convened at the direction of
the Court (the NOTICE OF SHAREHOLDERS' COURT MEETING) in relation to the
approval of the Shareholders' Scheme (as defined below) on substantially
the terms as set out in Schedule 5;
(b) a notice of the meeting of the Admitted Creditors convened at the
direction of the Court (the NOTICE OF ADMITTED CREDITORS' COURT MEETING)
in relation to the approval of the Creditors' Scheme on substantially
the terms as set out in Schedule 6;
(c) the Shareholders' Scheme (as defined below) on substantially the terms
as set out in Schedule 2;
(d) the Creditors' Scheme on substantially the terms as set out in Schedule
3;
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SCHEME SHARES means all the shares in Albatronics in issue on the Record Date;
SCHEMES means the Shareholders' Scheme and the Creditors' Scheme;
SFC means the Securities and Futures Commission of Hong Kong;
SHAREHOLDERS means holders of the Scheme Shares;
SHAREHOLDERS' SCHEME means the scheme of arrangement to be proposed between
Albatronics and the Shareholders pursuant to Section 166 of the Companies
Ordinance and as described in Clause 2.1 and on substantially the terms set out
in Schedule 2;
SHARES means the ordinary shares in the capital of the Company;
SHARE OPTION SCHEME means a share option scheme to be adopted by the Company
complying with Chapter 17 of the Listing Rules.
YU MING means Yu Ming Investment Management Limited, a company incorporated in
Hong Kong and having its registered office at Suite 51, 5th Floor, New Henry
House, 10 Ice House Street, Central, Hong Kong.
1.2 In this Agreement:
(a) the Recitals form an integral part of this Agreement;
(b) the headings are for convenience only and shall not affect its
interpretation;
(c) expressions defined in the Companies Ordinance as amended from time to
time shall have the same meanings in this Agreement, unless the context
requires otherwise or they are otherwise defined in this Agreement;
(d) a reference to a provision of law includes a reference to any provision
which from time to time amends, extends, consolidates or replaces that
provision and any subordinate legislation made under any such provision;
(e) words denoting the singular number shall include the plural, the
masculine gender shall include the feminine gender and neuter, and vice
versa;
(f) a Clause or a Schedule is a reference to a clause or a schedule to this
Agreement;
(g) references to a person include an individual, a body corporate, a
partnership, any other unincorporated body or association or persons and
any state or state agency.
(h) the expressions Albatronics, Joint Liquidators, the Investor and the
Company shall, where the context permits, include their respective
successors and personal representatives; and
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(i) a time of day is a reference to the time in Hong Kong, unless expressly
intended otherwise.
THE PROPOSALS
SHAREHOLDERS' SCHEME
2.1 The Shareholders' Scheme shall be implemented on the basis of the Scheme
Documents, to achieve the following:
(a) all the Scheme Shares in issue on the Record Date shall be transferred
pursuant to the Shareholders' Scheme to the Company free from all liens,
charges and encumbrances and together with all rights attaching thereto
as at the Effective Date;
(b) as consideration for, inter alia, the acquisition by the Company of the
Scheme Shares pursuant to the Shareholders' Scheme, the Company shall
allot and issue (credited as fully paid) to the holders of Scheme Shares
whose names appear on the Register at the close of business on the
Record Date, subject to the provisions in clauses 9 and 10, 1 Share for
every 90 Scheme Shares held by them amounting to a total of 4,444,465
Shares, representing approximately 2.4% of the issued ordinary share
capital of the Company as enlarged by implementation of the Proposals
following Completion and approximately 0.6% of the issued share capital
of the Company as enlarged by implementation of the Proposals and
assuming conversion in full of the Preference Shares into Shares at the
Initial Conversion Ratio;
(c) upon due completion of the steps in paragraphs (a) and (b) above, all
the Scheme Shares received by the Company shall be transferred to the
Joint Liquidators or their nominee for a nominal consideration of
HK$1.00; and
(d) all Shares to be issued to the holders of the Scheme Shares upon
implementation of the Shareholders' Scheme shall be allotted and issued
free from all claims, charges, liens, encumbrances and equities and the
Shares shall rank pari passu in all respects with the Shares then in
issue, including for all dividends and other distributions (if any)
declared, paid or made after the date of such issue of such Shares.
CREDITORS' SCHEME
2.2 The Creditors' Scheme shall be implemented on the basis of the Scheme
Documents to achieve the following:
(a) as part of the consideration for the approval by the Admitted Creditors
of the Creditors' Scheme, the Company will issue to the Admitted
Creditors and/or their nominees(s) (in proportion to their admitted
claims in the liquidation as the Joint Liquidators may direct)
44,000,000 Shares, credited as fully paid, amounting to approximately
24.1% of the issued ordinary share capital of the Company as enlarged by
implementation of the Proposals at Completion and approximately 5.8% of
the issued ordinary share capital of the Company as
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enlarged by the implementation of the Proposals at Completion and
assuming conversion in full of the Preference Shares into Shares at the
Initial Conversion Ratio, subject to the provisions in Clauses 9 and 10;
(b) as further consideration for the approval by the Admitted Creditors of
the Creditors' Scheme, the Company will, on behalf of the Admitted
Creditors, issue to the Investor or its nominee(s), 4,100,000 Shares,
credited as fully paid, amounting to approximately 2.2% of the issued
ordinary share capital of the Company as enlarged by implementation of
the Proposals at Completion and approximately 0.5% of the issued
ordinary share capital of the Company as enlarged by the implementation
of the Proposals at Completion and assuming conversion in full of the
Preference Shares into Shares at the Initial Conversion Ratio, subject
to the provisions in Clauses 9 and 10, such Shares being issued in full
and final settlement of the Deposit and a sum of HK$100,000 which on or
prior to Completion will have been paid by the Investor to the Joint
Liquidators pursuant to the Preliminary Agreement; and
(c) all Shares to be issued under this Clause 2.2 upon implementation of the
Creditors' Scheme shall be allotted and issued free from all claims,
charges, liens, encumbrances and equities and shall rank pari passu in
all respects with the Shares then in issue, including the full for all
dividends and other distributions (if any) declared, paid or made after
the date of issue of such Shares.
ACQUISITION
2.3 In consideration for the acquisition by the Company of the entire issued
share capital of JIC pursuant to the Acquisition Agreement, the Company
shall allot and issue, credited as fully paid:
(a) 122,190,000 Shares to the Investor or its nominee (or at its direction),
representing approximately 66.9% of the issued ordinary share capital of
the Company as enlarged by implementation of the Proposals at Completion
and approximately 16.0% of the issued ordinary share capital of the
Company as enlarged by the implementation of the Proposals at Completion
and assuming conversion in full of the Preference Shares into Shares at
the Initial Conversion Ratio;
(b) At the request of the Investor, 7,810,000 Shares to Yu Ming or its
nominee, representing approximately 4.3% of the issued ordinary share
capital of the Company as enlarged by implementation of the Proposals at
Completion and approximately 1.0% of the issued ordinary share capital
of the Company as enlarged by the implementation of the Proposals at
completion and assuming conversion in full of the Preference Shares into
Shares at the Initial Conversion Ratio, such Shares being issued as
reimbursement of the provision of professional advisory services to the
Investor in relation to the restructuring of Albatronics; and
(c) 598,420,000 Preference Shares to the Investor or its nominee (or at its
direction).
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2.4 All Shares and Preference Shares to be issued pursuant to the
Acquisition Agreement shall be allotted and issued free from all claims,
charges, liens, encumbrances and equities and such Shares shall rank
pari passu with the Shares then in issue including for all dividends and
other distributions declared, paid or made after the date of such issue
of Shares.
CONDITIONS PRECEDENT
3.1 The Proposals are conditional upon satisfaction of the following Conditions
Precedent:
(a) the Acquisition Agreement becoming unconditional and being completed in
accordance with its terms;
(b) the Shareholders' Scheme having come into effect in accordance with its
terms and conditions, subject to any modification to such terms and
conditions imposed by the High Court of Hong Kong, in which case further
subject to agreement by the Investor and the Company as to the terms and
conditions of such modifications to the terms and conditions with the
consent of the High Court of Hong Kong, an office copy of the Court
order sanctioning the Shareholders' Scheme being delivered to the
Registrar of Companies in Hong Kong for registration in accordance with
section 166 of the Companies Ordinance;
(c) the Creditors' Scheme coming into effect in accordance with its terms
and conditions, subject to any modifications to such terms and
conditions imposed by the Court, in which case further subject to
agreement by the Investor and the Company as to the terms and conditions
of such modifications, and with the consent of the Court, an office copy
of the of the Court Order sanctioning the Creditors' Scheme being
delivered to the Registrar of Companies in Hong Kong for registration in
accordance with section 166 of the Companies Ordinance.
(d) the passing by the eligible Shareholders of resolutions at an
extraordinary general meeting approving, inter alia, this Agreement and
the transactions contemplated herein, any other resolutions as may be
required under the Listing Rules or by the Stock Exchange and, if
considered fit, for the purposes of making any amendments to the
memorandum and articles of association of Albatronics, as may be
necessary for the implementation of the Proposal or for the purpose of
assisting the transfer of the Scheme Shares to the Company under the
Shareholders' Scheme;
(e) the Listing Committee of the Stock Exchange granting the listing of and
permission to deal in the Shares in issue and to be issued pursuant to
the Schemes, the Acquisition Agreement, upon the conversion of the
Preference Shares and on the exercise of the option granted under the
Share Option Scheme;
(f) confirmation by the SFC in terms satisfactory to the Investor that the
implementation of the Proposals will not give rise to any obligation on
the part
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of the Company and/or its shareholders (whether direct or indirect) to
make a general offer to acquire all the Scheme Shares and/or the Shares
under the Code;
(g) the directors of the Investor and/or the Company undertaking to the
Stock Exchange in terms reasonably satisfactory to them to take
appropriate steps to ensure that a sufficient public float will exist
for the Shares as required under the Listing Rules following Completion,
and/or the provision by the relevant person(s) of any other
undertakings(s) as the Stock Exchange may require for such purposes;
(h) all consents and approvals from all other governmental and regulatory
authorities necessary for the implementation of the Proposals having
been obtained; and
(i) the audited consolidated net tangible assets of JIC as at 31 December
2001 as shown in the document to be issued pursuant to the Listing Rules
to Shareholders and Admitted Creditors seeking approval of the Schemes
not being less than HK$95,000,000.
3.2 The Conditions Precedent referred to in Clause 3.1 (other than (f) and (i))
may be waived or varied, wholly or in part, at any time prior to their
satisfaction, by unanimous written agreement between all parties.
3.3 The condition precedent in Clause 3.1(f) may be waived unilaterally, in full
or in part, by the Investor.
3.4 The condition precedent in Clause 3.1(i) may be waived unilaterally, in full
or in part, by the Joint Liquidators at or prior to the despatch of the Scheme
Documents with the Notices of Court Meetings to the Scheme Shareholders and
Admitted Creditors, as relevant.
3.5 The Investor and the Joint Liquidators shall take all reasonable steps to
satisfy the Conditions Precedent in Clause 3.1 and thereafter implement or
procure the implementation of the Proposals as soon as reasonably practicable in
accordance with (but subject to) the terms of the Preliminary Agreement. To that
end, the parties hereto will provide such information and documents and shall do
or execute or procure to be done and executed all such acts, deeds, things and
documents as may be reasonably requested by the other for the purposes of or in
connection with the implementation of the Proposals, the Schemes, this
Agreement, the Acquisition Agreement and/or the transactions contemplated
thereunder and the listing of the Shares on the Main Board.
COMPLETION
4.1 Subject to Clause 4.2, Completion shall take place on the date falling
within six (6) days after the satisfaction (or waiver) of all the Conditions
Precedent set out in Clause 3.1 (or such other date as the parties hereto may
agree in writing) at a place as the parties hereto may agree.
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4.2 At Completion:
(a) the Joint Liquidators and/or the Company will procure the execution of
the instruments of transfer and bought and sold notes in respect of the
Scheme Shares by an agent duly authorised on behalf of the holders of
the Scheme Shares pursuant to the Court Order for the purpose of
effecting the transfer of the Scheme Shares to the Company pursuant to
Clause 2.1(a);
(b) the Company shall allot and issue the Shares as set out in Clauses
2.1(b), 2.2(a), 2.2(b), and 2.3(b);
(c) the Acquisition Agreement shall be completed in accordance with its
terms and the Company shall allot and issue the Shares on the basis set
out in Clauses 2.3(a) and the Preference Shares on the basis set out in
2.3(c);
(d) the Company shall enter the names of the holders of the Shares and
Preference Shares allotted and issued pursuant to Clause 4.2(b) and
4.2(c) into the register of members of the Company (without payment of
any registration fee, if any);
(e) the Company shall procure that valid share certificates in respect of
the Shares (each in a form complying with the Listing Rules) shall be
issued and despatched to the allottees pursuant to the allotment
referred to in Clause 4.2(b) and 4.2(c);
(f) the Company shall deliver the relevant instrument of transfer and bought
and sold note duly executed by the Company for the transfer of its
entire holding of Scheme Shares for a total consideration of HK$1.00 to
the Joint Liquidators or their nominee to be held by them as trustee for
the Admitted Creditors;
(g) the Joint Liquidators and/or the Company shall use their respective best
endeavours to procure the withdrawal of the listing of the Scheme Shares
from the Stock Exchange within five (5) days from Completion which date
shall, subject to approval by the Stock Exchange, be a date not later
than the second business day immediately prior to the date of listing of
the Shares; and
(h) any relevant provision of the Preliminary Agreement shall be observed,
in particular, Clause 5(a) of the Preliminary Agreement in favour of
Albatronics,
save to the extent such transactions may already have occurred prior to
Completion.
REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS BY INVESTOR AND THE COMPANY
5.1 The Investor and the Company hereby jointly and severally represent, warrant
and undertake to the Joint Liquidators that:
(a) the Shares to be issued upon implementation of the Shareholders' Scheme
and Creditors' Scheme will be allotted and issued credited as fully paid
up and free from all claims, charges, liens, encumbrances and equities
and the Shares fully paid (without any cash payment being required by
the Company) and shall
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rank pari passu in all respects with the then existing issued Shares
including the right to rank in full for all dividends and distributions
declared (if any), paid or made after the date of issue of such Shares;
(b) the Investor and the Company each has full power and authority to enter
into this Agreement and all necessary corporate action has been taken to
authorise the execution and performance of this Agreement;
(c) the Preference Shares to be issued upon implementation of the
Acquisition will be allotted and issued free from all claims, charges,
liens encumbrances and equities and the Preference Shares shall have the
rights set out in Schedule 4; and
(d) the allotment and issue of the Shares will not cause any breach of any
agreement to which any member of the Group is a party and will not
infringe or exceed any limits on, powers of, or restrictions on or the
terms of any contract, obligation or commitment whatsoever of the
Company and/or any of its subsidiaries and/or their respective boards of
directors;
5.2 The representations, warranties and undertakings given by the Investor and
the Company herein shall be deemed to be repeated on the date of Completion as
if given or made on such date, with reference in each case to the facts and
circumstances then subsisting and shall remain in full force and effect
notwithstanding Completion. The Investor and the Company undertake to notify the
Joint Liquidators of any matter or event coming to their attention prior to the
date of Completion which shows or may show any of the representations,
warranties and undertakings given by them to be or to have been untrue,
inaccurate or misleading.
5.3 Neither the Company nor the Investor shall at any time prior to or on the
date of Completion do or omit to do anything which causes any of the
representations, warranties and undertakings given by the Company or the
Investor herein to become untrue.
REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS BY ALBATRONICS
6 Albatronics represents, warrants and undertakes to the Company that:
(a) based on the information available to the Joint Liquidators, the
statements contained in Recitals (A), (B) and (C) are true and accurate
in all respects as at the date hereof; and
(b) this Agreement has been duly authorised and executed by, and constitutes
the legally binding obligations of, Albatronics.
TERMINATION
7.1 This Agreement shall terminate in the following circumstances:
(a) if the Preliminary Agreement is terminated in accordance with its terms;
and/or
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(b) if there occurs any material breach of this Agreement and any of the
other parties (being the parties not in breach) elects by written notice
to all other parties to terminate this Agreement; and/or
(c) save to the extent waived or varied, if the Conditions Precedent in
Clause 3.1 have not been fulfilled on or before 30 June 2002 (or such
other date as may be agreed in writing between the Investor and the
Joint Liquidators), and either the Investor or the Joint Liquidators
elect by written notice to all other parties to terminate this
Agreement.
7.2 Upon the termination of this Agreement the parties shall cease to have any
rights or obligations under this Agreement, without prejudice to the rights of
the parties in respect of antecedent breaches.
THE INVESTOR AND THE COMPANY'S COSTS AND EXPENSES
8.1 The terms of the Preliminary Agreement, including without limitation to
clauses 4, 5, 7 and 10 thereof, shall continue to apply in relation to all and
any fees, costs and expenses of Albatronics, the Joint Liquidators or the
Investor in connection with or reasonably incidental to the implementation of
the Proposals.
8.2 Subject to clause 8.1, but to avoid doubt, the scope of works for which the
Joint Liquidators will be primarily responsible shall include, but shall not be
limited to, seeking feedback from the Admitted Creditors at various stages of
the Proposal, preparing first drafts of this Agreement, reviewing the draft
prospectus and listing application, preparing the first draft of each of the
Scheme Documents, retaining independent financial advisors to advise minority
shareholders of Albatronics, preparing and presenting those applications to the
Court necessary to effect the Proposals, as well as all matters necessary and
incidental to meeting the Joint Liquidators' obligations under this Agreement.
OVERSEAS SHAREHOLDERS AND OVERSEAS ADMITTED CREDITORS
9. Where the allotment and issue of any Share to a holder of Scheme Shares
pursuant to the Shareholders' Scheme or to the Admitted Creditors pursuant to
the Creditors' Scheme may be prohibited by any relevant law or so prohibited
except after compliance with conditions or requirements which the directors of
the Company regard as unduly onerous by reason of delay, expense or otherwise,
the Company may allot and issue the relevant Shares to a nominee selected by the
directors of the Company who shall sell the same and account to such holder of
Scheme Shares or to such Creditor pursuant to the Creditors' Scheme for the net
proceeds of sale, after deduction of expenses (and if the directors of the
Company see fit, converted into the currency of the jurisdiction in which the
registered address of the relevant holder of Scheme Shares is situated) in full
satisfaction of such holder's or creditor's entitlements to the Shares to which
he would have become entitled to under the Shareholders' Scheme or the
Creditors' Scheme as the case may be, except that amounts of HK$100 or less will
be retained for the benefit of the Company.
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FRACTIONAL ENTITLEMENTS
10. Fractional entitlements under the Shareholders' Scheme and the Creditors'
Scheme will be aggregated and sold for the benefit of the Company. The net
proceeds from such sale will be used as additional working capital of the
Company.
STAMP DUTY
11. All Hong Kong stamp duty payable in respect of any transfers of the Scheme
Shares or any Shares in connection with the implementation of the Proposals
shall be borne and paid by the Company and/or the Investor.
ARRANGEMENTS FOR ODD LOT TRADING
12. The Company undertakes to arrange with a third party independent securities
firm to match, on a best efforts basis, the sale and purchase of odd lots of the
Shares during the period from the day of dealings in the Shares on the Stock
Exchange on the day falling one month after that date, both days inclusive, in
order to alleviate difficulties in trading odd lots of the Shares arising from
the share exchange under the Scheme.
NOTICES
13.1 Any notice or other communication to be given by one party to any other
party under, or in connection with, this Agreement shall be in writing and
signed by or on behalf of the party giving it. It shall be served by sending it
by fax to the number set out in Clause 13.2, or delivering it by hand, or
sending it by pre-paid recorded delivery, special delivery or registered post,
to the address set out in Clause 13.2 and in each case marked for the attention
of the relevant party set out in Clause 13.2 (or as otherwise notified from time
to time in accordance with the provisions of this Clause 13). Any notice so
served by hand, fax or post shall be deemed to have been duly given:
(a) in the case of delivery by hand, when delivered;
(b) in the case of fax, at the time of transmission;
(c) in the case of prepaid recorded delivery, special delivery or registered
post, at 10 am on the second Business Day following the date of posting,
provided that in each case where delivery by hand or by fax occurs after 5 pm on
a Business Day or on a day which is not a Business Day, service shall be deemed
to occur at 9 am on the next following Business Day.
References to time in this Clause are to local time in the country of the
addressee.
13.2 The addresses and fax numbers of the parties for the purpose of Clause 13.1
are as follows:
INVESTOR: Nam Tai Electronics, Inc.
Page 13
Address: c/o Nam Tai Group Management Limited,
15th Floor, China Merchants Tower, Shun
Tak Centre 168-200 Connaught Road
Central Hong Kong
Fax: +852 2263 1223
For the attention of: Mr M. K. Koo
THE COMPANY: J.I.C. Technology Company Limited
Address: c/o Nam Tai Group Management Limited,
15th Floor, China Merchants Tower, Shun
Tak Centre 168-200 Connaught Road
Central Hong Kong
Fax: +852 2263 1223
For the attention of: Mr Joseph Li
ALBATRONICS AND THE JOINT
LIQUIDATORS
Address: Albatronics (Far East) Company Limited
(in liquidation), c/o Mr James Toohey
and David Chung Wai Ng, Joint and
Several Liquidators of Albatronics, of
21st Floor, Edinburgh Tower, The
Landmark, 15 Queen's Road Central, Hong
Kong acting without personal liability
Fax: +852 2854 4300
For the attention of: Messrs. John James Toohey And David
Chung Wai Ng, Joint Liquidators of
Albatronics (Far East) Company Limited.
13.3 A party may notify any other party to this Agreement of a change to its
name, relevant addressee, address or fax number for the purposes of this Clause
13, provided that, such notice shall only be effective on:
(a) the date specified in the notice as the date on which the change is to
take place; or
(b) if no date is specified or the date specified is less than five (5)
business days after the date on which notice is given, the date
following five (5) business days after notice of any change has been
given.
Page 14
RIGHTS AND REMEDIES
14.1 No failure or delay by any party hereto in exercising any right or remedy
provided by law under or pursuant to this Agreement shall impair such right or
remedy or operate or be construed as a waiver or variation of it or preclude its
exercise at any subsequent time and no single or partial exercise of any such
right or remedy shall preclude any other or further exercise of it or the
exercise of any other right or remedy.
14.2 The rights and remedies of any party under or pursuant to this Agreement
are cumulative, may be exercised as often as such party considers appropriate
and are in addition to its rights and remedies under general law.
MISCELLANEOUS
TIME OF THE ESSENCE
15.1 Time is of the essence of this Agreement.
INVALIDITY
15.2 If any of the provisions of this Agreement becomes invalid, illegal or
unenforceable in any respect under any law, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired.
SEVERABILITY
15.3 Any provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining portions
hereof, and any such prohibition or unenforceability in any jurisdiction shall
not invalidate or render unenforceable such provision in any other jurisdiction.
ENTIRE AGREEMENT
15.4 This Agreement is in addition to and without prejudice to the Preliminary
Agreement (including, without limitation, clause 7 thereof), which continues in
full force and effect, save that the "Proposal" as referred to in the
Preliminary Agreement shall be deemed amended so as to refer to the Proposals
set our herein (but subject to the letter of confirmation dated 11 December 2001
from Yu Ming to one of the Joint Liquidators). In the event of any inconsistency
between the terms and conditions of the Preliminary Agreement and this
Agreement, the terms and conditions of this Agreement shall prevail. No party
has entered into this Agreement in reliance upon any representation, warranty or
undertaking which is not set out or referred to in this Agreement.
Page 15
COUNTERPARTS
15.5 This Agreement may be executed in any number of counterparts and by the
parties to it on separate counterparts, each of which shall be an original but
all of which together constitute one and the same instrument.
ASSIGNMENT
15.6 This Agreement shall not be novated or assigned without the written consent
of each of the parties hereto.
ANNOUNCEMENTS
15.7 Each of the parties hereto undertakes that, prior to Completion, it will
not make any announcement or disclosure in connection with this Agreement except
to the extent required by law, the Listing Rules, the Code, the Stock Exchange,
the SFC, the Court or any other authorities in all relevant jurisdictions in
connection with the Proposals, or unless the parties hereto shall have given
their consent to such announcement or disclosure.
VARIATION
15.8 No variation of this Agreement shall be effective unless made in writing
and signed by all the parties.
JOINT LIQUIDATORS' LIABILITY
16. The Joint Liquidators are entering into and signing this Agreement as joint
and several liquidators of Albatronics and any obligations upon them, or
representations or warranties given by them, in this Agreement are agreed to
solely in that capacity. The Joint Liquidators shall not incur any personal
liability whatsoever in respect of any matter referred to in this Agreement and
shall not have any liability in their capacities as liquidators of Albatronics,
subject to clause 7 of the Preliminary Agreement.
GOVERNING LAW AND JURISDICTION
17.1 This Agreement shall be governed by and construed in accordance with the
laws of Hong Kong.
17.2 Each party hereby submits to the non-exclusive jurisdiction of the courts
of Hong Kong in relation to all matters arising out of this Agreement.
IN WITNESS WHEREOF this Agreement has been executed on the day and year first
above written.
Page 16
SIGNED by )
)
for and on behalf of )
NAM TAI ELECTRONICS, INC. )
in the presence of: )
SIGNED by )
)
for and on behalf of )
J.I.C. TECHNOLOGY COMPANY LIMITED )
in the presence of: )
SIGNED by )
)
for and on behalf of )
ALBATRONICS (FAR EAST) )
COMPANY LIMITED (IN LIQUIDATION) )
by one of the Joint Liquidators )
John James Toohey )
as its agent and without personal liability )
in the presence of: )
SIGNED by )
JOHN JAMES TOOHEY )
for and on behalf of )
the Joint Liquidators to )
Albatronics (Far East) Company Limited )
in the presence of: )
Page 17
SCHEDULE 1
FORM OF DRAFT ACQUISITION AGREEMENT
Page 19
SCHEDULE 2
FORM OF SHAREHOLDERS' SCHEME
Page 20
H.C.M.P. [ /02]
IN THE HIGH COURT OF
THE HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF FIRST INSTANCE
MISCELLANEOUS PROCEEDINGS
--------------------
IN THE MATTER
OF
ALBATRONICS (FAR EAST) COMPANY LIMITED
(IN LIQUIDATION)
AND
IN THE MATTER OF THE COMPANIES ORDINANCE (CHAPTER 32)
-------------------
SCHEME OF ARRANGEMENT
BETWEEN
ALBATRONICS (FAR EAST) COMPANY LIMITED
(IN LIQUIDATION)
AND
THE SCHEME SHAREHOLDERS
(AS HEREINAFTER DEFINED)
-------------------
-------------------
THE SCHEME
-------------------
1. PRELIMINARY
1.1 In this Scheme, unless the context otherwise requires, words importing
the singular number shall include the plural and vice versa; persons
shall include bodies corporate and partnerships; and references to any
gender shall include all genders.
1.2 In this Scheme of Arrangement, unless inconsistent with the subject or
context, the following expressions shall bear the following meanings:
ACQUISITION AGREEMENT the agreement dated [____] between Nam Tai (as
defined below) and J.I.C. (as defined below) for
the acquisition of the entire issued share
capital of J.I.C. Group (BVI) Limited by J.I.C.
(as defined below);
ADMITTED CREDITORS the creditors of Albatronics (as defined below)
to the extent their claims have been admitted to
prove in the liquidation of Albatronics (as
defined below) at any time prior to the
Effective Date (as defined below);
ALBATRONICS Albatronics (Far East) Company Limited (in
liquidation) (Company Number 181207), a company
incorporated in Hong Kong with limited liability
and whose shares are listed on the main board of
the Stock Exchange and whose registered address
is 21st Floor, Edinburgh Tower, The Landmark, 15
Queen's Road Central, Hong Kong (as defined
below);
ALBATRONICS SHARES ordinary shares of HK$0.10 each in the existing
capital of Albatronics;
BUSINESS DAY a day upon which banks are open for business in
Hong Kong (other than a Saturday);
COMPANIES ORDINANCE the Companies Ordinance (Chapter 32 of the Laws
of Hong Kong (as defined below);
COURT the High Court of Hong Kong (as defined below);
CREDITORS' SCHEME the scheme of arrangement pursuant to section
166 of the Companies Ordinance to be entered
into between Albatronics and the creditors of
Albatronics, which upon its implementation and
the implementation of this Scheme will result in
the Admitted Creditors and/or their respective
nominee(s) receiving certain
New Shares (as defined below);
EFFECTIVE DATE has the meaning in Clause 4;
HONG KONG the Hong Kong Special Administrative Region of
the People's Republic of China;
J.I.C. J.I.C. Technology Company Limited, a company
incorporated in the Cayman Islands whose
registered office is at Codan Trust Company
(Cayman) Limited, Century Yard, Cricket Square,
Hutchins Drive, PO Box 2681 GT, George Town,
Grand Cayman, Cayman Islands and whose
Registration Number is [____];
JOINT LIQUIDATORS Messrs. John James Toohey and David Chung Wai
Ng, of 21st Floor, Edinburgh Tower, The
Landmark, 15 Queen's Road Central, Hong Kong,
having been appointed jointly and severally as
liquidators of Albatronics on 20 August 1999;
NAM TAI Nam Tai Electronics, Inc., a company
incorporated in the British Virgin Islands,
whose registered office is at 2nd Floor, 116
Main Street, Road Town, Tortola, British Virgin
Islands and with Registration Number 3805;
NEW SHARES new ordinary shares of J.I.C. of HK$0.01
each;
NOTICE OF the notice of the meeting of the Scheme
SHAREHOLDERS' COURT Shareholders convened at the direction of the
MEETING Court in relation to the approval of this
Scheme;
ORDER the order of the Court sanctioning this Scheme
(as defined below) pursuant to s.166 of the
Companies Ordinance;
PREFERENCE SHARES the Preference Shares of J.I.C. as defined in
the Restructuring Agreement (as defined below);
RECORD DATE the business day immediately preceding the date
on which the Notice of Shareholders' Court
Meeting is despatched;
REGISTER The register of members of Albatronics;
RESTRUCTURING the agreement dated [____] January 2002 entered
AGREEMENT into between Albatronics, Nam Tai, J.I.C. and
the Joint Liquidators;
SCHEME this scheme of arrangement in its present form
with or subject to any modification thereof or
addition thereto or condition approved or
imposed by the Court and approval by Albatronics
and Nam Tai as provided herein;
SCHEME SHARES the Albatronics Shares in issue as at the Record
Date;
SCHEME SHAREHOLDERS the holders of the Scheme Shares whose names
appear on the Register on the Record Date, and
each a "SCHEME SHAREHOLDER";
STOCK EXCHANGE the Stock Exchange of Hong Kong Limited;
HK$ Hong Kong dollars.
2. BACKGROUND
2.1 The Joint Liquidators were appointed as joint and several liquidators to
Albatronics by virtue of a special resolution passed at an extraordinary
general meeting of the members of Albatronics duly convened and held on
20 August 1999 and confirmed at a meeting of the creditors of
Albatronics held on the same date. At that members' meeting, a special
resolution was passed to wind up Albatronics voluntarily pursuant to
section 228(1) of the Companies Ordinance and the Joint Liquidators were
appointed as the joint and several liquidators of the Company.
2.2 The authorized share capital of Albatronics as at the commencement of
its winding-up on 20 August 1999 was HK$100,000,000 divided into
1,000,000,000 shares of HK$0.10 each of which 400,002,000 Scheme Shares
had been issued and were fully paid or credited as fully paid.
2.3 At the date hereof, Nam Tai and its subsidiaries beneficially own
200,402,000 Scheme Shares.
2.4 Pursuant to the Restructuring Agreement it was agreed, inter alia and
subject to certain conditions, that (i) the shareholders of Albatronics
will become shareholders of J.I.C. in accordance with this Scheme and
that (ii) the Admitted Creditors and/or their respective nominee(s) will
become shareholders of J.I.C. in accordance with the Creditors' Scheme.
2.5 Nam Tai will conditionally sell the entire share capital of J.I.C. Group
(BVI) Limited to J.I.C. pursuant to the Acquisition Agreement in
consideration of the issue and allotment by J.I.C. of 130,000,000 New
Shares and 598,420,000 Preference Shares credited as fully paid to Nam
Tai or its nominee(s).
2.6 Conditional upon, inter alia, this Scheme and the Creditors' Scheme
becoming effective, in consideration for the transfer of the Scheme
Shares to J.I.C. or its nominee(s), J.I.C. shall, on or within six (6)
Business Days from the Effective Date, or as soon as practical
thereafter, issue New Shares,
credited as fully paid, to the Scheme Shareholders on the basis of 1 New
Share for every 90 Scheme Shares held by them, provided that fractions
of a New Share will not be issued and all fractional entitlements will
be held for the benefit of J.I.C..
2.7 The primary purpose of this Scheme is for the Scheme Shareholders to
receive 1 New Share for every 90 Scheme Shares in consideration of the
transfer of the Scheme Shares to J.I.C. or its nominee(s), whereupon the
listing status of the Scheme Shares will be withdrawn and the New Shares
will be listed on the Stock Exchange by way of introduction. The Scheme
Shareholders would not otherwise receive such New Shares through the
liquidation of Albatronics.
2.8 J.I.C. has agreed to appear by Counsel at the hearing of the petition to
sanction this Scheme and to undertake to the Court to be bound thereby
and to execute and do or procure to be executed and done all such
documents, acts and things as may be necessary or desirable to be
executed or done by it for the purpose of giving effect to this Scheme
[and/or for the completion of the Acquisition Agreement].
3. THE ARRANGEMENT
3.1 On the Effective Date, the Scheme Shares shall be transferred or caused
to be transferred to J.I.C. (or its nominee(s)) free from all liens,
charges and encumbrances together with all rights then or thereafter
attached thereto and J.I.C. shall accept such transfer. For such
purposes:
(a) the Scheme Shares shall be transferred to J.I.C. and to give
effect to such transfers, a director or officer of J.I.C. or its
nominee(s) or any other person appointed by the board of
directors of J.I.C. to execute, on behalf of the transferor,
instruments of transfer in respect of any Scheme Shares and any
contract notes required pursuant to applicable law and any other
deeds or other documents necessary for the purpose of effecting
such transfer and the registration thereof, and every instrument
of transfer so executed shall be as effective as if it had been
executed by the Scheme Shareholders and all stamp duties (if
any) payable in respect of such instruments of transfer and
contract notes shall be paid by J.I.C. and such instruments of
transfer shall be accepted by Albatronics for registration in
the name(s) of J.I.C. or its nominee(s) notwithstanding the
absence of any share or other relevant certificate being lodged
in respect thereof;
(b) pending such registration and the name(s) of J.I.C. or its
nominee(s) being entered in the Register, all Scheme
Shareholders shall hold their respective Scheme Shares on trust
for J.I.C. and J.I.C. shall be entitled to direct the exercise
of any votes attaching to the Scheme Shares and shall be deemed
to be authorized by each Scheme Shareholder to sign any consent
to short notice of a general meeting on his behalf and/or to
execute a form of proxy in respect of his Scheme Shares
appointing any person determined by J.I.C. to attend general
meetings of Albatronics or its members (or any of them) and to
exercise the votes
attaching to his Scheme Shares on his behalf, and no Scheme
Shareholder shall be entitled to exercise any of such rights
without the consent of J.I.C. or to appoint a proxy for, or to
attend, a general meeting of Albatronics convened for a date
after the Effective Date; and
(c) notwithstanding the absence of any share certificate or other
document of title to the Scheme Shares, Albatronics and the
Joint Liquidators shall give such sanction, consent or approval
as may be required from them under the Companies Ordinance or
the articles of association of Albatronics in order to give
effect to the transfers and registration as set out in (a) and
(b) above and the Joint Liquidators shall, in their capacity as
joint and several liquidators of Albatronics and as authorized
by Albatronics as its agent for this purpose, be entitled to
execute all such instruments or other documents and to do all
such other acts and things as they may consider necessary or
desirable in order to give effect to this Scheme.
3.2 In consideration of the acquisition of the Scheme Shares, and subject to
clause 5, J.I.C. shall, on or within six (6) Business Days from the
Effective Date, or as soon as practical thereafter, allot and issue New
Shares credited as fully paid in the proportion of 1 New Share for every
90 Scheme Shares then held by them respectively, to the Scheme
Shareholders as appearing in the Register as at the Record Date, which
shares the Scheme Shareholders shall accept. Fractions of a New Share
will not be issued and all fractional entitlements will be aggregated
and held for the benefit of J.I.C.
3.3 In consideration of the benefits set out in Clause 3.1, on the Effective
Date, the Scheme Shareholders agree to accept the benefits under this
Scheme as full and final discharge of their right to consent to any
other scheme of arrangement which would assist a company to obtain the
listing status of Albatronics.
3.4 The Scheme Shareholders agree that, insofar as they may have an interest
in the listed status of Albatronics, they consent to J.I.C acquiring
such status as well as to the terms of the Creditors' Scheme.
4. EFFECTIVE DATE
4.1 This Scheme shall become effective and binding on the date on which all
of the following conditions are satisfied:
(a) of the Scheme Shareholders who are present and who vote in
person or by proxy at the Court Meeting, a majority in number
representing not less than 75 per cent of the value of the
Scheme Shares, vote in favour of this Scheme;
(b) an office copy of the Order is delivered to the Registrar of
Companies in Hong Kong for registration; and
(c) Clauses 4.1(a) and 4.1(b) of the Creditors' Scheme are
satisfied,
(the EFFECTIVE DATE).
4.2 Unless both this Scheme and the Creditors' Scheme become effective
within three months of the date on which the Notice of Shareholders'
Court Meeting being dispatched, or such later date, if any, as the Court
may allow, this Scheme shall lapse.
5. FURTHER ASSURANCES
5.1 The New Shares shall issued by J.I.C. free from all claims, charges,
liens, encumbrances and equities and shall rank pari passu in all
respects with the ordinary shares of J.I.C. then in issue.
5.2 In any case where the directors of J.I.C. have been advised that the
allotment and issue of the New Shares to a Scheme Shareholder may be
prohibited by any relevant law or may only be effected after compliance
with any conditions or requirements which the directors of J.I.C. regard
as unduly onerous by reason of cost, delay or otherwise, J.I.C. may
allot and issue the relevant New Shares to a person selected by the
directors of J.I.C. who shall sell the same and account to such Scheme
Shareholder for the net proceeds of sale (after deduction of all
commissions, duties, levies and other charges and expenses) in full
satisfaction of his rights to the New Shares to which, but for this
paragraph, he would have become entitled under this Scheme except that
no payment shall be made of any amount of less than HK$100, which amount
will be retained for the benefit of J.I.C.. J.I.C. shall be under no
obligation to convert the proceeds of sale into the currency of the
jurisdiction in which the registered address of the relevant holder of a
Scheme Share is situated.
5.3 J.I.C shall notify the Scheme Shareholders within 14 Business Days of
J.I.C. after making any allotment of New Shares pursuant to Clause 5.2.
5.4 Subject to Clause 5, J.I.C. shall allot and issue the New Shares
pursuant to Clause 3 of this Scheme on or within six (6) Business Days
from the Effective Date, or as soon as practical thereafter.
5.5 All net proceeds of sale payable by J.I.C. to a Scheme Shareholder in
accordance with Clause 5.2 shall be made by cheque drawn on a licensed
bank in Hong Kong, or if the amount of such proceeds has been converted
into a currency other than Hong Kong dollars, a bank carrying on
business in the country in which such currency is legal tender. Not
later than 28 Business Days after the Effective Date or as soon as
practical thereafter, J.I.C. shall deliver or procure to be delivered
(except to the extent it may be prohibited by law in any part of the
world from so doing) such cheques to the persons entitled thereto.
5.6 All cheques or certificates required to be delivered pursuant to the
terms of this Scheme shall be delivered (except to the extent to which
such delivery is prohibited by law in any part of the world) by sending
such cheques or
certificates through the post in pre-paid envelopes addressed to such
person within seven (7) Business Days from the date of issue of the
certificates in respect of the New Shares issued pursuant to Clause 5.9:
(a) in the case of a sole holder to the registered address of such
holder as appearing in the Register as at the Record Date; and
(b) in the case of joint holders to the registered address as
appearing in the Register as at the close of business on the
Record Date of the joint holder whose name then stands first in
the Register in respect of the relevant joint holding,
provided that the foregoing shall not preclude J.I.C. from delivering or
procuring to be delivered the cheques to such person or persons by a
method other than posting subject to the prior agreement of such person
or persons.
5.7 All cheques shall be made payable to the order of the person or persons
to whom in accordance with the foregoing provisions of this Clause 5 the
envelope containing the same is addressed and the encashment of any such
cheque shall be a good discharge to J.I.C. for the moneys represented
thereby.
5.8 Each instrument of transfer and certificate validly subsisting at the
Record Date in respect of a transfer or holding, respectively, of any
number of Scheme Shares shall upon the allotment and issue of the New
Shares pursuant to Clause 3 of this Scheme cease to be valid for any
purpose as an instrument of transfer or a certificate for Scheme Shares
and each valid instrument of transfer for Scheme Shares existing at the
Record Date shall instead be a valid instrument of transfer in respect
of the relevant number of New Shares.
5.9 J.I.C. shall issue and dispatch certificates for the appropriate number
of New Shares as set out in Clause 3.2 of this Scheme (subject to Clause
5.2 of this Scheme) at the expense of J.I.C. within six (6) Business
Days of the date of allotment and issue of the New Shares pursuant to
Clause 5.4 of this Scheme, or as soon as practical thereafter.
6. MISCELLANEOUS
6.1 All share certificates and cheques shall be delivered or posted at the
risk of the addressees and none of J.I.C., the person(s) nominated by
J.I.C., Albatronics or the Joint Liquidators shall be responsible for
any loss or delay in transmission.
6.2 All mandates or other instructions to Albatronics in force at the
opening of business on the date of allotment and issue of the New Shares
pursuant to Clause 3 of this Scheme relating to the Scheme Shares shall,
unless and until revoked or directed otherwise by a holder in writing,
be deemed as from the date of allotment and issue of the New Shares
pursuant to Clause 3 of this Scheme to be valid and subsisting mandates
or instructions to J.I.C. in relation to payment of dividends on and
corresponding matters relating to the relevant New Shares to be allotted
and issued pursuant to this Scheme.
6.3 Subject to Clause 5 of this Scheme, as from the date of allotment and
issue of the New Shares pursuant to Clause 3 of this Scheme, all
existing certificates representing holdings of Scheme Shares shall cease
to have effect as evidence of title and every holder thereof shall be
bound, on the request of J.I.C., to deliver up to Albatronics the
certificate(s) for existing holding(s) for cancellation or provide a
written statement that such certificates or documents have been lost or
destroyed.
7. COSTS AND DISBURSEMENTS
All costs, charges and expenses of and incidental to this Scheme and the
costs of carrying the same into effect shall be borne by Albatronics.
8. NOTICES
Every notice to be given to a Scheme Shareholder under this Scheme shall
be duly served if left or sent by pre-paid registered post to such
Scheme Shareholder at the address of such Scheme Shareholder as shown in
the Register at the Record Date.
9. AMENDMENTS
9.1 Minor amendments as to drafting and form may be made to this Scheme by
Albatronics after it has been approved by the Scheme Shareholders (but
before the sanction of the Court has been granted) without seeking the
approval of the Scheme Shareholders.
9.2 Albatronics, acting through the Joint Liquidators, and J.I.C may jointly
consent for and on behalf of all concerned to any immaterial
modification of or addition to this Scheme or to any condition which the
Court may see fit to approve or impose.
10. PROPER LAW
The proper law of this Scheme is the law of Hong Kong.
Dated this [____ ____] 2002.
SCHEDULE 3
FORM OF THE CREDITORS' SCHEME
Page 20
H.C.M.P. [ /02]
IN THE HIGH COURT OF
THE HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF FIRST INSTANCE
MISCELLANEOUS PROCEEDINGS
--------------------
IN THE MATTER
OF
ALBATRONICS (FAR EAST) COMPANY LIMITED
(IN LIQUIDATION)
AND
IN THE MATTER OF THE COMPANIES ORDINANCE (CHAPTER 32)
-------------------
SCHEME OF ARRANGEMENT
BETWEEN
ALBATRONICS (FAR EAST) COMPANY LIMITED
(IN LIQUIDATION)
AND
THE ADMITTED CREDITORS
(AS HEREINAFTER DEFINED)
-------------------
-------------------
THE SCHEME
-------------------
1. PRELIMINARY
1.1 In this Scheme, unless the context otherwise requires, words importing
the singular number shall include the plural and vice versa; persons
shall include bodies corporate and partnerships; and references to any
gender shall include all genders.
1.2 In this Scheme of Arrangement, unless inconsistent with the subject or
context, the following expressions shall bear the following meanings:
ACQUISITION the agreement dated [____] between Nam Tai (as
AGREEMENT defined below) and J.I.C. (as defined below) for
the acquisition of the entire issued share
capital of J.I.C. Group (BVI) Limited by J.I.C.
(as defined below).
ADMITTED the creditors of Albatronics (as defined below)
CREDITORS to the extent their claims have been admitted to
prove in the liquidation of Albatronics (as
defined below) at any time prior to the
Effective Date (as defined below);
ALBATRONICS Albatronics (Far East) Company Limited (in
liquidation) (Company Number 181207), a company
incorporated in Hong Kong with limited liability
and whose shares are listed on the main board of
the Stock Exchange and whose registered address
is 21st Floor, Edinburgh Tower, The Landmark, 15
Queen's Road Central, Hong Kong (as defined
below);
ALBATRONICS SHARES ordinary shares of HK$0.10 each in the existing
capital of Albatronics;
BUSINESS DAY a day upon which banks are open for business in
Hong Kong (other than a Saturday);
COMPANIES the Companies Ordinance (Chapter 32 of the Laws
ORDINANCE of Hong Kong (as defined below).
EFFECTIVE DATE has the meaning in Clause 4;
HONG KONG the Hong Kong Special Administrative Region of
the People's Republic of China;
J.I.C. J.I.C. Technology Company Limited, a company
incorporated in the Cayman Islands whose
registered
office is at Codan Trust Company (Cayman)
Limited, Century Yard, Cricket Square, Hutchins
Drive, PO Box 2681 GT, George Town, Grand
Cayman, Cayman Islands and whose Registration
Number is [____];
JOINT LIQUIDATORS Messrs. John James Toohey and David Chung Wai
Ng, of 21st Floor, Edinburgh Tower, The
Landmark, 15 Queen's Road Central, Hong Kong
having been appointed jointly and severally as
liquidators of Albatronics on 20 August 1999;
NAM TAI Nam Tai Electronics, Inc., a company
incorporated in the British Virgin Islands,
whose registered office is at 2nd Floor, 116
Main Street, Road Town, Tortola, British Virgin
Islands and with Registration Number 3805;
NEW SHARES new ordinary shares of J.I.C. of HK$0.01 each;
NOTICE OF ADMITTED the notice of the meeting of the Admitted
CREDITORS' COURT Creditors convened at the direction of the Court
MEETING in relation to the approval of this Scheme;
ORDER the order of the Court sanctioning this Scheme
(as defined below) pursuant to s.166 of the
Companies Ordinance;
PREFERENCE SHARES the Preference Shares of J.I.C. as defined in
the Restructuring Agreement (as defined below);
REGISTER the register of the members of Albatronics;
RESTRUCTURING the agreement dated [____] January 2002 entered
AGREEMENT into between Albatronics, Nam Tai, J.I.C. and
the Joint Liquidators;
SCHEME this scheme of arrangement in its present form
or with or subject to any modification thereof
or addition thereto or condition approved or
imposed by the Court and approved by Albatronics
and Nam Tai as provided herein.
SHAREHOLDERS' the scheme of arrangement pursuant to section
SCHEME 166 of the Companies Ordinance to be entered
into between Albatronics and the shareholders of
Albatronics, which upon its implementation and
the implementation of this Scheme will result in
the shareholders of Albatronics receiving 1 New
Share for every 90
Albatronics Shares in consideration of the
transfer of the Albatronics Shares to J.I.C.;
STOCK EXCHANGE the Stock Exchange of Hong Kong Limited; and
HK$ Hong Kong dollars
2. BACKGROUND
2.1 The Joint Liquidators were appointed as joint and several liquidators to
Albatronics by virtue of a special resolution passed at an extraordinary
general meeting of the members of Albatronics duly convened and held on
20 August 1999 and confirmed at a meeting of the creditors of
Albatronics held on the same date. At that members' meeting, a special
resolution was passed to wind up Albatronics voluntarily pursuant to
section 228(1) of the Companies Ordinance and the Joint Liquidators were
appointed as the joint and several liquidators of the Company.
2.2 The authorized share capital of Albatronics as at the commencement of
its winding-up on 20 August 1999 was HK$100,000,000 divided into
1,000,000,000 shares of HK$0.10 each of which 400,002,000 Albatronics
Shares had been issued and were full paid or credited as fully paid.
2.3 Pursuant to the Restructuring Agreement, it was agreed that, inter alia
and subject to certain conditions, (i) the shareholders of Albatronics
will become shareholders of J.I.C. in accordance with the proposal to
effect, through the Shareholders' Scheme, a listing of the New Shares on
the Stock Exchange, and (ii) the Admitted Creditors of Albatronics (or
their respective nominee(s)) will become shareholders of J.I.C. in
accordance with this Scheme.
2.4 Nam Tai will, on or prior to the Effective Date, pay to the Joint
Liquidators a sum of HK$4,100,000 pursuant to a preliminary agreement
dated 15 November 2001 entered into, inter alia, by Nam Tai (PRELIMINARY
AGREEMENT) for the purpose, inter alia, of covering certain costs,
charges and expenses of, or incidental to, this Scheme incurred by
Albatronics.
2.5 Nam Tai will conditionally sell the entire share capital of J.I.C. Group
(BVI) Limited to J.I.C. pursuant to the Acquisition Agreement in
consideration of 130,000,000 New Shares and 598,420,000 Preference
Shares credited as fully paid to Nam Tai or its nominee(s).
2.6 Conditional upon, inter alia, this Scheme and the Shareholders' Scheme
becoming effective, J.I.C. shall issue and allot an aggregate amount of
48,100,000 New Shares (representing approximately 26.35% of the issued
ordinary share capital of J.I.C. as enlarged by the issue of New Shares
pursuant to the Restructuring Agreement), credited as fully paid, to the
Admitted Creditors and/or their nominee(s) and Nam Tai according to this
Scheme.
2.7 The primary purpose of this Scheme is for the Admitted Creditors to
receive the New Shares to be issued as mentioned above, which would not
otherwise be received by Admitted Creditors through the liquidation of
Albatronics.
2.8 J.I.C. has agreed to appear by Counsel at the hearing of the Petition to
sanction this Scheme and to undertake to the Court to be bound thereby
and to execute and do or procure to be executed and done all such
documents, acts and things as may be necessary or desirable to be
executed or done by it for the purpose of giving effect to this Scheme
3. THE ARRANGEMENT
3.1 Subject to Clause 5 below, J.I.C. shall allot 48,100,000 New Shares
credited as fully paid to, or for the benefit of, the Admitted Creditors
on or within six (6) Business Days from the Effective Date, or as soon
as practical thereafter, of which:
(a) 44,000,000 New Shares shall be issued to the Admitted Creditors
and/or their nominee(s) (in proportion to the amount of their
admitted claims in the liquidation as the Joint Liquidators may
direct), which shares the Admitted Creditors shall accept; and
(b) 4,100,000 New Shares shall be issued, on behalf of the Admitted
Creditors, to Nam Tai or its nominee, which shares Nam Tai shall
accept as full and final settlement of the sum of HK$4,100,000
which will have been paid by Nam Tai to the Joint Liquidators
pursuant to the Preliminary Agreement on or prior to the
Effective Date.
(together, the SHARE ALLOTMENT).
Fractions of a New Share will not be issued and all fractional
entitlements will be aggregated and held for the benefit of J.I.C.
3.2 In consideration of the benefits set out in Clause 3.1, on the Effective
Date the Admitted Creditors agree that:
(a) insofar as they may have an interest in the listed status of
Albatronics, they consent to J.I.C. acquiring such status as
well as to the terms of the Shareholders' Scheme; and
(b) insofar as they may have an interest in the New Shares to be
issued to Nam Tai pursuant to Clause 3.1(b), they consent to
such issue; and
(c) to accept the benefits under this Scheme as full and final
discharge of their right to consent to any other scheme of
arrangement which would assist a company to obtain the listing
status of Albatronics.
4. THE EFFECTIVE DATE
4.1 This Scheme shall become effective and binding on the date on which all
the following conditions are satisfied:
(a) of the Admitted Creditors who are present and who vote in person
or by proxy at the Court Meeting a majority in number
representing not less than 75 per cent in value vote in favour
of the Scheme;
(b) an office copy of the Order is delivered to the Registrar of
Companies in Hong Kong for registration; and
(c) Clauses 4.1(a) and 4.1(b) of the Shareholders' Scheme are
satisfied,
(the EFFECTIVE DATE).
4.2 Unless both this Scheme and the Shareholders' Scheme become effective
within [three months of the date on which the Notice of Creditors' Court
Meeting being despatched], or such later date, if any, as the Court may
allow, this Scheme shall lapse.
5. FURTHER ASSURANCES
5.1 The New Shares shall be issued by J.I.C. free from all claims, charges,
liens, encumbrances and equities and shall rank pari passu in all
respects with the ordinary shares of J.I.C. then in issue.
5.2 Subject to Clause 5.3, J.I.C. shall issue and dispatch certificates for
the appropriate number of New Shares at the expense of J.I.C. within six
(6) Business Days of the date of allotment and issue of the New Shares,
or as soon as practical thereafter, pursuant to Clause 3 of this Scheme.
5.3 In any case where the Joint Liquidators have been advised that the
allotment and issue or distribution of the New Shares to an Admitted
Creditor may be prohibited by any relevant law or may only be effected
after compliance with any conditions or requirements which the Joint
Liquidators regard as unduly onerous by reason of cost, delay or
otherwise, J.I.C. may allot and issue the relevant New Shares to a
person selected by the Joint Liquidators, who shall sell the same and
account to such Admitted Creditor for the net proceeds of sale (after
deduction of all commissions, duties, levies and other charges and
expenses) in full satisfaction of his rights to the New Shares to which,
but for this paragraph, he would have become entitled except that no
payment shall be made of any amount of less than HK$100, which amount
will be retained for the benefit of JIC. J.I.C. shall be under no
obligation to convert the proceeds of sale into the currency of the
jurisdiction in which the registered address of the relevant Admitted
Creditor is situated.
5.4. J.I.C. shall notify the Admitted Creditors within 14 Business Days after
J.I.C. making any allotment of New Shares pursuant to Clause 5.3.
5.5 All net proceeds of sale payable by J.I.C. to an Admitted Creditor in
accordance with Clause 5.3 shall be made by cheque drawn on a licensed
bank in Hong Kong, or if the amount of such proceeds has been converted
into a currency other than Hong Kong dollars, a bank carrying on
business in the country in which such currency is legal tender. Not
later than 28 Business Days after the Effective Date or as soon as
practical thereafter, J.I.C. shall deliver or procure to be delivered
(except to the extent it may be prohibited by law in any part of the
world from so doing) such cheques to the persons entitled thereto.
5.6 All cheques or certificates required to be delivered pursuant to the
terms of this Scheme shall be delivered (except to the extent to which
such delivery is prohibited by law in any part of the world) by sending
such cheques or certificates through the post in pre-paid envelopes
addressed to such person within seven (7) Business Days from the date of
issue of the certificates in respect of the New Shares issued pursuant
to Clause 5.2:
(a) in the case of a sole holder to the registered address of such
holder as appearing in the Register as at the Record Date; and
(b) in the case of joint holders to the registered address as
appearing in the Register as at the close of business on the
Record Date of the joint holder whose name then stands first in
the Register in respect of the relevant joint holding,
provided that the foregoing shall not preclude J.I.C. from delivering or
procuring to be delivered the cheques to such person or persons by a
method other than posting subject to the prior agreement of such person
or persons.
5.7 All cheques shall be made payable to the order of the person or persons
to whom in accordance with the foregoing provisions of this Clause 5 the
envelope containing the same is addressed and the encashment of any such
cheque shall be a good discharge to J.I.C. for the moneys represented
thereby.
6. MISCELLANEOUS
6.1. All share certificates relating to the Share Allotment shall be
delivered or posted at the risk of the addressees (and to their latest
address known to the Joint Liquidators) and none of J.I.C., Albatronics
or the Joint Liquidators shall be responsible for any loss or delay in
transmission.
7. COSTS AND DISBURSEMENTS
All costs, charges and expenses of and incidental to this Scheme and the
costs of carrying the same into effect shall be borne by Albatronics.
8. NOTICES
Every notice to be given to an Admitted Creditor under this Scheme shall
be duly served if left or sent by pre-paid registered post to such
Admitted
Creditor at the address of such Admitted Creditor advised by it in
advance in writing to the Joint Liquidators.
9. AMENDMENTS
9.1 Minor amendments as to drafting and form may be made to this Scheme by
Albatronics after it has been approved by the Admitted Creditors (but
before the sanction of the Court has been granted) without seeking the
approval of the Admitted Creditors.
9.2 Albatronics, acting through the Joint Liquidators, and J.I.C. may
jointly consent for and on behalf of all concerned to any immaterial
modification of or addition to this Scheme or to any condition which the
Court may see fit to approve or impose.
10. PROPER LAW
The proper law of this Scheme is the law of Hong Kong.
Dated this [_______] 2002.
SCHEDULE 4
PRINCIPAL RIGHTS AND BENEFITS OF PREFERENCE SHARES
1. As to income The Preference Shares rank pari passu with
Shares on the payment of any dividend or
other distribution (other than a distribution
on winding up).
2. As to capital On a winding up, the holders of the Preference
Shares shall be entitled to receive HK$0.01 per
Preference Share in priority to Shares, and
otherwise shall rank pari passu with Shares on a
return of capital.
3. As to conversion Subject to approval by the board of the Company,
holders of the Preference Shares may convert all or
such number of the Preference Shares into Shares at
the initial conversion ratio of 1.03 Preference
Shares for each Share, subject adjustments normally
applicable to convertible securities. No
fractional Shares will be issued.
The Investor shall undertake not to convert
any part of the Preference Shares into Shares
if such conversion would reduce the public
float to less than 25 per cent.
4. As to redemption The Preference Shares are perpetual securities
without any redemption feature.
5. As to voting Holders of the Preference Shares will not be
entitled to vote at general meetings of the Company.
6. As to transferability Subject to the approval of the board of the
Company, the Preference Shares will be freely
transferable.
7. Rights attached to Shares allotted and issued pursuant to the exercise
the conversion shares by a holder of the Preference Shares of the
conversion rights attaching to the Preference
Shares shall rank pari passu in all respects
with the Shares as at the date of allotment.
Page 21
SCHEDULE 5
FORM OF NOTICE OF SHAREHOLDERS' COURT MEETING
Page 22
H.C.M.P. [ /02]
IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF FIRST INSTANCE
MISCELLANEOUS PROCEEDINGS
2002: NO. [o]
--------------------
IN THE MATTER
OF
ALBATRONICS (FAR EAST) COMPANY LIMITED
(IN LIQUIDATION)
AND
IN THE MATTER OF THE COMPANIES ORDINANCE (CHAPTER 32)
---------------------------
NOTICE OF COURT MEETING
OF THE SCHEME SHAREHOLDERS
---------------------------
NOTICE IS HEREBY GIVEN that, by an Order dated [____________] (the ORDER) made
in the above matter, the High Court of Hong Kong has directed a meeting (the
MEETING) to be convened of the Scheme Shareholders (as defined in the Scheme of
Arrangement hereinafter mentioned), for the purpose of considering and, if
thought fit, approving (with or without modification) a Scheme of Arrangement
proposed to be made between ALBATRONICS (FAR EAST) COMPANY LIMITED (ALBATRONICS)
and the Scheme Shareholders (as defined in such Scheme of Arrangement) and that
the Meeting will be held at [____] on [____ ____ ___], at [____ ____ ____], Hong
Kong at which time and place all the Scheme Shareholders (as defined as
aforesaid) are requested to attend.
A copy of the Scheme of Arrangement and a copy of an Explanatory Statement
required to be furnished pursuant to section 166A(1)(a) of the Companies
Ordinance are incorporated in the printed document of which this Notice forms
part and may
also be obtained at the offices of Arthur Andersen, 21st Floor, Edinburgh Tower,
The Landmark, 15 Queen's Road Central Hong Kong.
The Scheme Shareholders (as defined as aforesaid) may vote in person at the
Meeting or they may appoint another person, whether a member of Albatronics or
not, as their proxy to attend and vote in their stead. A blue form of proxy for
use at the Meeting is enclosed with the printed document of which this Notice
forms part.
In the case of joint Scheme Shareholders of a Scheme Share, the vote of the
senior who tenders a vote, whether in person or by proxy, will be accepted to
the exclusion of the vote(s) of the other joint holder(s), and for this purpose,
seniority will be determined by the order in which the names stand in the
register of members of Albatronics in respect of the relevant joint
shareholding.
It is requested that forms appointing proxies, completed in accordance with the
instructions thereon, be lodged at the office of the share registrar of
Albatronics in Hong Kong, [____] not less than 48 hours before the time
appointed for the Meeting, but if the forms are not so lodged they may be handed
to the Chairman of the Meeting at the Meeting.
Scheme Shareholders or proxies wishing to attend the Meeting should arrive in
sufficient time before the commencement of the Meeting in order to ensure
completion of registration forms.
By the said Order, the Court has appointed Mr. John James Toohey or failing him,
Mr. David Chung Wai Ng to act as Chairman of the Meeting and has directed the
Chairman to report the result thereof to the Court.
The Scheme of Arrangement will be subject to the subsequent approval of the High
Court of Hong Kong.
Dated: _____ _____, 2002
Page 22
SCHEDULE 6
FORM OF NOTICE OF CREDITORS' COURT MEETING
Page 23
H.C.M.P. [ /02]
IN THE HIGH COURT OF
THE HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF FIRST INSTANCE
MISCELLANEOUS PROCEEDINGS
--------------------
IN THE MATTER
OF
ALBATRONICS (FAR EAST) COMPANY LIMITED
(IN LIQUIDATION)
AND
IN THE MATTER OF THE COMPANIES ORDINANCE (CHAPTER 32)
---------------------------
NOTICE OF COURT MEETING
OF SCHEME CREDITORS
---------------------------
NOTICE IS HEREBY GIVEN that, by an Order dated [____ ____] (the ORDER) made in
the above matter, the High Court of Hong Kong has directed a meeting (the
MEETING) to be convened of the Admitted Creditors (as defined in the Scheme of
Arrangement hereinafter mentioned), for the purpose of considering and, if
thought fit, approving (with or without modification) a Scheme of Arrangement
proposed to be made between ALBATRONICS (FAR EAST) COMPANY LIMITED (ALBATRONICS)
and the Admitted Creditors (as defined in such Scheme of Arrangement) and that
the Meeting will be held at [____ ____ ____ ____] 2002, at [____ ____ ____],
Hong Kong at which time and place all the Admitted Creditors (as defined as
aforesaid) are requested to attend.
A copy of the Scheme of Arrangement and a copy of an Explanatory Statement
required to be furnished pursuant to section [____] of the Companies Ordinance
are incorporated in the printed document of which this Notice forms part and may
also be obtained at the offices of Arthur Andersen, 21st Floor, Edinburgh Tower,
the Landmark, 15 Queen's Road Central, Hong Kong.
The Admitted Creditors (as defined as aforesaid) may vote in person at the
Meeting or they may appoint another person, whether a creditor of Albatronics or
not, as their
proxy to attend and vote in their stead. A green form of proxy for use at the
Meeting is enclosed with the printed document of which this Notice forms part.
It is requested that forms appointing proxies, completed in accordance with the
instructions thereon, be lodged at the office of Arthur Andersen, 21st Floor,
Edinburgh Tower, the Landmark, 15 Queen's Road Central, Hong Kong not less than
48 hours before the time appointed for the said Meeting, but if forms are not so
lodged they may be handed to the Chairman of the Meeting at the Meeting.
Creditors or proxies wishing to attend the Meeting should arrive in sufficient
time before the commencement of the Meeting in order to ensure completion of
registration forms.
By the same Order the Court has appointed Mr. John James Toohey or, failing him,
Mr David Chung Wai Ng to act as Chairman of the Meeting and has directed the
Chairman to report the result thereof to the Court.
The Scheme of Arrangement will be subject to the subsequent approval of the High
Court of Hong Kong.
Dated: [____ ____] 2002
Page 22
SCHEDULE 7
COMPOSITION OF THE COMMITTEE OF INSPECTION
Page 24
DETAILS OF THE MEMBERS OF THE COMMITTEE OF INSPECTION AND
THEIR RESPECTIVE APPROXIMATE PERCENTAGE OF PROVING CREDITORS
- ------------------------------------------------- ----------------------- ----------------------
NAME OF COMMITTEE OF INSPECTION MEMBER AMOUNT OF ADMITTED PERCENTAGE TO TOTAL
CLAIM (HK$) ADMITTED CLAIMS
- ------------------------------------------------- ----------------------- ----------------------
Sony Corporation of Hong Kong Limited 92,950,251.63 21.3%
- ------------------------------------------------- ----------------------- ----------------------
Sumitomo Mitsui Banking Corporation 102,985,276.54 23.6%
- ------------------------------------------------- ----------------------- ----------------------
The Bank of Tokyo-Mitsubishi Limited 94,361,113.29 21.6%
- ------------------------------------------------- ----------------------- ----------------------
The Sanwa Bank Limited 78,142,295.09 17.9%
- ------------------------------------------------- ----------------------- ----------------------
Sub-total 368,438,936.55 84.4%
- ------------------------------------------------- ----------------------- ----------------------
Total Amount of Admitted Claim as at 436,212,168.80 100.0%
14 November 2001
- ------------------------------------------------- ----------------------- ----------------------
CONTENTS
CLAUSE PAGE
DEFINITIONS AND INTERPRETATION.....................................................2
THE PROPOSALS......................................................................6
Shareholders' Scheme..........................................................6
Creditors' Scheme.............................................................6
Acquisition...................................................................7
CONDITIONS PRECEDENT...............................................................8
COMPLETION.........................................................................9
REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS BY INVESTOR AND THE COMPANY..........10
REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS BY ALBATRONICS.......................11
TERMINATION.......................................................................11
THE INVESTOR AND THE COMPANY'S COSTS AND EXPENSES.................................12
OVERSEAS SHAREHOLDERS AND OVERSEAS ADMITTED CREDITORS.............................12
FRACTIONAL ENTITLEMENTS...........................................................13
STAMP DUTY........................................................................13
ARRANGEMENTS FOR ODD LOT TRADING..................................................13
NOTICES...........................................................................13
RIGHTS AND REMEDIES...............................................................15
MISCELLANEOUS.....................................................................15
Time of the essence..........................................................15
Invalidity...................................................................15
Severability.................................................................15
Entire Agreement.............................................................15
Counterparts.................................................................16
Assignment...................................................................16
Announcements................................................................16
Variation....................................................................16
JOINT LIQUIDATORS' LIABILITY......................................................16
GOVERNING LAW AND JURISDICTION....................................................16
Page I
SCHEDULE 1........................................................................19
FORM OF DRAFT ACQUISITION AGREEMENT...............................................19
SCHEDULE 2........................................................................20
FORM OF SHAREHOLDERS' SCHEME......................................................20
SCHEDULE 3........................................................................20
FORM OF THE CREDITORS' SCHEME.....................................................20
SCHEDULE 4........................................................................21
PRINCIPAL RIGHTS AND BENEFITS OF PREFERENCE SHARES................................21
SCHEDULE 5........................................................................22
FORM OF NOTICE OF SHAREHOLDERS' COURT MEETING.....................................22
SCHEDULE 6........................................................................23
FORM OF NOTICE OF CREDITORS' COURT MEETING........................................23
SCHEDULE 7........................................................................24
COMPOSITION OF THE COMMITTEE OF INSPECTION........................................24
Page II
14 JANUARY 2002
NAM TAI ELECTRONICS, INC.
J.I.C. TECHNOLOGY COMPANY LIMITED
ALBATRONICS (FAR EAST) COMPANY LIMITED
(IN LIQUIDATION)
MESSRS JOHN JAMES TOOHEY and DAVID CHUNG WAI NG AS JOINT AND
SEVERAL LIQUIDATORS OF ALBATRONICS (FAR EAST) COMPANY LIMITED
============================================
RESTRUCTURING AGREEMENT
============================================
[LOGO] FRESHFIELDS BRUCKHAUS DERINGER
Draft (5): 14th January, 2002
PRIVATE & CONFIDENTIAL
DATED [o]
NAM TAI ELECTRONICS, INC.
AND
J.I.C. TECHNOLOGY COMPANY LIMITED
-------------------------------------------
AGREEMENT
RELATING TO THE SALE AND PURCHASE
OF THE ENTIRE ISSUED SHARE CAPITAL OF
J.I.C. GROUP (B.V.I.) LIMITED
-------------------------------------------
[JOHNSON STOKES & MASTER LOGO]
(JMM/JALB/DSTC/5987602)
CONTENTS
AGREEMENT
PAGE
CLAUSE HEADING
1. Definitions and Interpretation
2. Sale and Purchase
3. Consideration
4. Condition Precedent
5. Completion
6. Warranties
7. Further Assurance
8. Miscellaneous
9. Notices
10. Costs and Expenses
11. Time
12. Governing Law
13. Process Agent
SCHEDULE
NUMBER DESCRIPTION PAGE
1 Target Group Organisational Chart
2 Basic Information Concerning the Subsidiaries
3 The Warranties
4 Rights attached to the Preference Shares
EXECUTION
-1-
THIS AGREEMENT is dated 2002 and is made
BETWEEN:
(1) NAM TAI ELECTRONICS, INC., a company incorporated in the British Virgin
Islands, with registration No. 3805 (the "SELLER"); and
(2) J.I.C. TECHNOLOGY COMPANY LIMITED, a company incorporated in the Cayman
Islands whose registered office is at Codan Trust Company (Cayman)
Limited, Century Yard, Cricket Square, Hutchins Drive, P.O. Box 2681GT,
George Town, Grand Cayman, Cayman Islands (the "PURCHASER").
BY WHICH IT IS AGREED as follows:-
1. DEFINITIONS AND INTERPRETATION
1.1 In this Agreement, unless the context requires otherwise:-
"AUDITED ACCOUNTS" means the audited consolidated financial statements
of the Company and its subsidiaries in respect of the last financial
year of the Company ended on 31st December, 2001;
"BUSINESS DAY" means a day (excluding Saturdays and Sundays) on which
banks in Hong Kong are open for business;
"COMPANIES ORDINANCE" means the Companies Ordinance (Chapter 32, as
amended, of the Laws of Hong Kong);
"COMPANY" means J.I.C. Group (B.V.I.) Limited, a wholly owned subsidiary
of the Seller;
"COMPLETION" means completion of the sale and purchase of the Sale
Shares and, where the context requires, the performance by the parties
of the several obligations contained in Clause 5;
"CONSIDERATION SHARES" means 130,000,000 Ordinary Shares and 598,420,000
Preference Shares representing about 17.03% and 76.09% respectively of
the enlarged Ordinary Share capital of the Purchaser upon completion of
the Restructuring Agreement and upon conversion in full of the
Preference Shares to Ordinary Shares at the Initial Conversion Rate to
be allotted and issued pursuant to Clause 3 of this Agreement;
"HK$" means Hong Kong dollars;
"HKSE" means The Stock Exchange of Hong Kong Limited
"HONG KONG" means Hong Kong Special Administrative Region of the PRC;
-2-
"INITIAL CONVERSION RATE" means the conversion rate of 1.03 Preference
Shares to 1 Ordinary Share;
"LISTING COMMITTEE" means the listing sub-committee of the board of
directors of HKSE;
"LISTING RULES" means the Rules Governing the Listing of Securities on
HKSE as amended from time to time;
"ORDINARY SHARES" means ordinary shares with par value of HK$0.01 each
in the share capital of the Purchaser;
"PARTIES" means the Seller and the Purchaser and "PARTY" means any one
of them;
"PRC" means the People's Republic of China, and for the purposes of this
Agreement, excluding Hong Kong, Macau Special Administrative Region of
the PRC and Taiwan;
"PREFERENCE SHARES" means non-voting convertible preference shares of
HK$0.01 each in the capital of the Purchaser with the rights set out in
Schedule 4;
"RESTRUCTURING AGREEMENT" means the agreement dated [ ] entered
into between, inter alia, the Seller and the Purchaser for the purpose
of implementing the proposals set out in the said agreement;
"SALE SHARES" means the entire issued share capital of the Company
"SUBSIDIARIES" means, for the purposes of this Agreement, each of the
companies and other corporations and bodies corporate shown in the
organisational chart set out in Schedule 1 (with the exception of the
Company), further details of which are set out in Schedule 2;
"TARGET GROUP" means the Company together with the Subsidiaries and
references to "TARGET GROUP Company" and to any "MEMBER OF THE TARGET
GROUP" shall be construed accordingly;
"WARRANTIES" means the warranties and undertakings set out in Schedule
3;
(a) words and expressions defined in the Companies Ordinance shall
bear the same respective meanings when used herein;
(b) reference to any statute or statutory provision shall include
any statute or statutory provision which amends or replaces, or
has amended or replaced, it and shall include any subordinate
legislation made under the relevant statute or statutory
provision;
(c) a body corporate shall be deemed to be associated with another
body corporate if it is a holding company or a subsidiary of
that other body corporate or a subsidiary of a holding company
of that body corporate;
-3-
(d) references to Clauses, Sub-clauses, Schedules and Exhibits are
to Clauses and Sub-clauses of and Schedules and Exhibits to this
Agreement;
(e) references to writing shall include typewriting, printing,
lithography, photography, telefax and telex messages and other
modes of reproducing words in a legible and non-transitory form;
and
(f) words importing the singular include the plural and vice versa,
words importing a gender include every gender and references to
persons include bodies corporate or unincorporate.
1.2 Headings are for convenience only and shall not affect the construction
of this Agreement.
1.3 In construing this Agreement:-
(i) the rule known as the ejusdem generis rule shall not apply and
accordingly general words introduced by the word "other" shall
not be given a restrictive meaning by reason of the fact that
they are preceded by words indicating a particular class of
acts, matters or things and a particular class of acts, matters
or things; and
(ii) general words shall not be given a restrictive meaning by reason
of the fact that they are followed by particular examples
intended to be embraced by the general words.
1.4 The Schedules form part of this Agreement and shall have the same force
and effect as if expressly set out in the body of this Agreement and any
reference to this Agreement shall include the Schedules.
2. SALE AND PURCHASE
Subject to the terms and conditions of this Agreement, the Seller as
legal and beneficial owner shall sell and the Purchaser relying on the
Warranties shall purchase with effect from Completion the Sale Shares
free from all liens charges encumbrances equities and adverse interests
and with all rights now attached thereto including the right to receive
all dividends and other distributions declared, made or paid on or after
Completion.
3. CONSIDERATION
3.1 The consideration for the sale of the Sale Shares shall be the
Consideration Shares to be allotted and issued to the Seller or as it
may direct, credited as fully paid.
3.2 The Ordinary Shares allotted to the Seller shall rank pari passu in all
respects with the Ordinary Shares of the Purchaser in issue at
Completion, and shall carry the right to receive in full all dividends
and other distributions declared, made or paid after Completion.
4. CONDITION PRECEDENT
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4.1 Completion shall be conditional upon the Restructuring Agreement
becoming unconditional (other than condition 3.1(a) of the Restructuring
Agreement).
4.2 If the Condition in Clause 4.1 is not fulfilled by 30th June, 2002 (or
such later date as the Parties may agree), this Agreement (other than
Clauses 10, 12 and 13) shall cease to have effect and none of the
parties shall have any obligation to each other, save arising from any
antecedent breach of this Agreement.
5. COMPLETION
5.1 Subject to the Condition in Clause 4.1 being completed (or waived by the
Parties), completion shall take at [the office of Messrs. Johnson Stokes
& Master] when all (but not part only) of the following business shall
be transacted:-
(a) the Seller shall deliver to the Purchaser or procure the
delivery to the Purchaser of:-
(i) duly executed share transfer instruments (in a form
complying with all applicable laws) in respect of the
Sale Shares in favour of the Purchaser and/or its
nominees together with the relative certificates
therefor;
(ii) such other documents as may be required to give good
title to the Sale Shares or which may be necessary to
enable the Purchaser or its nominees to procure the
registration of the same in the name of the Purchaser or
its nominees; and
(iii) evidence of the due authority of any person signing any
instrument or document on behalf of the Seller.
(b) the Seller shall procure a duly convened and held meeting of the
board of directors of the Company [and of each other member of
the Target Group] is held at which resolutions shall be passed
(where appropriate):-
(i) to approve this Agreement and give effect to all of the
transactions contemplated hereunder;
(ii) to approve (subject to stamping, where necessary) the
Purchaser and its nominees for registration as the
holders of the Sale Shares; and
(iii) to deal with and resolve upon such other matters as the
Purchaser shall reasonably require for the purposes of
giving effect to the provisions of this Agreement.
(c) at a duly convened and held meeting of the board of directors of
the Purchaser the Consideration Shares shall be allotted to the
Seller or such persons as it shall direct, credited as fully
paid up.
5.2 As soon as practicable following Completion, the Purchaser shall deliver
to the Seller share certificate(s) in respect of the Consideration
Shares together with a copy of the
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resolutions of the board of directors of the Purchaser authorising the
allotment and issue of the Consideration Shares.
5.3 No Party shall be obliged to complete this Agreement or perform any
obligations hereunder unless the other parties comply fully with the
requirements of Clause 5.1.
6. WARRANTIES
6.1 The Seller represents, warrants and undertakes to and with the Purchaser
in the terms set out in Schedule 3.
6.2 The Seller accepts that the Purchaser is entering into this Agreement in
reliance upon each of the Warranties notwithstanding any investigations
which the Purchaser, its agents or advisors may have made and undertakes
to indemnify the Purchaser against any costs (including all legal costs
on a solicitor and own client basis), expenses or other liabilities
which it may incur in connection with:-
(i) the settlement of any claim that any of the Warranties are
untrue or misleading or have been breached;
(ii) any legal proceedings in which the Purchaser claims that any of
the Warranties are untrue or misleading or have been breached
and in which judgment is given for the Purchaser; or
(iii) the enforcement of any such settlement or judgment.
6.3 Each of the Warranties shall be construed as a separate Warranty and
(save as expressly provided to the contrary) shall not be limited or
restricted by reference to or inference from the terms of any other
Warranty or any other terms of this Agreement.
6.4 Any rights to which the Purchaser may be or become entitled by reason of
any of the Warranties and all remedies which may be available to the
Purchaser in consequence of any of the Warranties being untrue or
misleading or breached shall enure for the benefit of any holding
company of the Purchaser or any subsidiary of any such holding company
which is the beneficial owner for the time being of the Sale Shares and
accordingly any loss which is sustained by such beneficial owner for the
time being of the Sale Shares in consequence of any of the Warranties
being untrue misleading or breached shall be deemed to be that of the
Purchaser and the Purchaser may bring proceedings and exercise any other
remedy on the footing that he has been the beneficial owner of the Sale
Shares at all times from Completion.
6.5 No claim shall be brought by the Purchaser under any of the Warranties
unless notice of such claim specifying in reasonable detail the event or
default to which the claim relates and the nature of the breach and
amount claimed has been received by the Seller not later than the expiry
of the period of 1 year following Completion. Any claim in respect of
which such notice shall have been given shall be deemed to have been
irrevocably withdrawn and lapsed if (not having been previously
satisfied settled or withdrawn) proceedings in respect of such claim
have not been issued and served on the Seller not later than the expiry
of the period of 6 months after the date of such notice.
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6.6 The Seller shall only be liable in respect of any one claim under the
Warranties if:
(a) the amount finally adjudicated or agreed as being payable in
respect of such individual claim is in excess of HK$50,000; and
(b) the aggregate amount finally adjudicated or agreed as being
payable in respect of all such claims referred to in Clause 6.6
(a) above is in excess of HK$500,000 in which event, the Seller
shall be liable for the whole amount and not merely for the
excess.
6.7 The total liability of the Seller for claims made under the Warranties
shall not exceed the audited consolidated net tangible assets of the
Target Group as shown in the Audited Accounts.
6.8 The Seller shall not be liable under the Warranties to the extent that
any depletion, diminution or reduction in the value or amount of any of
the assets of the Company or any of the Subsidiaries occurs as a result
of or is otherwise attributable to any legislation not in force at the
date of this Agreement or any change of law or administrative practice
which take effect retroactively or occurs as a result of any increase in
the rates of Taxation in force at the date of this Agreement
6.9 Each of the Parties represents and warrants to the other Party that (i)
it has the full power to enter into this Agreement and to exercise its
rights and perform its obligations hereunder; (ii) all corporate and
other actions required to authorise its entering into and execution of
this Agreement and its performance of its obligations hereunder have
been duly taken; and (iii) this Agreement will, when executed, be a
legal, valid and binding agreement on the Party who executed it and
enforceable in accordance with the terms thereof.
6.10 The Warranties given by the Seller herein shall be deemed to be repeated
immediately prior its Completion as if given or made at such time, with
reference to each case to the facts and circumstances then subsisting.
The Seller hereby undertakes that it will from time to time and at any
time, whether before or after Completion, forthwith disclose in writing
to the Purchaser any event, fact or circumstance which may become known
to it after the date hereof and which is materially inconsistent with
any of the Warranties or which could reasonably be expected to
materially affect a purchaser for value of the Sale Shares or which may
entitle the Purchaser to make any claim under this Agreement. Any such
disclosure shall make specific reference to this Clause 6.10 and shall
contain such information as is reasonably required to identify the
amount of the claim arising under this Agreement as a result thereof.
6.11 Prior to Completion, if the Seller has made any disclosure to the
Purchaser pursuant to Clause 6.10, then the Purchaser shall be entitled:
(a) to terminate this Agreement (save for Clauses 1, 6.11, 8 to 13
inclusive)); or
(b) to proceed to Completion (in which case it shall not be entitled
to make recovery against the Seller in respect of such disclosed
matter).
If this Agreement is terminated prior to Completion as aforesaid,
neither party shall
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have any claim against the other except for any rights and liabilities
of the parties which have accrued prior to such termination.
7. FURTHER ASSURANCE
Each of the Parties undertakes to the other Party that it will do all
such acts and things and execute all such deeds and documents as may be
necessary or desirable to carry into effect or to give legal effect to
the provisions of this Agreement and the transactions hereby
contemplated.
8. MISCELLANEOUS
8.1 Any provision of this Agreement which is capable of being performed
after but which has not been performed at or before Completion shall
remain in full force and effect notwithstanding Completion.
8.2 This Agreement shall be binding on and enure for the benefit of the
successors of each of the parties but subject to Clause 6.4, shall not
be assignable.
8.3 Any remedy conferred on any Party for breach of this Agreement
(including the breach of any Warranty) shall be in addition and without
prejudice to all other rights and remedies available to it and the
exercise of or failure to exercise any remedy shall not constitute a
waiver by such Party of any of its rights or remedies.
8.4 This Agreement constitutes the whole agreement between the Parties
relating to the sale and purchase of the Sale Shares (no Party having
relied on any representation made by the other Party which is not a term
of this Agreement) and no future variation shall be effective unless
made in writing and signed by each of the parties. This clause shall not
extend to any fraudulent representation or warranty.
8.5 This Agreement shall supersede all and any previous agreements or
arrangements between the parties hereto or any of them relating to the
Company or to any other matter referred to in this Agreement and all or
any such previous agreements or arrangements (if any) shall cease and
determine with effect from the date hereof.
8.6 If at any time any provision of this Agreement is or becomes illegal,
invalid or unenforceable in any respect, the remaining provisions hereof
shall in no way be affected or impaired thereby.
8.7 This Agreement may be executed in any number of counterparts and by
different parties on separate counterparts, each of which is an original
but, together, they constitute one and the same agreement.
9. NOTICES
9.1 In Writing and Methods of Delivery
Every notice or communication under this Agreement must be in writing
and may, without prejudice to any other form of delivery, be delivered
personally or sent by post or transmitted by fax.
-8-
9.2 Authorised Addresses and Numbers
(a) In the case of posting, the envelope containing the notice or
communication must be addressed to the intended recipient at the
authorised address of that Party and must be properly stamped or
have the proper postage prepaid for delivery by the most
expeditious service available (which will be airmail if that
service is available) and, in the case of a fax or telex, the
transmission must be sent to the intended recipient at the
authorised number of that Party.
(b) Subject to Clause 9.3, the authorised address, fax and telex
numbers of each Party, for the purpose of Clause 9, are as
follows:-
Nam Tai Electronics Inc.
Address:
c/o Nam Tai Group Management Limited
15th Floor, China Merchants Tower
Shun Tak Centre
168-200 Connaught Road Central
Hong Kong
Fax: (852) 2263 1223
For the attention of Mr. Koo Ming Kown
J.I.C. Technology Company Limited
c/o Nam Tai Group Management Limited
15th Floor, China Merchants Tower
Shun Tak Centre
168-200 Connaught Road Central
Hong Kong
Fax: (852) 2263 1223
For the attention of Mr. Joseph Li
9.3 Notification of Changes
No change in any of the particulars set out in Clause 9.2(b) will be
effective against a Party until it has been notified to that Party.
9.4 Deemed Giving of Notice and Receipt
A notice or communication will be deemed to have been duly given and
received:-
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(a) on personal delivery to any director or the secretary of an
addressee or on a business day to a place for the receipt of
letters at that addressee's authorised address;
(b) in the case of posting, where the addressee's authorised address
is in the same country as the country of posting, at 10 a.m.
(local time at the place where the address is located) on the
second business day after the day of posting;
(c) in the case of posting, where the addressee's authorised address
is not in the same country as the country of posting, at 10 a.m.
(local time at the place where that address is located) on the
fifth business day after the day of posting;
(d) in the case of a fax, on issue to the sender of an O.K. result
confirmation report or, if the day of issue is not a business
day, at 10 a.m. (local time where the authorised fax number of
the intended recipient is located) on the next business day.
9.5 Business Days
For the purpose of Clause 9.4, a "BUSINESS DAY" means a day which is not
a Saturday or a Sunday or a public holiday in the country of posting or
transmission or in the country where the authorised address or fax
number of the intended recipient is located and, where a notice is
posted, which is not a day when there is a disruption of postal services
in either country which prevents collection or delivery.
10. COSTS AND EXPENSES
10.1 Each Party shall pay its own costs and expenses in relation to the
negotiations leading up to the sale and purchase of the Sale Shares and
to the preparation and execution and performance of this Agreement.
10.2 The Seller and the Purchaser shall pay all stamp duty or other transfer
taxes (if any) on the sale and purchase of the Sale Shares in equal
shares.
11. TIME
Time shall be of the essence of this Agreement.
12. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the
laws of Hong Kong and each Party irrevocably submits to the
non-exclusive jurisdiction of the courts of Hong Kong.
13. PROCESS AGENT
13.1 The service of any process connected with proceedings in the
Hong Kong courts and relating to this Agreement will be deemed
to have been validly served on the Seller if they are served on
the process agent whose name and
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present address are set out below and service will be deemed to
have been acknowledged by the Seller if it is acknowledged by
that process agent:-
[Johnson Stokes & Master
16th to 19th Floors Prince's Building
10 Chater Road
Hong Kong]
13.2 In the event that the appointment of the process agent as
mentioned in Clause 13.1 above ceases to be effective, the
Seller shall immediately appoint another person in Hong Kong to
accept service of process on their behalf in Hong Kong and to
deliver to the Purchaser a copy of a written acceptance of
appointment of such agent within seven (7) Business Days.
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SCHEDULE 1
Target Group Organisational Chart
[FLOW CHART]
-12-
SCHEDULE 2
BASIC INFORMATION CONCERNING THE SUBSIDIARIES(1)
J.I.C. ELECTRONICS COMPANY LIMITED
1. Registered Number : 483085
2. Former Name : Nil
3. Date of Incorporation : 23rd June 1994
4. Place of Incorporation : Hong Kong
5. Address of Registered Office: : 15th Floor, China Merchants Tower, Shun Tak Centre, Nos.
168-200 Connaught Road Central, Hong Kong
6. Authorised Share Capital : HK$10,000 divided into 10,000 shares of HK$1 each
7. Issued Share Capital : 10,000 shares registered as to 9,999 shares in the name of
J.I.C. Group (B.V.I.) Limited and as to 1 share in the name
of J.I.C. Enterprises (Hong Kong) Limited and beneficially
owned by J.I.C. Group (B.V.I.) Limited
8. Directors : Mr. Li Shi Yuen, Joseph
Mr. Leung Pui Man, Calvin
Mr. Shinkichi Kaneko
Mr. Taizo Fujimoto
Ms. Ng Lai Kwan
9. Secretary : Ng Lai Kwan
10. Financial Year End : December 31
11. Auditors : Deloitte Touche Tohmatsu
(1) Subject to due diligence
-13-
J.I.C. ENTERPRISES (HONG KONG) LIMITED
1. Registered Number : 121718
2. Former Name : Nil
3. Date of Incorporation : 18th February 1983
4. Place of Incorporation : Hong Kong
5. Address of Registered Office : 15th Floor, China Merchants Tower, Shun Tak Centre, Nos.
168-200 Connaught Road Central, Hong Kong
6. Authorised Share Capital : HK$500,000 divided into 500,000 shares of HK$1 each
7. Issued Share Capital : 500,000 shares registered as to 499,999 shares in the name
of J.I.C. Group (B.V.I.) Limited and as to 1 share in the
name of J.I.C. Electronics Company Limited and beneficially
owned by J.I.C. Group (B.V.I.) Limited
8. Directors Mr. Li Shi Yuen, Joseph
Mr. Chui Kam Wai
Mr. Seitaro Furukawa
Mr. Tadao Murakami
Mr. Toshiaki Ogi
9. Secretary : Ng Lai Kwan
10. Financial Year End : December 31
11. Auditors : Deloitte Touche Tohmatsu
JETUP DEVELOPMENT LIMITED
1. Registered Number : 383237
2. Former Name : Nil
3. Date of Incorporation : 6 October, 1992
4. Place of Incorporation : Hong Kong
-14-
5. Address of Registered Office : 15th Floor, China Merchants Tower, Shun Tak Centre, Nos.
168-200 Connaught Road Central, Hong Kong
6. Authorised Share Capital : HK$1,000,000 divided into 1,000,000 shares of HK$1 each
7. Issued Share Capital : 1,000,000 shares registered as to 999,999 shares in the
name of J.I.C. Group (B.V.I.) Limited and as to 1 share in
the name of Joseph Shi Yuen Li and beneficially owned by
J.I.C. Group (B.V.I.) Limited
8. Directors : Mr. Li Shi Yuen, Joseph
Mr. Chui Kam Wai
Mr. Koo Ming Kown
Mr. Leung Hung Hum
Mr. Tadao Murakami
9. Secretary : Ng Lai Kwan
10. Financial Year End : December 31
11. Auditors : Deloitte Touche Tohmatsu
JIEDA ELECTRONIC (SHENZHEN) CO. LTD.
1. Registered Number : 300850
2. Former Name : Jiecheng Electronics (Shenzhen) Co., Ltd.
3. Date of Incorporation : 14th May 1992
4. Place of Incorporation : PRC
5. Address of Registered Office : 47th district, Bao An New City, Bao An Shenzhen, PRC
6. Registered Capital : HK$10,000,000
7. Directors : Mr. Li Shi Yuen, Joseph
Mr. Chui Kam Wai
Mr. Seitaro Furukawa
8. Financial Year End : December 31
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JIEYAO ELECTRONICS (SHENZHEN) CO., LTD
1. Registered Number : 303980
2. Former Name : Yie Yao Electronics (Shenzhen) Co. Ltd.
3. Date of Incorporation : September 1995
4. Place of Incorporation : PRC
5. Address of Registered Office : 71st district, Liu Xian Yi Lu, Bao An New City, Bao An,
Shenzhen, PRC
6. Registered Capital : HK$3,000,000
7. Directors : Mr. Taizo Fujimoto
Mr. Li Shi Yuen, Joseph
Mr. Law Chi Yin
Mr. Shinkichi Kaneko
Mr. Joseph Ling
8. Financial Year End : December 31
JETUP ELECTRONIC (SHENZHEN) CO., LTD.
1. Registered Number : 301553
2. Former Name : Nil
3. Date of Incorporation : April 1993
4. Place of Incorporation : PRC
5. Address of Registered Office : 47th district, Bao An New City, Bao An Shenzhen, PRC
6. Registered Capital : HK$131,000,000
7. Directors : Mr. Li Shi Yuen, Joseph
Mr. Chui Kam Wai
Mr. Yuen Lap Kei
Mr. Chang Yung Chang
Mr. Seitaro Furukawa
8. Financial Year End : December 31
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SCHEDULE 3
THE WARRANTIES
1. SALE SHARES
(A) The Seller is the sole beneficial owner of the Sale Shares and
is entitled to sell and transfer the full legal and beneficial
ownership of the same to the Purchaser or its nominees.
(B) The Sale Shares comprise the whole of the issued and allotted
share capital of the Company and all of them are fully paid up.
(C) The Company has no subsidiaries or associated companies (as
defined in the Companies Ordinance) and no shareholding or other
interest in any company, partnership, firm or other entity, save
as specified in the Target Group's organisational chart set out
in Schedule 1.
(D) The entire issued share capital of each Target Group Company
(other than that of the Company) is owned by another member of
the Target Group, and is held free from all liens, charges,
encumbrances, equities and adverse interests.
(E) There are no warrants to subscribe for, or options to acquire or
subscribe for, any share capital of any member of the Target
Group.
(F) No dividend or distribution has been declared or is proposed but
not paid by any member of the Target Group (other than a
dividend or distribution payable to another member of the Target
Group).
2. COMPLIANCE WITH LEGAL REQUIREMENTS
(A) Compliance has been made in all material respects with all
material legal and procedural requirements and other formalities
in connection with the Target Group concerning (a) the
Memorandum and Articles of Association, business licence or
other constitutional documents of each Target Group Company, (b)
the filing of all documents required by the applicable law to be
filed with any government authorities or regulatory bodies, (c)
issues of shares debentures or other securities, (d) payments of
interest and dividends and making of other distributions, and
(e) their Directors and other officers.
(B) Each Target Group Company is empowered and duly qualified to
carry on its business in Hong Kong and in each other country,
state or territory in which such business is presently carried
on.
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3. ACCURACY AND ADEQUACY OF INFORMATION
(A) The information given in the Schedules is true and accurate in
all material respects and is not misleading because of any
omission or ambiguity or for any other reason.
(B) The business licence and memorandum and articles of association
of each member of the Target Group are current, complete and
accurate in all material respects, have attached to them copies
of all resolutions and other documents required by law to be so
attached, and fully set out the rights and restrictions
attaching to each class, if any, of the share or registered
capital of the relevant Target Group Company.
(C) The statutory books (including all registers and minute books)
of each member of the Target Group have been properly kept and
contain (in respect of matters up to but not including
Completion) a record which is accurate and complete in all
material respects of the matters which should be dealt with in
those books and contain no material inaccuracies or
discrepancies and no notice or allegation that any of them is
incorrect or should be rectified has been received.
4. ACCOUNTS
(A) The Audited Accounts :-
(i) comply in all material respects with the requirements of
all applicable legislation;
(ii) are complete and accurate in all material respects;
(iii) give a true and fair view of the state of affairs and
financial position of the Target Group at the date
thereof and of the Target Group's results for the
financial period ended on such date; and
(iv) are not adversely affected by any unusual or
non-recurring items which are not disclosed in the
Audited Accounts.
(B) No member of the Target Group has any material outstanding
liability for Taxation of any kind which has not been provided
for or is not provided for in the Audited Accounts.
(C) Save as disclosed in the Audited Accounts, each member of the
Target Group owns free from encumbrances (other than title
retention in respect of goods and materials supplied in the
ordinary course of business and liens arising in the ordinary
course of business by operation of law) all its assets shown or
comprised in the relevant accounts and all such assets are in
its possession or under its control and there has been no
disposal of such assets (save for the stock in trade disposed of
in the ordinary course of business) since the date of relevant
accounts.
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(D) No member of the Target Group holds any material security which
is material to the Target Group (including any guarantee or
indemnity) which insofar as it is aware, is not valid and
enforceable by such member against the grantor thereof in
accordance with its terms.
(E) There has been no material adverse change in the financial
condition of any member of the Target Group since the financial
year end of the Audited Accounts.
5. INSOLVENCY
(A) No receiver has been appointed of the whole or any part of the
assets or undertaking of any member of the Target Group.
(B) No petition has been presented, no order has been made and no
resolution has been passed for the winding-up or dissolution of
any member of the Target Group.
(C) No member of the Target Group has stopped payment nor is it
insolvent or unable to pay its debts within the meaning of
section 178 of the Companies Ordinance.
(D) No unsatisfied judgment is outstanding against any member of the
Target Group.
6. LITIGATION
No member of the Target Group is engaged (whether as plaintiff,
defendant or otherwise) in any litigation or arbitration, administrative
or criminal or other proceeding which is of material importance to the
Target Group and no litigation or claims of material importance are
pending or threatened against any Target Group Company.
7. TAX RETURNS
Each member of the Target Group has, in respect of all years of
assessment since its incorporation falling before the date of this
Agreement, made or caused to be made all proper returns, and has
supplied or caused to be supplied all material information regarding
taxation matters which it is required to make or supply to any tax,
revenue, finance and customs authority and there is, at the date hereof,
no dispute or disagreement nor is any contemplated with any such
authority regarding the liability or potential liability to any tax or
duty (including in each case penalties and interest) or any member of
the Target Group or regarding the availability to any member of the
Target Group of any relief from tax or duty.
SCHEDULE 4
RIGHTS ATTACHED TO THE PREFERENCE SHARES
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The rights attaching, and provisions applicable, to the Preference Shares are as
follows:
1. PAYMENT OF DIVIDEND OR DISTRIBUTION
On any payment of dividend or distribution, the Preference Shares shall
rank pari passu with the Ordinary Shares.
2. RETURN OF CAPITAL
2.1 On a return of capital on liquidation, dissolution, winding up or
otherwise (but not upon any conversion of the Preference Shares)
(together a "LIQUIDATION") the assets of the Purchaser available for
distribution amongst the shareholders of the Purchaser shall be applied,
in priority to any payment to the holders of any other class of shares
in the capital of the Purchaser, in paying to the holders of the
Preference Shares ("PREFERENCE SHAREHOLDERS") HK$0.01 for every
Preference Share held.
2.2 If the assets of the Purchaser available for distribution amongst the
Preference Shareholders shall not be sufficient to satisfy in full the
payment referred to in paragraph 2.1 above in full then all the assets
available for distribution shall be applied rateably amongst the
Preference Shareholders in proportion to the number of the relevant
Preference Shares held by each such holder.
2.3 Provided that the payment referred to in paragraph 2.1 above is made in
full, the assets of the Company shall be applied in paying to the
holders of Ordinary Shares ("ORDINARY SHAREHOLDERS") the amount of
HK$0.01 for every Ordinary Share held.
2.4 Provided that the payments referred to in paragraphs 2.1 and 2.3 above
are made in full, the Preference Shares and Ordinary Shares shall rank
pari passu in any further distribution of assets.
3. VOTING RIGHTS
Preference Shareholders shall be entitled to receive notice of and to
attend and speak at all general meetings of the Purchaser but not to
vote.
4. CONVERSION
4.1 Subject as hereinafter provided and without prejudice to any rights with
respect to any accrued but unpaid dividends on Preference Shares, each
Preference Shareholder shall be entitled at any time and in the manner
set out in this Paragraph 4 to convert all or a portion of his/its
Preference Shares into fully paid Ordinary Shares (the "CONVERSION
RIGHT") at the rate of 1 Ordinary Share for every 1.03 Preference
Shares, (subject to adjustment in accordance with Paragraph 4.7 below
(the "CONVERSION RATE"). Provided that, for the purposes of ensuring the
continued listing of the Purchaser on HKSE after the conversion of the
Preference Shares, the Directors may, in their absolute discretion,
decline to allot and issue Ordinary Shares if, as a result of the
exercise by a Preference Shareholder of his/its Conversion Right, the
Ordinary Shares issued upon such conversion together with any Ordinary
Shares then in issue would result in the minimum prescribed percentage
of Ordinary Shares in "public hands" (as defined in the Listing Rules
from time to time) not being satisfied.
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4.2 The Conversion Right shall be exercisable by a Preference Shareholder by
delivering to the Purchaser the certificate relating to the Preference
Shares to be converted ("PREFERENCE SHARE CERTIFICATE") together with a
duly completed notice of conversion substantially in the form from time
to time prescribed by the board of directors (a "CONVERSION NOTICE")
(which notice shall specify a date being not less than [5 Business Days]
after the date of the Conversion Notice as the date for the conversion
to be effected (the "CONVERSION DATE")) in respect of all or a portion
of the Preference Shares held by such Preference Shareholder and
delivering the same to the Purchaser or to the agent of the Purchaser
appointed for such purpose at any time not less than [5 Business Days]
prior to a Conversion Date, together with such other evidence, if any,
as the board of directors may reasonably require to prove the title of
the person exercising such right and the payment of all taxes and stamp
issue and registration duties (if any) arising on conversion in any
jurisdiction. A Conversion Notice, once given, may not be withdrawn
without the consent in writing of the Purchaser. Subject to the
Directors not exercising their discretion in accordance with paragraph
4.1, conversion shall take place on the Conversion Date specified in the
Conversion Notice (in the place of delivery). The Preference Share
Certificate shall be cancelled on the relevant Conversion Date. In the
event that the Preference Share Certificate represents a greater number
of Preference Shares than is to be converted, the Purchaser shall,
within [3 Business Days] after the relevant Conversion Date issue to the
Preference Shareholder a new Preference Share Certificate for the
balance of the Preference Shares which are not to be converted.
4.3 Preference Shareholders shall be entitled to be paid any accrued but
unpaid dividends in respect of Preference Shares. The Ordinary Shares to
which any Preference Shareholder shall become entitled in consequence of
exercising his/its right to convert shall carry the right to receive all
dividends declared on such Ordinary Shares and other distributions
declared made or paid upon the Ordinary Shares in respect of the
financial year of the Purchaser in which such shares are allotted and
shall rank pari passu in all other respects and form one class with the
Ordinary Shares in issue at the relevant Conversion Date and fully paid
save that they shall not be entitled to any dividends or other
distributions declared, paid or made either in respect of any financial
period ended prior to such Conversion Date or by reference to a record
date prior to such Conversion Date or to the extent that the Preference
Shares so converted shall already have participated in such dividend.
4.4 Within [3 Business Days] after the relevant Conversion Date, the
Purchaser shall forward to each holder a definitive certificate for the
appropriate number of fully paid Ordinary Shares and, if appropriate, a
cheque in respect of any fractional entitlement.
4.5 So long as Preference Shares remain capable of being converted into
Ordinary Shares, then if the Purchaser is placed in Liquidation the
Purchaser shall forthwith give notice thereof in writing to all
Preference Shareholders.
4.6 Fractions of Ordinary Shares arising on conversion of Preference Shares
shall not be allotted and in such circumstances the number of Ordinary
Shares to be allotted shall be rounded down to the nearest whole number.
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4.7 Upon the happening of any of the following events, the Conversion Rate
shall be adjusted as follows:
(a) Consolidation, subdivision or reclassification
If and whenever there shall be an alteration to the nominal
value of the Ordinary Shares as a result of consolidation,
subdivision or reclassification, the Conversion Rate shall be
adjusted by multiplying the Conversion Rate in force immediately
prior to such alteration by the following fraction:
A
---
B
where:
A is the nominal amount of one Ordinary Share immediately after
such alteration; and
B is the nominal amount of one Ordinary Share immediately before
such alteration.
Such adjustment shall become effective on the date the
alteration takes effect.
(b) Issue of Shares by way of rights
If and whenever the Purchaser shall issue Ordinary Shares to all
or substantially all Ordinary Shareholders as a class by way of
rights, or issue or grant to all or, substantially all Ordinary
Shareholders as a class by way of rights, options, warrants or
other rights to subscribe for or purchase any Ordinary Shares,
in each case at less than the Current Market Price per Ordinary
Share on the last dealing day preceding the date of the
announcement of the terms of the issue or grant, the Conversion
Rate shall be adjusted by multiplying the Conversion Rate in
force immediately before such issue or grant by the following
fraction:
A+B
---
A+C
where:
A is the number of Ordinary Shares in issue immediately before
such announcement;
B is the number of Ordinary Shares which the aggregate amount
(if any) payable for the Ordinary Shares issued by way of rights
or for the options or warrants or other rights issued by way of
rights and the total amount payable for the total number of new
Ordinary Shares comprised therein would purchase at such Current
Market Price per Ordinary Share; and
-22-
C is the aggregate number of Ordinary Shares issued or, as the
case may be, comprised in the grant.
Such adjustment shall become effective from the commencement of
the day following the record date of the issue or grant.
(c) Issue of other securities by way of rights
If and whenever the Purchaser shall issue any securities (other
than Ordinary Shares or options, warrants or other rights to
subscribe or purchase Ordinary Shares) to all or substantially
all Ordinary Shareholders as a class by way of rights or grant
to all or substantially all Ordinary Shareholders as a class any
options, warrants or other rights to subscribe for or purchase
any securities (other than Ordinary Shares or options, warrants
or other rights to subscribe or purchase Shares) by way of
rights, the Conversion Rate shall be adjusted by multiplying the
Conversion Rate in force immediately before such issue or grant
by the following fraction:
A - B
-----
A
where:
A is the Current Market Price of one Ordinary Share on the last
dealing day preceding the date on which such issue or grant is
publicly announced; and
B is the fair market value on the date of such announcement, as
determined in good faith by an Approved Merchant Bank acting as
an expert, of the portion of the rights attributable to one
Share.
Such adjustment shall become effective from the commencement of
the day following the record date of the issue or grant.
(d) Issue of Shares other than by way of rights
If and whenever the Purchaser shall issue (otherwise than as
mentioned in (d) above) wholly for cash any Ordinary Shares
(other than Ordinary Shares issued on the exercise of Conversion
Rights or on the exercise of any other rights, if any, of
conversion into, or exchange or subscription for, Ordinary
Shares) or issue or grant (otherwise than as mentioned in (b)
above) wholly for cash options, warrants or other rights to
subscribe for or purchase Ordinary Shares in each case at a
price per Ordinary Share which is less than the Current Market
Price per on the last dealing day preceding the date of
announcement of the terms of such issue, the Conversion Rate
shall be adjusted by multiplying the Conversion Rate in force
immediately before such issue by the following fraction:
A+B
---
-23-
C
where:
A is the number of Ordinary Shares in issue immediately before
the issue of such additional Ordinary Shares;
B is the number of Ordinary Shares which the aggregate
consideration receivable for the issue of such additional
Ordinary Shares would purchase at such Current Market Price per
Ordinary Share; and
C is the number of Shares in issue immediately after the issue
of such additional Shares.
References to additional Ordinary Shares in the above formula
shall, in the case of an issue by the Purchaser of options,
warrants or other rights to subscribe or purchase Shares, mean
such Ordinary Shares to be issued assuming that such options,
warrants or other rights are exercised in full at the initial
exercise price on the date of issue of such options, warrants or
other rights.
Such adjustment shall become effective on the date of issue of
such additional Ordinary Shares.
(e) Issue of Shares upon conversion or exchange
Save in the case of an issue of securities arising from a
conversion or exchange of other securities in accordance with
the terms of such securities themselves falling within this
provision, if and whenever the Purchaser or any of its
Subsidiaries (otherwise than as mentioned in (b), (c) and (d)
above), or (at the direction or request of or pursuant to any
arrangements with the Purchaser or any of its Subsidiaries) any
other company, entity or person shall issue wholly for cash any
securities which by their terms carry rights of conversion into,
or exchange or subscription for, Ordinary Shares to be issued by
the Purchaser on conversion, exchange or subscription (or shall
grant any such rights in respect of existing securities so
issued) or securities which might by their terms be redesignated
as Ordinary Shares, and the consideration per Ordinary Share
receivable by the Purchaser or the relevant Subsidiary on
conversion, exchange, subscription or redesignation is less than
the Current Market Price per Ordinary Share on the last dealing
day preceding the date of announcement of the terms of issue of
such securities (or the terms of such grant), the Conversion
Rate shall be adjusted by multiplying the Conversion Rate in
force immediately before such issue by the following fraction:
A+B
---
A+C
where:
-24-
A is the number of Ordinary Shares in issue immediately before
such issue or grant;
B is the number of Ordinary Shares which the aggregate
consideration receivable by the Purchaser for the Ordinary
Shares to be issued on conversion or exchange or on exercise of
the right of subscription attached to such securities would
purchase at such Current Market Price per Share; and
C is the maximum number of Ordinary Shares to be issued on
conversion or exchange of such securities or on the exercise of
such rights of subscription attached thereto at the initial
conversion, exchange or subscription price or rate.
Such adjustment shall become effective on the date of issue of
such securities (or grant of such rights).
(f) Modification of rights of conversion or exchange
If and whenever there shall be any modification of the rights of
conversion, exchange or subscription attaching to any such
securities as are mentioned in (e) above (other than in
accordance with the terms applicable to such securities) so that
the consideration per Ordinary Share receivable by the Purchaser
or the relevant Subsidiary is less than the Current Market Price
per Ordinary Share on the last dealing day preceding the date of
announcement of the proposals for such modification, the
Conversion Rate shall be adjusted by multiplying the Conversion
Rate in force immediately before such modification by the
following fraction:
A+B
---
A+C
where:
A is the number of Ordinary Shares in issue immediately before
such modification;
B is the number of Ordinary Shares which the aggregate
consideration receivable by the Purchaser for the Ordinary
Shares to be issued on conversion or exchange or on exercise of
the right of subscription attached to the securities so modified
would purchase at such Current Market Price per Ordinary Share;
and
C is the maximum number of Ordinary Shares to be issued on
conversion or exchange of such securities or on the exercise of
such rights of subscription attached thereto at the modified
conversion, exchange or subscription price or rate but giving
credit in such manner as an Approved Merchant Bank acting as an
expert, shall consider appropriate (if at all) for any previous
adjustment under this provision or (e) above.
-25-
Such adjustment shall become effective on the date of
modification of the rights of conversion, exchange or
subscription attaching to such securities.
(g) Offers for Shares
If and whenever the Purchaser or any of its Subsidiaries or (at
the direction or request of or pursuant to any arrangements with
the Purchaser or any of its Subsidiaries) any other company,
person or entity issues, sells or distributes any securities in
connection with an offer pursuant to which the Ordinary
Shareholders generally (meaning for these purposes holders of at
least 60 per cent. of the Ordinary Shares in issue at the time
such offer is made) are entitled to participate in arrangements
whereby such securities may be acquired by them (except where
the Conversion Rate falls to be adjusted under (d) to (g)
above), the Conversion Rate shall be adjusted by multiplying the
Conversion Rate in force immediately before such issue by the
following fraction:
A - B
-----
A
where:
A is the Current Market Price of one Ordinary Share on the last
dealing day preceding the date on which such issue is publicly
announced; and
B is the fair market value on the date of such announcement, as
determined in good faith by an Approved Merchant Bank acting as
an expert, of the portion of the relevant offer attributable to
one Ordinary Share.
Such adjustment shall become effective on the date of issue of
the securities.
(h) Other events
If the Purchaser determines that an adjustment should be made to
the Conversion Rate as a result of one or more events or
circumstances not referred to in this paragraph 4.7 (even if the
relevant event or circumstance is specifically excluded from the
operation of all or any of the other relevant sub-paragraphs of
this paragraph 4.7) the Purchaser shall, at the Purchaser's
expense, appoint an Approved Merchant Bank to determine (acting
as an expert) as soon as practicable what adjustment (if any) to
the Conversion Rate is fair and reasonable to take account
thereof and the date on which such adjustment should take effect
and upon such determination such adjustment (provided that the
adjustment would result in a reduction in the Conversion Rate)
shall be made and shall take effect in accordance with such
determination. Provided that an adjustment shall only be made
pursuant to this sub-paragraph (h) if an Approved Merchant Bank
is so requested to make such a determination provided that where
the circumstances giving rise to an adjustment pursuant to this
paragraph 4.7 have already resulted or will result in an
adjustment to the Conversion Rate or where the circumstances
giving rise to any adjustment arise by virtue of any other
circumstances which have
-26-
already given or will give rise to an adjustment to the
Conversion Rate, such modification (if any) shall be made to the
operation of this paragraph 4.7 as may be advised by an Approved
Merchant Bank to be in its opinion appropriate to give the
intended result.
(i) For the purpose of any calculation of the consideration
receivable pursuant to (d), (e) and (f) above, the following
provisions shall apply:
(i) the aggregate consideration receivable for Ordinary
Shares issued for cash shall be the amount of such cash
provided that in no case shall any deduction be made for
any commission or any expenses paid or incurred by the
Purchaser for any underwriting of the issue or otherwise
in connection therewith;
(ii) (x) the aggregate consideration receivable for the
Ordinary Shares to be issued upon the conversion or
exchange of any securities shall be deemed to be the
consideration received or receivable by the Purchaser
for any such securities and (y) the aggregate
consideration receivable for the Ordinary Shares to be
issued upon the exercise of rights of subscription
attached to any securities shall be deemed to be that
part (which may be the whole) of the consideration
received or receivable by the Purchaser for such
securities which is attributed by the Purchaser to such
rights of subscription or, if no part of such
consideration is so attributed, the fair market value of
such rights of subscription as at the date of the
announcement of the terms of issue of such securities
(as determined in good faith by an Approved Merchant
Bank acting as an expert), plus in the case of each of
(x) and (y) above, the additional minimum consideration
(if any) to be received by the Purchaser upon the
conversion or exchange of such securities, or upon the
exercise of such rights of subscription attached thereto
(the consideration in all such cases to be determined
subject to the proviso in (i)(i)), and (z) the
consideration per Ordinary Share receivable by the
Purchaser upon the conversion or exchange of, or upon
the exercise of such rights of subscription attached to,
such securities shall be the aggregate consideration
referred to in (x) or (y) above (as the case may be)
converted into HK dollars if such consideration is
expressed in a currency other than HK dollars at such
rate of exchange as may be determined in good faith by
an Approved Merchant Bank acting as an expert to be the
spot rate ruling at the close of business on the date of
announcement of the terms of issue of such securities,
divided by the number of Shares to be issued upon such
conversion or exchange or exercise at the initial
conversion, exchange or subscription price or rate.
(j) If the Conversion Date in relation to any Preference Shares
shall be after the record date for any such issue, distribution,
grant or offer (as the case may be) as is mentioned in
paragraphs (b), (c) and (g), or any such issue as is mentioned
in paragraphs (d) and (e) which is made to the Ordinary
Shareholders or any of them, but before the date of issue of the
Ordinary Shares or other securities (in the case of paragraphs
(b), (c) and (e)), before the
-27-
date on which the issue or grant is made (in the case of
paragraph (b) or (c)) or before securities are acquired in the
case of paragraph (g), the Purchaser shall procure that there
shall be issued to the converting Preference Shareholder or in
accordance with the instructions contained in the Conversion
Notice (subject to any applicable exchange control or other
regulations) such additional number of Ordinary Shares as,
together with the Ordinary Shares issued or to be issued on
conversion of the relevant Preference Shares, is equal to the
number of Ordinary Shares which would have been required to be
issued on conversion of such Preference Shares if the relevant
adjustment (more particularly referred to in the said
paragraphs) to the Conversion Rate had in fact been made
immediately after the relevant record date. Such additional
Ordinary Shares will be allotted as at, and within [5 Business
Days] after, the relevant Conversion Date or of the date of
issue of Ordinary Shares if adjustment results from the issue of
Ordinary Shares and certificates for such Ordinary Shares (if
the Shares are in certificate form) will be despatched within
such period of [5 Business Days].
(k) No adjustment will be made to the Conversion Rate when Ordinary
Shares or other securities (including rights or options) are
issued, offered or granted to officers and/or employees of the
Purchaser or any Subsidiary of the Purchaser pursuant to any
option scheme or similar arrangement for the time being adopted
by the Purchaser whereby officers and/or employees of the
Purchaser or any subsidiary of the Purchaser are granted the
Shares or the right to acquire Ordinary Shares in the capital of
the Purchaser.
(l) Where more than one event which gives or may give rise to an
adjustment to the Conversion Rate occurs within such a short
period of time that in the opinion of an Approved Merchant Bank
the foregoing provisions would need to be operated subject to
some modification In order to give the intended result, such
modification shall be made to the operation of the foregoing
provisions as may be advised by an Approved Merchant Bank to be
in its opinion appropriate in order to give such intended
result.
(m) If any doubt shall arise as to the appropriate adjustment to the
Conversion Rate, a certificate of an Approved Merchant Bank
shall be conclusive and binding on all concerned save in the
case of manifest or proven error.
(n) In default of the Purchaser appointing an Approved Merchant Bank
when required for the purposes of this clause, a majority of the
Preference Shareholders shall be entitled to appoint such a bank
(at the expense of the Purchaser).
For the purpose of this paragraph 4.7:
"APPROVED MERCHANT BANK" means an independent merchant bank of repute
reasonably selected by the Purchaser and approved in writing by a
majority of the Preference Shareholders or, failing agreement, nominated
at the request of the Purchaser and/or a majority of the Preference
Shareholders by the president for the time being of the Hong Kong Law
Society.
-28-
"CURRENT MARKET PRICE" means, in respect of an Ordinary Share at a
particular date, the average of the daily closing prices (as derived
from the Daily Quotation Sheet of HKSE) for one Ordinary Share (being an
Ordinary Share carrying full entitlement to dividend) for the five
consecutive dealing days ending on the dealing day immediately preceding
such date; provided that if during some part of the said five dealing
day period the Ordinary Shares shall have quoted ex-dividend and during
some other part of that period the Ordinary Shares shall have been
quoted cum-dividend then:
(i) if the Ordinary Shares to be issued do not rank for the dividend
in question, the closing prices on the dates on which the
Ordinary Shares shall have been quoted cum-dividend shall for
the purpose of this definition be deemed to be the amount
thereof reduced by an amount equal to the amount of that
dividend per Ordinary Share; and
(ii) if the Ordinary Shares to be issued rank for the dividend in
question, the closing prices on the dates on which the Ordinary
Shares shall have been quoted ex-dividend shall for the purpose
of this definition be deemed to be the amount thereof increased
by such similar amount;
and provided further that if the Ordinary Shares on each of the said
five dealing days have been quoted cum-dividend in respect of a dividend
which has been declared or announced but the Shares to be issued do not
rank for that dividend, the closing price on each of such dates shall
for the purpose of this definition be deemed to be the amount thereof
reduced by an amount equal to the amount of that dividend per Ordinary
Share.
5. NO FRACTIONAL SHARES AND CERTIFICATE AS TO ADJUSTMENTS
5.1 No fractions of Ordinary Shares shall be issued upon the conversion of
any Preference Shares. Any fractions of Ordinary Shares arising on
conversion of Preference Shares shall be dealt with in accordance with
paragraph 4.6 of this Schedule 4. Whether or not fractional shares are
issuable upon such conversion shall be determined on the basis of the
total number of Preference Shares the Preference Shareholder is at the
time converting into Ordinary Shares and the number of Ordinary Shares
issuable upon such aggregate conversion.
5.2 Upon the occurrence of each adjustment of the Conversion Rate pursuant
to this Schedule 4, the Purchaser, at its expense, shall promptly
compute such adjustment in accordance with the terms hereof and prepare
and furnish to each Preference Shareholder a certificate setting out
such adjustment and showing in detail the facts upon which such
adjustment is based. The Purchaser shall, upon the written request at
any time of any Preference Shareholder, furnish or cause to be furnished
to such Preference Shareholder a like certificate setting out (a) such
adjustment, (b) the Conversion Rate for such series of Preference
Shareholders at the time in effect, and (c) the number of Ordinary
Shares and the amount, if any, of other property that at the time shall
be received upon the conversion of a Preference Share.
6. NOTICES OF RECORD DATE
-29-
In the event of any taking by the Purchaser of a record of the holders
of any class of securities for the purpose of determining the holders
thereof who are entitled to receive any dividend (other than a cash
dividend) or other distribution, any right to subscribe for, purchase or
otherwise acquire any shares of any class or any other securities or
property, or to receive any other right, the Purchaser shall mail to
each Preference Shareholder, at least 20 days prior to the date
specified therein, a notice specifying the date on which any such record
is to be taken for the purpose of such dividend, distribution or right,
and the amount and character of such dividend, distribution or right.
7. RESERVATION OF SHARES ISSUABLE UPON CONVERSION
The Purchaser shall at all times reserve and keep available out of its
authorised but unissued Ordinary Share capital, solely for the purpose
of effecting the conversion of the Preference Shares, such number of
Ordinary Shares as shall from time to time be sufficient to effect the
conversion of all the Preference Shares; and if at any time the number
of authorised but unissued Ordinary Shares shall not be sufficient to
effect the conversion of all the Preference Shares, in addition to such
other remedies as shall be available to the Preference Shareholder
concerned, the Purchaser shall take such corporate action as may be
necessary to increase its authorised but unissued Ordinary Share capital
to such number of Ordinary Shares as shall be sufficient for such
purposes, including, without limitation, engaging in best efforts to
obtain the requisite shareholders' approval of any necessary amendment
to the Memorandum and the Articles.
8. TRANSFER OF PREFERENCE SHARES
Any transfer or assignment of the Preference Shares shall be subject to
the approval of the board of directors and shall be made not less than
500,000 Preference Shares or, if less, the number of Preference Shares
then held by the Preference Shareholders.
-30-
EXECUTED by the parties
SIGNED BY )
for and on behalf of )
NAM TAI ELECTRONICS, INC. )
in the presence of:- )
) --------------------------
Witnessed by
- -------------------------------------
Name:
Title:
SIGNED BY )
For and on behalf of )
J.I.C. TECHNOLOGY COMPANY LIMITED )
)
in the presence of:- )
) --------------------------
Witnessed by
- -------------------------------------
Name:
Title: