DATED THIS 28TH DAY OF
SEPTEMBER, 2001
BETWEEN
NU SKIN
ENTERPRISES, INC.
AND
KIOW XXX XXXX, XXXXXXX
AND
DATO' MOHD NADZMI BIN MOHD SALLEH
SHAREHOLDERS AGREEMENT
(between shareholders of
NU SKIN MALAYSIA HOLDINGS SDN. BHD.)
KHAW & PARTNERS
ADVOCATES& SOLICITORS
KUALA LUMPUR
THIS AGREEMENT is made this 28th day of September 2001
BETWEEN
NU SKIN ENTERPRISES, INC., (Registration
No. 2659781), a
company incorporated in the State of Delaware, United States of America and
having its principal place of business at 00 Xxxx Xxxxxx Xxxxxx, Xxxxx, Xxxx
00000, Xxxxxx Xxxxxx of America of the first part
AND
KIOW XXX XXXX, XXXXXXX
(NRIC No. 570723-08-6077) (Former NRIC No. 5276427) of 00, Xxxxx Xxxxxxx, Xxxxx-Xxx Xxxx,
Xxxxx Baru of the second part.
AND
DATA' MOHD NADZMI BIN MOHD SALLEH
(NRIC No. 540501-03-5293) of Xx. 00-0, Xxxxx XXX0/0X, Xxxxxxx Xxxxxxxx Xxxxxx, Xxxxxx
Xxxxxxxxx Xxxxxxx, 00000 Petailing Jaya, Selangor Darul Ehsan of the third part.
WHEREAS:-
| |
|
A) |
NSMH is a private limited
company incorporated in Malaysia on 3.7.2001. |
| |
|
|
|
| |
|
B) |
As at the date of this Agreement:-
|
| |
|
|
i) |
the authorised share capital of NSMH is RM5,000,000.00 (Ringgit Five Million)
divided into:- |
| |
|
|
|
|
| |
|
|
|
a) 2,500,000
(Two Million Five Hundred Thousand) NSMH Shares; and |
| |
|
|
|
|
| |
|
|
|
b) 2,500,000
(Two Million FIve Hundred Thousand) ICPS; |
| |
|
|
ii) |
the issued and paid up share capital of NSMH is RM2,500,002.00 (Ringgit Two Million Five
Hundred Thousand and Two) divided into 2 (Two) NSMH Shares and 2,500,000 (Two Million FIve Hundred)
ICPS, all of which are held by NSE, a public listed company whose shares are publicly traded on the New York
Stock Exchange; |
| |
|
|
iii) |
the directors of NSMH all being NSE's representatives are the following persons:-
a) XXXXX X. XXXXX;
b) XXXXXX X. XXXX;
c) XXXX XXX SANG; and
|
2
| |
|
|
|
d) XXXX XX KOK; and |
| |
|
|
|
|
| |
|
|
iv) |
NSMH is currently not carrying on any other business except for its holding of NSMY Shares. |
| |
|
|
|
|
| |
II. |
NSMY |
|
|
| |
|
|
|
|
| |
|
A) |
NSMY, a wholly owned subsidiary of NSMH, is a private limited company
incorporated in Malaysia on 19.9.1996. |
|
| |
|
|
|
|
| |
|
B) |
As at the date of this Agreement:- |
|
| |
|
|
|
|
| |
|
|
i) |
the authorised share
capital of NSMY is RM5,000,000.00 (Ringgit Five Million) divided into 5,000,000 (Five
Million) NSMY Shares; |
| |
|
|
|
|
| |
|
|
ii) |
the issued and paid up
share capital of NSMY is RM2.500,002.00 (Ringgit
Two Million Five Hundred Thousand and Two) divided into 2,500,002 (Two
Million Five Hundred Thousand and Two) NSMY Shares held by NSMH; and |
| |
|
|
|
|
| |
|
|
iii) |
the directors of NSMY all being NSE's representatives are the following persons:-
a) XXXXX X. XXXXX;
b) XXXXXX X. XXXX;
c) KHAW YEW-MEI; and
d) XXXX XX KOK. |
|
C) |
By its letter dated 12th September 2001 bearing reference KPDN (DN) (JL)
8/6/1-935 Jld 5(3) to NSMY, the Controller of Direct Sales of the MDTCA approved
NSMY's application for a DS Licence for a duration of 1 (One) year
subject, among others, to the condition that it ensures that at least 40%
(Forty Percent) of the shares in NSMY are held by Bumiputera. |
|
D) |
The DS Licence was issued to NSMY on 18th September 2001 and NSMY will commence
a multi level direct sales business on 6th November 2001. |
III.
RESTRUCTURE OF NSMH
|
A) |
To fulfill, among others, the equity condition in the DS Approval, NSE is willing
to restructure NSMH (as the holding company of NSMY) and to divest, in the
manner described in Recitals III(C) to III(E), its right to 70% (Seventy
percent) of its effective equity shareholdings in NSMY to Malaysians, including
40% (Forty percent) thereof to Bumiputera Malaysians. |
|
B) |
NSE has entered into the SPA(FK) and SPA(Nadzmi) to divest to XXXXXXX and
DATO’ NADZMI respectively, its rights to FK’s Block and Nadzmi’s
Block. |
3
|
C) |
NSE is currently in discussions with LEMBAGA TABUNG ANGKATAN TENTERA with a view
to its being the Malaysian Bumiputera investor to whom NSE will divest its
rights to the 20% Block. |
|
D) |
XXXXXXX and DATO’ NADZMI agree that following NSE's divestment of its
rights to the 20% Block to LEMBAGA TABUNG ANGKATAN TENTERA and/or the Other
Bumiputera Investors, the respective equity interests of XXXXXXX and DATO'
NADZMI in the enlarged share capital of NSMH will be diluted accordingly. |
|
E) |
As currently envisaged, NSMH's equity restructuring exercise require NSE:- |
| |
|
|
i) |
to convert 1,999,999 (One Million Nine Hundred Ninety Nine Thousand Nine Hundred
and Ninety Nine) ICPS into 1,999,999 (One Million Nine Hundred Ninety Nine
Thousand Nine Hundred and Ninety Nine) NSMH Shares; |
| |
|
|
|
|
| |
|
|
ii) |
to complete in accordance with the provisions of the SPA(FK) and
SPA(Nadzmi), the sale by NSE to XXXXXXX and DATO’ NADZMI respectively
of FK’s Block and Nadzmi’s Block. |
| |
|
|
|
|
| |
|
|
iii) |
following the fulfillment of all of the conditions precedent under the SPA (OBI) for sale
of the 20% Black to the Other Bumiputera Investor:- |
| |
|
|
|
a) |
to convert the remaining 500,001 (Five Hundred and One) ICPS held
by NSE in NSMH into 500,001 (Five Hundred and One) NSMH Shares;
and |
| |
|
|
|
|
|
| |
|
|
|
b) |
to complete in
accordance with the provisions of the SPA(OBI), the sale by NSE to the Other
Bumiputera Investor of the 20% Block. |
IV.
SHAREHOLDERS AGREEMENT
The PARTIES are desirous of:-
|
A) |
regulating the relationship between them as holders of NSMH Shares following the
completion of the sale and purchase of NSMH Shares under the SPA(FK) and
SPA(Nadzmi); and |
| |
|
|
|
B) |
making provision for the management and operations of NSMH and NSMY and the
conduct of NSMH’s and NSMY’s affairs. |
NOW
THEREFORE in consideration of the mutual agreements herein
contained each of the PARTIES HEREBY AGREES with the other
PARTIES as follows:-
4
| |
1. |
DEFINITIONS &
INTERPRETATION |
| |
|
In this Agreement, unless the context otherwise requires, the following expressions
shall have the meanings set forth opposite such expressions:- |
| |
"Affiliate" |
: |
with respect to any
specified person, any other person that directly or
indirectly, through one or more intermediaries, controls, is controlled by, or
under common control with, such specified person |
| |
"Annual Business Plan" |
: |
NSMY's annual
business plan as adopted by NSMY for a financial year of NSMY |
| |
"Auditors" |
: |
PricewaterhouseCoopers or
such other major international accounting firm as
may be appointed by (as applicable) NSMH Members and NSMH from time to time as
the auditors of (as applicable) NSMH and NSMY |
| |
"Board" |
: |
the Board of Directors
of (as applicable) NSMH and NSMY |
| |
"Call Notice" |
: |
a notice served by
NSE pursuant to Clause 7.2 |
| |
"Call Option" |
: |
the option granted by each of XXXXXXX and DATO' NADZMI to
NSE pursuant to Clause 7.1 |
| |
"Certified Value" |
: |
the value of a NSMH Share, as valued/calculated and certified
by the Valuers (acting as experts and not as arbitrators) using a multiple of
5 (Five) times of NSMY’s net earnings per share (determined in
accordance with Generally Accepted Accounting Principles) for the preceding
12 (Twelve) months |
| |
"Cos Act" |
: |
the Companies Xxx 0000 and all subsidiary legislation and
all amendments thereto in force from time to time |
| |
"Dato' Nadzmi" |
: |
DATO' MOHD NADZMI BIN MOHD
SALLEH (NRIC No. 540501-03-5293) of Xx. 00-0, Xxxxx XXX0/0X, Xxxxxxx Xxxxxxxx
Xxxxxx, Xxxxxx Xxxxxxxxx Xxxxxxx, 00000 Xxxxxxxx Xxxx, Xxxxxxxx Darul
Ehsan |
| |
"Deductibles" |
: |
the aggregate of:- |
| |
|
|
|
|
i) |
any indebtedness then due, owing and/or payable by
(as applicable) XXXXXXX or DATO' NADZMI to NSE; and |
| |
|
|
|
|
ii) |
the aggregate of such portion of the purchase price payable by (as applicable)
XXXXXXX or DATO’ NADZMI for any NSMH Shares purchased by him from NSE and
interest accrued on such portion the right to the payment whereof shall have
been waived or forgiven by NSE |
| |
"Defaulting Party" |
: |
the PARTY referred to in Clauses 15.1.1 to 15.1.7 |
| |
"Director" |
: |
a director of (as applicable) NSMH and NSMY |
| |
"DS Act" |
: |
Direct Sales Xxx 0000 and all subsidiary legislation (including
the Direct Sales Regulations 1993) and all amendments thereto in force from time
to time |
| |
"DS' Approval" |
: |
the approval of MDTCA described in Recital II(C) |
| |
"DS Business" |
: |
multi-level direct
sale/marketing business of the Products |
| |
"DS Licence" |
: |
the multi-level direct sales licence No. AJL 931384 issued
on 18th September 2001 to NSMY pursuant to the DS Act |
| |
"Effective Clauses" |
: |
Clauses 1, 2, 16.2, 17, 18, 20 and 22 to 33 |
| |
"Encumberance" |
: |
a lien, pledge, charge, mortgage, assignment or other
encumbrance or security interest |
| |
"Event of Default" |
: |
any of the events described in Clauses 15.1.1 to 15.1.7 |
| |
"Financial Year" |
: |
a financial period of 12 (Twelve) months ending on 31st
December of each calendar year in respect of which the accounts of (as
applicable) NSMH and NSMY will be made up and audited |
| |
"Fixed Value" |
: |
in relation to a NSMH Share, whichever shall be the HIGHER
of:- |
| |
|
|
|
|
i) |
the Minimum Amount divided by the total number of NSMH Shares held by the
proposed transferor; and |
| |
|
|
|
|
ii) |
the remainder of such amount as shall be the LOWER of
the following values after deducting the Deductibles from such amount:-
a) the Certified Value; and
b) the price offered to the proposed transferor by a bona fide third party purchaser. |
| |
"FK's Black" |
: |
750,000 (Seven Hundred Fifty Thousand) NSMH Shares to be
acquired by XXXXXXX pursuant to the SPA(FK) |
| |
"force majeure" or "vis major" |
: |
acts of God, strikes,
lockout, war, blockades, revolutions,
fire, riots, insurrections, civil commotions, lightning, fire,
storm, floods, earthquakes, explosions, embargoes, government restraint or
regulation and any other cause whether of the kind specifically hereinbefore
referred to or otherwise which is not reasonably within the control of the PARTY
thereby affected |
| |
"XXXXXXX" |
: |
KIOW XXX XXXX, XXXXXXX (NRIC No. 570723-08-6077) (former
NRIC No. 5276427) of 00, Xxxxx Xxxxxxx, Xxxxx-Xxx Xxxx,
Xxxxx Xxxx, Xxxxx |
| |
"ICPS" |
: |
an irredeemable convertible non voting preference share
having a par value of RM1.00 (Ringgit One) in NSMH |
| |
"Inter-co Agreement" |
: |
an agreement, arrangement and/or transaction entered into
by (as applicable) NSMH or NSMY with NSE and/or its Affiliates, including but
not limited to the agreements referred to in Clause 13.11.2 and all amendments
and modifications thereto as may be agreed upon in writing between the parties
to such agreement, arrangement or transaction |
| |
"Key Issue (Board)" |
: |
any of the matters described in Clause 9.5 |
| |
"Key Issue (Members)" |
: |
any of the matters described in Clause 11 |
| |
"laws" |
: |
statutes, ordinances, enactments, by-laws, rules, regulation, regulatory
requirements, directives, policies guidelines, orders, instruments and the like
of government, semi or quasi governmental department, agency committed or body
and the like whether or not having the force of law |
| |
"M&A" |
: |
(as applicable) NSMH's and NSMY's Memorandum and Articles
of Association |
| |
"MD" |
: |
the managing director of (as applicable) NSMH and NSMY from
time to time |
| |
"MDTCA" |
: |
MINISTRY OF DOMESTIC TRADE & CONSUMER AFFAIRS, Malaysia |
| |
"MDTCA Approval" |
: |
the approval of MDTCA to the sale and purchase of direct
and indirect equity interest in NSMY |
| |
"Minimum Amount" |
: |
the total of the average price paid/payable by (as
applicable) XXXXXXX or DATO’ NADZMI for each NSMH Share acquired by them
from NSE multiplied by the total NSMH Shares then held by (as applicable)
XXXXXXX or DATO’ NADZMI LESS the Deductibles |
| |
"Nadzmi's Block" |
: |
500,001 (Five Hundred and One) NSMH Shares to be acquired
by DATO' NADZMI pursuant to the SPA(Nadzmi) |
| |
"Non-Defaulter" |
: |
a PARTY who is not the Defaulting Party |
| |
"NSE" |
: |
NU SKIN ENTERPRISES, INC. above described and includes its
Affiliates |
| |
"NSI" |
: |
NU SKIN INTERNATIONAL, INC., a company incorporated in the
State of Delaware, United States of America and having its
principal place of business at 00 Xxxx Xxxxxx Xxxxxx,
Xxxxx, Xxxx 00000, Xxxxxx Xxxxxx of America |
| |
"NSI Confidential Information" |
: |
any and all information that is unique,
proprietary or competitively sensitive to the business of NSI and/or any
Affiliate of NSI which NSMY may obtained knowledge of or access to in connection
with its relationship with NSI and its Affiliates and the transactions
contemplated by the Inter-co Agreements, including, but not limited to,
information relating to the Products, the NSI Independent Distributors,
NSI’s compensation or commission systems or schemes, pricing methods,
historical, current and projected financial information, marketing information,
and any and all information, technical data and know how related to any aspect
of NSI’s or any of its Affiliates’ business or technology including
data, know how, formulae, designs, drawings, proposals, specifications, and the
terms of the Inter-co Agreements |
| |
"NSI Independent Distributor" |
: |
a person authorised by contract with NSI to
distribute, as an independent contractor, the Products in accordance with the
terms of such distributor contract |
| |
"NSMY" |
: |
NU SKIN (MALAYSIA) SDN. BHD. (Company No. 402787-V), a
company incorporated in Malaysia under the Companies Xxx
0000 and having its registered address at x/x 0xx Xxxxx,
Xxxxxx Xxxxxxxx, Xx. 00, Xxxxx Xxxx Xxxxxx, 00000 Xxxxx
Xxxxxx |
| |
"NSMY Confidential Information" |
: |
any and all information that is unique,
proprietary or competitively sensitive to the business of NSMY but specifically
excluding the NSI Confidential Information |
| |
"NSMH" |
: |
NU SKIN MALAYSIA HOLDINGS SDN. BHD. (Company No. 552189-P),
a company incorporated in Malaysia under the Companies Xxx
0000 and having its registered address at x/x 0xx Xxxxx,
Xxxxxx Xxxxxxxx, Xx. 00, Xxxxx Xxxx Xxxxxx, 00000 Xxxxx
Xxxxxx |
| |
"NSMH Member" |
: |
a holder of NSMH Shares registered in NSMH's Register of
Members |
| |
"NSMH Share" |
: |
an ordinary share having a par value of RM1.00 (Ringgit
One) in NSMH |
| |
"NSMY Share" |
: |
an ordinary share having a par value of RM 1.00 (Ringgit One) in NSMY |
| |
"Offer" |
: |
an offer to sell the Subject Shares made pursuant to Clause 6.3 |
| |
"Offeree" |
: |
the NSMH Member to whom the Offer is made
|
| |
"Offeror" |
: |
the NSMH Member whose NSMH Shares are subject to an Offer
|
| |
"Offer Period" |
: |
30 (Thirty) days from the Offeree's receipt of the Offer in writing |
| |
"Other Bumiputera Investor" |
: |
such prospective Malaysian Bumiputera
investor(s) (other than Dato’ Nadzmi) as is identified by and as is
acceptable to the VENDOR to acquire the 20% Block |
| |
"PARTIES" |
: |
NSE, XXXXXXX and DATO NADZMI and includes any person, firm
or company who delivers a Shareholder's Undertaking |
| |
"PARTY" |
: |
any of the Parties |
| |
"Products" |
: |
such products bearing trade marks or trade names belonging to NSI or NSE
and/or its Affiliates (whether manufactured and/or sourced by or on behalf of
NSI or NSE and/or its Affiliates) as are made available for sale by NSE’s
Affiliate, NU SKIN ENTERPRISES HONG KONG, INC. with NSI’s or NSE’s
consent pursuant to the Distribution Agreement referred to in Clause
13.11.2(iii) |
| |
"Related Co" |
: |
a related company within the meaning assigned to such
expression by Section 6 of the Cos Act
|
| |
"Ringgit and
"RM" |
: |
the lawful currency of Malaysia |
| |
"Said Business" |
: |
the business of multi-level direct selling/ marketing of
the Products in Malaysia |
| |
"Shareholder's
Undertakings" |
: |
the undertakings substantially in the terms set forth in
"Annexure 1" |
| |
"Shareholding
Proportions" |
: |
the respective proportions (including those set forth in
Clause 4.3) in which NSMH's total issued capital for the
time being is held by the PARTIES from time to time |
| |
"SPA (FK)" |
: |
the sale and purchase agreement for the sale by NSE and the purchase by
XXXXXXX of FK’s Block and includes such variations and modifications
thereto as may be agreed upon in writing between the parties thereto |
| |
"SPA (Nadzmi)" |
: |
the sale and purchase agreement for the sale by NSE and the purchase by
DATO’ NADZMI of Nadzmi’s Block and includes such variations and
modifications thereto as may be agreed upon in writing between the parties
thereto |
| |
"SPA (OBI)" |
: |
the sale and purchase agreement for the sale by NSE and the purchase by the
Other Bumiputera Investor of the 20% Block and includes such variations and
modifications thereto as may be agreed upon in writing between the parties
thereto |
| |
"Subject Shares" |
: |
NSMH Shares subject of an Offer |
| |
"Subsidiary" |
: |
a subsidiary within the meaning assigned to such expression
by Section 5 of the Cos Act |
| |
"20% Block" |
: |
500,001 (Five Hundred Thousand and One) NSMH Shares or
such other number of Ordinary NSMH Shares as is equivalent to 20% (Twenty
Percent) of NSMH’s enlarged issued share capital following the shares
conversion referred to in Recital III(E)(iii)(a) |
| |
"3rd Party Purchaser" |
: |
a person, firm or company who:- |
| |
|
|
|
|
i) |
is not a PARTY and who agrees to purchase or to
subscribe for NSMH Shares; and |
| |
|
|
|
|
|
|
| |
|
|
|
|
ii) |
agrees to deliver Shareholder’s Undertaking to and is consented to (such
consent not to be unreasonably withheld) by such of the PARTIES as shall remain
NSMH Members subsequent to the aforesaid person's, firm's or company's purchase
of or subscription for NSMH Shares |
| |
"Valuers" |
: |
such international accounting firm (but excluding the Auditors unless
otherwise agreed between the Offeror and Offeree) as may be agreed upon between
the Offeror and Offeree or, failing agreement, an international accounting firm
(not being the auditor or accountant of either the Offeror or the Offeree) as
may be recommended by the Auditors |
| |
"VALUERs' Certificate" |
: |
the certificate of the Valuers as to the Certified Value
issued pursuant to Clause 6.4 |
| |
|
1.2.1 |
The Annexures hereto shall
be taken, read and construed as essential parts of this Agreement. The headings
in this Agreement are inserted for convenience of reference only and shall not
be taken, read and construed as essential parts of this Agreement. |
| |
|
1.2.2 |
All references to
Annexures, Recitals and Clauses are to be construed as references to the
annexures, recitals and clauses of this Agreement. All references to provisions
of statutes include such provisions as modified, re-certified or re-enacted. All
references to this Agreement include this Agreement as amended or modified from
time to time by written agreement between the Parties. All references to a
natural person shall include such person’s heirs, personal representatives,
successors-in-title and permitted assigns. All references to a company shall
include such company’s successors-in-title and permitted assigns.
|
| |
|
1.2.3 |
Except where the context
otherwise requires, words applicable to natural persons include any body of
persons, company, corporation, firm or partnership corporate or incorporate and
vice versa; words importing the masculine gender shall include the feminine and
neuter genders and vice versa; words importing the singular number shall include
the plural number and vice versa.
|
| |
|
1.2.4 |
Where two or more persons
or parties are included or comprised in any expression, agreements, covenants,
terms, stipulations and undertakings expressed to be made by or on the part of
such persons shall, unless otherwise provided herein, be deemed to be made by
and be binding upon such persons jointly and severally.
|
| |
|
1.2.5 |
In computing time for the
purposes of this Agreement, unless the contrary intention appears, a period of
days from the happening of an event or the doing of any act or thing shall be
deemed to be exclusive of the day on which the event happens or the act or thing
is done and if the last day of the period is a weekly or public holiday, the
period shall include the next following day which is not a weekly or public
holiday.
|
2.
CONDITIONAL
AGREEMENT
2.1
Conditions Precedent
The provisions of this Agreement (save for the Effective Clauses) are conditional upon:-
|
2.1.1 |
the completion under and in accordance with the provisions of the SPA(FK) of the
sale and purchase of FK’s Block and the entry in NSMH’s Register of
Members of XXXXXXX as the holder of FK’s Block; and |
|
2.1.2 |
the completion under and in accordance with the provisions of the SPA(Nadzmi) of
the sale and purchase of Nadzmi’s Block and the entry in NSMH’s
Register of Members of DATO’ NADZMI as the holder of Nadzmi’s 1st
Block. |
2.2
Non-fulfillment of Condition Precedent
| |
If the SPA(FK) and/or the SPA(Nadzmi) are/is terminated in accordance with the
provisions of (as applicable) SPA(FK) or SPA(Nadzmi), this Agreement shall be
deemed to be of no further effect and the respective obligations of the PARTIES
hereunder shall wholly cease and no PARTY shall have any claim hereunder against
any other PARTY save and except in respect of any antecedent breach of the
Effective Clauses. |
3.
OBJECTIVES,
NSMH’s & NSMY’s M&A AND NSMH’s & NSMY’s Name
3.1
Objectives
|
3.1.1 |
Unless otherwise agreed upon in writing between the PARTIES:- |
|
|
i) |
NSMH shall continue to carry on business as an investment holding company; and |
| |
|
|
|
|
|
ii) |
NSMY shall carry on business as a multi-level direct selling/ marketing company
selling, marketing, distributing and supplying the Products in Malaysia only. |
|
3.1.2 |
The PARTIES shall cause NSMY to use its best endeavours to promote, sell,
market, distribute and supply the Products in Malaysia. |
|
3.1.3 |
Each of the PARTIES shall provide and render to NSMH and NSMY all such support
and assistance as may be necessary and as such PARTY shall be capable of
providing. Save in respect of the charges, licencee fees and/or royalty payable
by NSMY under the Inter-co Agreements, no charges shall be payable by NSMH
and/or NSMY for the support and assistance rendered by such PARTIES unless such
charges shall have been agreed upon in advance in writing between the PARTIES
and also by (as applicable) NSMH and NSMY. |
| |
To enable the PARTIES and (as applicable) NSMH and NSMY to evaluate any proposed
charges, the PARTY providing the support or assistance shall furnish to the
other PARTIES and (as applicable) NSMH and NSMY, full details of the relevant
support and assistance and its cost relating thereto. |
|
3.1.4 |
Without derogating from its obligations under Clause 3.1.3, DATO’ NADZMI
shall use his best endeavours to assist NSMY inter alia in liaising and dealing
with MDTCA on all matters relating to the DS Licence (including the renewal of
such licence) and with all governmental and quasi-governmental authorities and
bodies in Malaysia. |
3.2
M&A of
NSMH & NSMY
|
3.2.1 |
The PARTIES shall cause NSMH and NSMY to adopt memorandum and articles of
association which reflect the provisions of this Agreement. In the event of a
conflict between the provisions of this Agreement and the provisions of the
M&A of (as applicable) NSMH or NSMY, the provisions of this Agreement shall
prevail and the PARTIES shall cause (as applicable) NSMH or NSMY to alter, with
all due speed, the M&A of (as applicable) NSMH or NSMY so as to remove the
conflict. |
3.2
NSMH’s & NSMY’s Name
|
3.2.1 |
The PARTIES acknowledge that NSI and/or its Related Co is the proprietor of the
name “NU SKIN”. Accordingly, NSE (being a Related Co to NSI) shall be
entitled, by written notice to (as applicable) NSMH or NSMY, to require the
exclusion of the name “NU SKIN” from (as applicable) NSMH’s or
NSMY’s corporate name if NSE ceases to hold any NSMH Shares (whether
directly or indirectly). |
|
3.2.2 |
Upon the receipt by (as applicable) NSMH or NSMY of the written notice referred
to in Clause 3.3.1, the PARTIES or such of them as continue to be members of
NSMH shall cause (as applicable) NSMH or NSMY:- |
| |
|
i) |
promptly to do all acts and things to change its corporate name so as to exclude
the name "NU SKIN" from (as applicable) NSMH's or NSMY's name; and |
| |
|
|
|
| |
|
ii) |
to cease thereafter (save as required by statute as to the use by (as
applicable) NSMH or NSMY of its former name for such time as may be statutorily
specified) to use in any manner whatsoever, the name “NU SKIN” as (as
applicable) NSMH’s or NSMY’s corporate name. |
4.
SHARE CAPITAL OF NSMH & NSMY
4.1
Authorised Capital
Subject to Clause 4.4:-
|
4.1.1 |
the authorised share capital of NSMH shall be RM5,000,000.00 (Ringgit
Five Million) divided into divided into 2,500,000 (Two Million and Five
Hundred Thousand) NSMH Shares and 2,500,000 (Two Million and Five Hundred
Thousand) ICPS; and |
|
4.1.2 |
the authorised share capital of NSMY shall be RM5,000,000.00 (Ringgit
Five Million) divided into divided into 5,000,000 (Five Million) NSMY
Shares. |
4.2
Issued and
Paid Up Capital
Subject to Clause 4.4:-
|
4.2.1 |
the initial issued and paid up share capital of NSMH [following completion of
the SPA(FK) and the SPA(Nadzmi)] shall be RM2,500,000.00 (Ringgit Two
Million and Five Hundred Thousand) divided into 500,001 (Five Hundred
Thousand and One) ICPS and 2,000,001 (Two Million and One) NSMH Shares; |
|
4.2.2 |
the issued and paid up share capital of NSMH following completion of the
SPA(OBI) shall be RM2,500,002.00 (Ringgit Two Million Five Hundred
Thousand and Two) divided into 2,500,002 (Two Million Five Hundred
Thousand and Two) NSMH Shares; and |
| |
4.2.3 |
unless required by the DS Act or the DS Guidelines, the issued and paid up share
capital of NSMY shall be RM2,500,002.00 (Ringgit Two Million Five Hundred
Thousand and Two) divided into 2,500,002 (Two Million Five Hundred
Thousand and Two) NSMY Shares. |
4.3
Shareholding Proportions
|
4.3.1 |
Subject to Clause 4.4, the issued share capital of NSMH following completion of
the SPA(FK) and the SPA(Nadzmi) shall be held by the PARTIES in the amounts and
proportions set forth in columns (2) and (3) below opposite the respective names
of the PARTIES set forth in column (1) below:- |
| |
(1) |
(2) |
(3) |
|
| |
Name of PARTY |
Number of NSMH Shares |
Percentage |
|
| |
|
|
|
|
| |
i) NSE |
750,000 |
37.5% |
|
| |
ii) XXXXXXX |
750,000 |
25.0% |
|
| |
iii) DATO' NADZMI |
500,001 |
37.5% |
|
| |
|
|
|
|
| |
TOTAL |
2,000,001 |
100.0% |
|
| |
|
–––––––––– |
–––––––––– |
|
|
4.3.2 |
Subject to Clause 4.4, the issued share capital of NSMH following completion of
the SPA(OBI) shall be held by the PARTIES in the amounts and proportions set
forth in columns (2) and (3) below opposite the respective names of the PARTIES
set forth in column (1) below:- |
| |
(1) |
(2) |
(3) |
|
| |
Name of PARTY |
Number of
NSMH Shares |
Percentage |
|
| |
|
|
|
|
| |
i) NSE |
750,000 |
30.0% |
|
| |
ii) XXXXXXX |
750,000 |
30.0% |
|
| |
iii) DATO' NADZMI |
500,001 |
20.0% |
|
| |
iv) Other
Bumiputera Investor |
500,001 |
20.0% |
|
| |
|
|
|
|
| |
TOTAL |
2,500,002 |
100.0% |
|
| |
|
–––––––––– |
–––––––––– |
|
|
4.3.3 |
Unless the PARTIES otherwise agrees in writing or pursuant to the provisions of
this Agreement, all of the issued share capital of NSMY from time to time shall
be held by NSMH. |
4.4
Increases
of authorised & issued capital
|
4.4.1 |
for the purposes of completion of the SPA(OBI), each of XXXXXXX and DATO’
NADZMI hereby acknowledges and agrees, to the following and undertakes to use
his best endeavours to cause NSMH and NSMY to effect the same:- |
| |
|
i) |
the conversion by NSE of 500,001 (Five Hundred Thousand and One) ICPS held by it
into 500,001 (Five Hundred Thousand and One) NSMH Shares; and |
| |
|
|
|
| |
|
ii) |
upon such conversion the issue at NSE’s request made of NSMH directly to
the Other Bumiputera Investor of 500,001 (Five Hundred Thousand and One)
NSMH Shares constituting the 20% Block. |
|
4.4.2 |
Any increases of the authorised or issued and paid-up capital of NSMH and/or
NSMY in addition to the current (as applicable) authorised or issued and paid up
capital referred to in (as applicable) Clause 4.1 or 4.2 or 4.4.1 shall only be
made in accordance with the provisions of Clause 11.1. |
5.
ISSUE OF NSMH SHARES
5.1
Offers of NSMH Shares
|
5.1.1 |
Each of XXXXXXX and DATO' NADZMI:- |
| |
|
i) |
confirm and acknowledges his awareness that, in view of the equity restrictions
imposed by the MDTCA under the DS Guidelines on foreign participation, NSE is
willing to limit, for the time being, its equity shareholding in NSMH at
30% (Thirty Percent); |
| |
|
|
|
| |
|
ii) |
agrees that if foreign equity participation in NSMH/NSMY exceeding 30%
(Thirty Percent) is permitted by the MDTCA, NSE shall be entitled to subscribe
for such number of additional NSMH Shares at the Certified Value as will,
together with NSMH Shares then held by NSE, not exceed the maximum foreign
equity shareholding permitted in NSMH; and |
| |
|
|
|
| |
|
iii) |
undertakes to cause NSMH to allot and issue such additional NSMH Shares to NSE
for cash payable upon allotment. |
|
5.1.2 |
Subject to Clause 4.4.1 and 5.1.1, NSMH shall not issue any unissued NSMH Shares
or any new NSMH Shares from time to time created in the capital of NSMH (in
accordance with the provisions of this Agreement) without first offering the new
NSMH Shares to NSMH Members in proportion to their Shareholding Proportions. |
|
5.1.3 |
Unless the PARTIES otherwise agree in writing (including the terms of issue
therefor), NSMY shall not issue any unissued NSMY Shares or any new NSMY Shares
from time to time created in the capital of NSMY (in accordance with the
provisions of this Agreement) other than to NSMH. |
5.2
Offer of
unsubscribed shares
| |
Notwithstanding
the provisions of Clauses 4.4.2, 5.1.1 and 5.1.2, if any NSMH Member fails to
subscribe and pay in full for any of the NSMH Shares offered to it on or before
the date specified by NSMH’s Board for such subscription and payment,
NSMH’s Board shall be at liberty to offer the unsubscribed or unpaid NSMH
Shares to the other NSMH Member (or, if there is more than 1 (One) NSMH
Member, in the proportions which the NSMH Shares then held by these other NSMH
Members bear to each other) for acceptance within such time as may be stipulated
by NSMH’s Board. |
6.
RESTRICTIONS ON DEALINGS WITH NSMH SHARES
6.1
Restrictions on transfers & Encumbrances
|
6.1.1 |
NSE shall be entitled (without any approval or consent of the other PARTIES):- |
| |
|
i) |
to sell, transfer, assign or dispose its NSMH Shares to any party subject to its
delivery of Shareholder’s Undertaking so long as NSE’s and its
Affiliate’s total equity interests direct and indirect in NSMH subsequent
to such sale, transfer, assignment or disposal will not be less than 10%
(Ten Percent) of NSMH’s total issued share capital; and |
| |
|
ii) |
to create Encumbrances in any manner whatsoever over the NSMH Shares held by it in favour of any party. |
|
6.1.2 |
Each of XXXXXXX and DATO’ NADZMI shall be entitled (without the approval or
consent of, as applicable, DATO’ NADZMI or XXXXXXX):- |
| |
|
i) |
to sell whether pursuant to the Call Option or otherwise, NSMH Shares to NSE or
its Affiliates or a party nominated by NSE; and |
| |
|
|
|
| |
|
ii) |
to create in favour of NSE or its Affiliates, Encumbrances over the NSMH Shares held by him. |
|
6.1.3 |
Save as provided in Clauses 6.1.1 and 6.1.2, no PARTY shall directly or
indirectly, sell, transfer, assign, dispose of or create any Encumbrance over
its NSMH Shares except in accordance with Clauses 6.2 to 6.10:- |
| |
|
i) |
with the prior written consent of the other PARTIES; or |
| |
|
|
|
| |
|
ii) |
in accordance with the provisions of this Clause 6. |
|
6.1.4 |
For the purposes of Clause 6.1.3, a change in the control (whether at
board/management or at shareholders level) of a NSMH Member being a body
corporate shall be deemed to be a sale or transfer of such NSMH Member’s
NSMH Shares. |
|
6.1.5 |
Notwithstanding the provisions thereof, the provisions of Clause 6.1.4 shall not
apply to NSE or any Affiliate of NSE or a transferee of NSMH Shares transferred
by NSE or its Affiliate. |
6.2
Right of First Offer
|
6.2.1 |
A NSMH Member other than NSE who wishes to sell, transfer, assign or otherwise
dispose of its NSMH Shares shall first make an offer in writing to sell such
NSMH Shares to NSE at a price not exceeding the Fixed Value. |
|
6.2.2 |
Such offer shall remain open for acceptance for at least 30 (Thirty) days
from the date of NSE’s receipt of the written offer and NSE shall be
entitled to nominate its Affiliate and/or third party/parties to acquire the
NSMH Shares from such NSMH Member as shall be the offeror. |
6.3
Subsequent Offer
| |
Subject to Clauses 6.1.1, 6.1.2 and 6.2, a NSMH Member who wishes to sell, transfer,
assign or otherwise dispose of its NSMH Shares shall first make simultaneous
offers in writing to sell the Subject Shares to the other NSMH Member(s)
(including NSE) (and if there are more than 1 (One) other NSMH Member, in
the proportions in which the NSMH Shares held by them bear to each other as at
the date of the Offer). |
| |
The price payable for the NSMH Shares shall be agreed upon between the Offeror and
the Offeree concerned within a period of 30 (Thirty) days from the Offeree's
receipt of the Offer or, failing agreement, the Fixed Value of the NSMH Shares
if it is acceptable to the Offeror. If the Fixed Value is not acceptable to the
Offeror, the Offeree shall have the right to terminate any Offer or agreement
constituted by the Offer as set forth below and elect to continue to hold the
NSMH Shares rather than to sell the NSMH Shares. |
| |
Each Offer shall be deemed to be made upon terms that the Offeror shall be entitled:- |
|
6.3.1 |
to revoke (in accordance with Clause 6.4) an Offer remaining unaccepted or (if
applicable) to terminate the agreement constituted by the Offer and any
acceptance thereof if the Fixed Value of the Subject Shares comprised in any of
the simultaneous Offers is unacceptable to the Offeror who so notifies an
Offeree pursuant to Clause 6.4; and |
|
6.3.2 |
to terminate, pursuant to Clauses 6.6 and 6.7, the agreement constituted by the
Offer and the acceptance thereof if all of the Subject Shares comprised in the
simultaneous Offers made are not sold as a result of:- |
| |
|
i) |
the non-acceptance of any Offer; |
| |
|
|
|
| |
|
ii) |
if applicable, the absence of MDTCA's Approval required for the sale of the
Subject Shares accepted by an Offeree; or |
| |
|
|
|
| |
|
iii) |
the Offeree's failure to complete its purchase of the Subject Shares concerned. |
| |
An Offeror who revokes an Offer or terminates an agreement constituted by an Offer
and any acceptance thereof pursuant to (as applicable) Clauses 6.4, 6.6 or 6.7)
shall continue to hold the NSMH Shares comprised in such Offer and may not sell
them unless he/it first offers them to the other NSMH Members. |
6.4
Valuation
|
6.4.1 |
If the Offeror and the Offeree fail to agree within a period of 30
(Thirty) days from the Offeree's receipt of the Offer on a mutually acceptable
price for the Subject Shares they shall appoint the Valuers to determine and
certify the Certified Value of the Subject Shares as at the date of the Offer
and to issue the Valuer's Certificate to the Offeror and the Offeree concerned. |
|
6.4.2 |
The cost and expense of a valuation of the Subject Shares shall be borne by the
Offeror and the Offeree in equal shares. |
|
6.4.3 |
If the Certified Value is not acceptable to the Offeror, the Offeror shall be
entitled, by written notice to such effect served upon the Offeree(s) concerned
within 7 (Seven) days from the Offeror's receipt of the Valuer's
Certificate:- |
| |
|
i) |
to revoke all or any Offers then remaining unaccepted; and |
| |
|
|
|
| |
|
ii) |
to terminate all or any of the agreements constituted by an Offer and an acceptance of it. |
6.5
Acceptance of Offer
|
6.5.1 |
An acceptance of an Offer (which has not been revoked pursuant to Clause 6.4)
shall be in writing served on the Offeror within 30 (Thirty) days from
the date of the Offeree's receipt of (as applicable):- |
| |
|
i) |
the Offer if the price for the Subject Shares is mutually agreed upon; or |
| |
|
|
|
| |
|
ii) |
the Valuer's Certificate as to the Certified Value of the Subject Shares concerned. |
|
6.5.2 |
In the absence of an acceptance served as aforesaid by the Offeree concerned,
the Offer made to such Offeree shall be deemed to be rejected by such Offeree. |
|
6.5.3 |
An acceptance shall relate to ALL (and not some only) of the Subject Shares
comprised in the Offer and shall be made or deemed to be made subject to the
grant of, if applicable, MTDCA’s Approval to the sale by the Offeror of the
NSMH Shares accepted. |
6.6
Partial acceptances & further offers
|
6.6.1 |
If any of the Subject Shares comprised in the simultaneous Offers (available for
acceptance) are NOT accepted pursuant to Clause 6.5, the Offeror shall make
simultaneous offers to sell such Subject Shares to the Offeree(s) who shall have
accepted the Offers made to them (and, if there are more than 1 (One) of such
Offerees, in the proportions which the nominal value of the NSMH Shares held by
them bear to each other) and at the same price per Subject Share as that
applicable to the Subject Shares already accepted by the Offeree concerned. |
|
6.6.2 |
An acceptance of an offer made pursuant to this Clause 6.6 shall be in writing
and served on the Offeror within 14 (Fourteen) days from the Offeree's
receipt of such offer. In the absence of an acceptance served as aforesaid by
the Offeree concerned, the offer made to such Offeree shall be deemed to be
rejected by such Offeree. |
|
6.6.3 |
If any of the Subject Shares comprised in the simultaneous Offers (available for
acceptance) remain unsold following upon offers made pursuant to this Clause
6.6, further offers of such Subject Shares shall be made in accordance with this
Clause 6.6 by the Offeror to such Offerees as shall have accepted the offers
made pursuant to this Clause 6.6. |
|
6.6.4 |
If any Subject Shares remain unsold following upon such further offers, the
Offeror shall be entitled, at its option, by notice served on all the Offerees
within 14 (Fourteen) days from the date of the Offeror's receipt of the
last of the notices served by the Offerees pursuant to this Clause 6.6:- |
| |
|
i) |
to terminate the agreements for the sale and purchase of such of the Subject
Shares as are accepted AND to continue to hold all or any of the Subject Shares
held by the Offeror; or |
| |
|
|
|
| |
|
ii) |
to proceed with the sale of the Subject Shares as are accepted AND to continue
to hold all or any of the Subject Shares which were not accepted. |
6.7
Completion by PARTIES concerned
|
6.7.1 |
Subject to the grant of the MDTCA’s Approval therefor and any termination
by the Offeror pursuant to Clauses 6.4 or 6.6 of the sale and purchase
agreements for the Subject Shares sold, the sale and transfer of such of the
NSMH Shares as are accepted (whether upon Offers made pursuant to Clause 6.3 or
further offers made pursuant to Clause 6.6) shall be completed simultaneously at
NSMH's registered office (or such other place at the Offeror and Offeree may
agree in writing). |
| |
Completion shall take place upon the expiry of whichever is applicable of the following
periods each commencing from the date of the Offeror's receipt of the notices of
acceptance (or the last of them) served pursuant to (as applicable) Clauses 6.5
or 6.6:- |
| |
|
i) |
if no MTDCA's Approval is required, a period of 30 (Thirty) days; or |
| |
|
|
|
| |
|
ii) |
if MTDCA's Approval is required by the Offeror, a period of 90 (Ninety) days. |
|
6.7.2 |
If the sale and transfer of any of the Subject Shares are not completed as a
result of the absence of MTDCA’s Approval, the Offeror shall be entitled at
its option by notice served on all Offerees:- |
| |
|
i) |
to terminate the agreements for the sale and purchase of such of the Subject
Shares comprised in Offers as are accepted and capable of being completed
AND
to continue to hold, all or any of the NSMH Shares held by the Offeror; or |
| |
|
ii) |
to proceed to complete the sale of the Subject Shares as are capable of being
completed
AND
to continue to hold, all or any of the Subject Shares the
sale and purchase whereof cannot be completed. |
6.8
Completion by NSMH as agent of Offeror
| |
If an Offeror (being bound to do so) fails to complete the sale of such Offeror's
NSMH Shares in accordance with the provisions of Clause 6.7, the following
provisions shall apply:- |
|
6.8.1 |
the PARTY (who is the Offeror) hereby irrevocably
authorises any of NSMH Directors (or a person nominated by NSMH
Directors) as the agent of the Offeror:- |
| |
|
i) |
to execute a transfer of the Offeror's NSMH Shares to the NSMH Member's who
shall have agreed to purchase the same; and |
| |
|
|
|
| |
|
ii) |
to give a good receipt for the sale price of the NSMH Shares so transferred; |
|
6.8.2 |
subject to the payment by the transferee to NSMH of (as applicable) the agreed
price or the Fixed Value for the NSMH Shares transferred, NSMH shall have the
right:- |
| |
|
i) |
to register the transferee as the holder of such NSMH Shares; |
| |
|
|
|
| |
|
ii) |
to cancel the share certificate under which the same were held by the Offeror; and |
| |
|
|
|
| |
|
iii) |
to issue to the transferee, new share certificates therefor whereupon such
transferee shall become in defeasibly entitled thereto; |
|
6.8.3 |
NSMH shall forthwith pay the monies received by NSMH into a separate bank
account held in NSMH's name and (subject to any lien then existing in favour of
NSMH) shall hold such monies in trust for the Offeror; and |
|
6.8.4 |
the Offeror shall be entitled to be paid the said monies by NSMH only upon the
delivery by the Offeror to NSMH of the certificate under which NSMH Shares sold
were formerly held by the Offeror. |
6.9
New Offer
| |
A NSMH Member who fails to sell, transfer or otherwise dispose of such NSMH
Member's NSMH Shares pursuant to Clauses 6.3 to 6.7 or Clause 6.10.2 must make
another Offer to sell the same in accordance with Clauses 6.2 to 6.7 prior to
selling such NSMH Shares to any 3rd Party Purchaser. |
6.10
Sale to 3rd Party Purchaser
|
|
Any sale of Subject Shares to a 3rd Party Purchaser pursuant to Clause 6.9 shall be:- |
|
6.10.1 |
at a price which is not less than the highest price per Subject Share payable to
the Offeror by an Offeree who has served a notice of acceptance pursuant to
Clause 6.5; |
|
6.10.2 |
pursuant to a binding agreement for such sale made no later than 90
(Ninety) days from the date on which the last of the Offers shall be made
pursuant to Clause 6.6; |
|
6.10.3 |
subject to the delivery by the 3rd Party Purchaser to such of the PARTIES as
will continue to be NSMH Members of Shareholder's Undertaking and if such 3rd
Party Purchaser is a company, satisfactory evidence that it is duly authorised
to enter into such agreement; and |
|
6.10.4 |
subject to the provisions of Clauses 6.3.2(ii) and 6.3.2(iii). |
7.
CALL OPTION OVER NSMH SHARES HELD BY PARTIES OTHER THAN NSE
7.1
Grant of Call Option
| |
In consideration of NSE entering or having entered into this Agreement at inter
alia the request of XXXXXXX and DATO’ NADZMI, each of XXXXXXX and
DATO’ NADZMI hereby grants to NSE and NSE shall have an option to require
(as applicable) XXXXXXX and DATO’ NADZMI to sell to NSE, its Affiliate or a
party nominated by NSE, at any time, all or any part of the NSMH Shares held by
(as applicable) XXXXXXX and DATO’ NADZMI from time to time upon the terms
and subject to the conditions contained herein. |
7.2
Exercise of Call Option
|
7.2.1 |
The Call Option shall be exercisable by NSE by written notice (substantially in
the form annexed to this Agreement and marked “Annexure 2”)
served on (as applicable) XXXXXXX or DATO’ NADZMI at any time following the
occurrence of any of the following events:- |
| |
|
i) |
where a PARTY is an individual, such PARTY dies, becomes of unsound mind or is incapacitated; or |
| |
|
ii) |
where such PARTY is a body corporate, a change in the control (whether at management or at shareholdings
level) of such body corporate; or |
| |
|
|
|
| |
|
iii) |
an Event of Default; or |
| |
|
|
|
| |
|
iv) |
a PARTY commits a material criminal act or any other act which creates, in the
opinion of NSMH's Board, negative publicity or badwill for NSMH or NSMY;
or |
| |
|
|
|
| |
|
v) |
NSMY fails to obtain a renewal of the validity period of the DS Licence or its
DS Licence is revoked, suspended or cancelled for any reason whatsoever or
NSMY’s ability to conduct its business in accordance with NSE’s global
marketing practices is materially and adversely affected by a change of
applicable laws; or |
| |
|
|
|
| |
|
vi) |
NSMH or NSMY fail to agree with NSE or its Affiliate upon any terms of the
contractual relationships (including those under Inter-co Agreements) between
them; or |
| |
|
|
|
| |
|
vii) |
the PARTIES are at a deadlock (as described in Clause 10.4); or |
| |
|
|
|
| |
|
viii) |
(as applicable) XXXXXXX or DATO’ NADZMI is unable, in all good faith, to
agree to the terms of the new Shareholders Agreement referred to in Clause 16.4. |
|
7.2.2 |
Each NSMH Share sold by (as applicable) XXXXXXX or DATO’ NADZMI pursuant to
Clause 7 shall be sold by him:- |
| |
|
i) |
at the LOWER of the following 2 (Two) prices:- |
|
| |
|
|
|
|
| |
|
|
a) |
a price equivalent to the Certified Value thereof established by the Valuers who
shall be requested by the PARTIES concerned (namely NSE and, as applicable,
XXXXXXX and/or DATO’ NADZMI) to establish and certify (at the cost of such
PARTIES) with all due speed following the exercise by NSE of the Call Option,
the Certified Value of the NSMH Shares; and
|
| |
|
|
|
|
| |
|
|
b) |
the Minimum Amount divided
by the total number of NSMH Shares held by (as applicable) XXXXXXX or DATO
NADZMI;
|
| |
|
|
|
|
| |
|
ii) |
if applicable, subject to the grant of MTDCA's Approval for the sale of NSMH Shares; and |
|
| |
|
|
|
|
| |
|
iii) |
free from all Encumbrances and with all dividends and other distributions paid
or distributed in respect thereof subsequent to completion of the sale and
purchase of such NSMH Shares. |
|
|
7.2.3 |
The cost and expense of a valuation of NSMH Shares under Clause 7.2.2 shall be
borne by the parties concerned in equal shares. |
|
7.2.4 |
Failure by NSE to exercise the Call Option following the occurrence of a
Deadlock shall not prevent NSE from exercising the Call Option following the
occurrence of a subsequent deadlock (as described in Clause 10.4). |
|
7.2.5 |
All pre-emptive rights held by all other PARTIES pursuant to this Agreement in
respect of NSMH Shares comprised in the Call Notice shall be deemed to be waived
and such PARTIES shall, upon request by NSE, confirm such waiver in writing to
NSMH and/or such party as NSE nominates. |
|
7.2.6 |
Notwithstanding the provisions of Xxxxxx 0, xxxx of the restrictions therein set
forth shall be applicable to the sale to NSE pursuant to Clause 7.1 of NSMH
Shares held by (as applicable) XXXXXXX or DATO’ NADZMI. |
7.3
Date for completion
| |
Subject to the grant of MTDCA’s Approval within 90 (Ninety) days from the
date of the Call Notice, completion of the purchase by NSE of the NSMH Shares
comprised in the Call Notice shall take place (unless the PARTIES thereto
otherwise agree in writing) at 12:00 noon on the 14th (Fourteenth) day
following whichever is the later of:- |
|
7.3.1 |
the receipt by both NSE and (as applicable) XXXXXXX and/or DATO’ NADZMI of
the Valuers’ Certificate of the Certified Value of such NSMH Shares; and |
|
7.3.2 |
the receipt by NSE of MTDCA's Approval. |
7.4
Completion
| |
Upon completion of the sale by (as applicable) XXXXXXX and/or DATO’ NADZMI and
the purchase by NSE of the NSMH Shares held by (as applicable) XXXXXXX or
DATO’ NADZMI:- |
|
7.4.1 |
NSE shall pay to (as applicable) XXXXXXX and/or DATO’ NADZMI (by such mode
of payment as NSE stipulates), the price for the NSMH Shares; and |
|
7.4.2 |
(as applicable) XXXXXXX and/or DATO' NADZMI shall deliver to NSE:- |
| |
|
i) |
the share certificates to and unstamped forms of transfer (duly executed by (as
applicable) XXXXXXX or DATO' NADZMI as transferor) of the NSMH Shares;
and |
| |
|
|
|
| |
|
ii) |
if applicable, letters of the resignation as director(s) of NSMH and NSMY signed
by (as applicable) XXXXXXX and/or DATO’ NADZMI and his
representatives/nominees on NSMH’s Board. |
8.
BOARD OF DIRECTORS
8.1
Nominations
|
8.1.1 |
There shall be no fewer than 6 (Six) and no more than 12 (Twelve)
(as applicable) Directors of each of NSMH and NSMY. The initial number of
Directors of NSMH and NSMY shall be 7 (Seven). The number of Directors
may not be increased without NSE’s prior written approval. |
|
8.1.2 |
Subject to applicable laws, the Board of each of NSMH and NSMY shall be
constituted as nearly as may be possible, by persons appointed in accordance
with this Agreement by the PARTIES (or, if applicable, their respective
Subsidiaries or Related Cos) in the Shareholding Proportions. |
|
8.1.3 |
Each NSMH Member shall be entitled to appoint 1 (One) NSMH Director and
1 (One) NSMY Director so long as such NSMH Member holds (whether by
itself or, in the case of NSE, through, as applicable, its Affiliate) not less
than 15% (Fifteen Percent) of the total issued capital of NSMH from time
to time. |
|
8.1.4 |
So long as the relevant PARTIES hold the total issued capital of NSMH in the
Shareholding Proportions stated in Clause 4.3 in accordance with this
Agreement:- |
| |
|
i) |
2 (Two) NSMH Directors and 2 (Two) NSMY Directors shall be appointed by NSE; |
| |
|
|
|
| |
|
ii) |
2 (Two) NSMH Directors and 2 (Two) NSMY Directors shall be appointed by XXXXXXX; |
| |
|
|
|
| |
|
iii) |
1 (One) NSMH Director and 1 (One) NSMY Director shall be appointed by DATO' NADZMI; and |
| |
|
|
|
| |
|
iv) |
such other persons as the PARTIES may agree upon may be appointed as additional
NSMH Directors or NSMY Directors by (as applicable) NSMH’s Board or
NSMY’s Board. |
|
8.1.5 |
The non-executive Chairman of NSMY’s Board shall be such NSMY Director as
shall be nominated and selected by NSE (for approval by NSMY’s Board) from
time to time. If NSMY’s Board so approves, the initial non-executive
Chairman of NSMY’s Board to be so nominated and selected by NSE shall be
DATO’ NADZMI. |
| |
A non-executive Chairman shall cease to hold such office if NSE so requires and
his holding of such office shall be conditioned upon his agreement to such
cesser. |
|
8.1.6 |
The MD of NSMY shall be such NSMY Director appointed by NSE as NSE selects. |
| |
|
|
|
8.1.7 |
The Chief Financial Officer/Controller of NSMY shall be such person(s) as
appointed by NSE as NSE selects. |
|
8.1.8 |
NSE and/or its Related Co as the grantor to NSMY of the licence to use the
marketing plans and/or distributor force therein described shall be entitled to
appoint 1 (One) NSMH Director and 1 (One) NSMY Director. The
Directors appointed by NSE pursuant to this Clause 8.1.8 shall be in addition to
the NSMH Directors and NSMY Directors appointed pursuant to Clause 8.1.4(i). |
|
8.1.9 |
Save for the appointment by (as applicable) XXXXXXX or DATO’ NADZMI of (as
applicable) XXXXXXX or DATO’ NADZMI as Directors of NSMH or NSMY, the
appointment of persons whom (as applicable) XXXXXXX or DATO’ NADZMI selects
for appointment as Directors of NSMH or NSMY shall be subject to the prior
written approval of NSE. |
8.2
Appointments & Removals
|
8.2.1 |
A NSMH Member entitled to appoint a NSMH Director and NSMY Director shall be entitled:- |
| |
|
i) |
to appoint an alternate director to (as applicable) such NSMH Director or NSMY Director; |
| |
|
|
|
| |
|
ii) |
to determine the period (as applicable) such NSMH Director or NSMY Director and his alternate director
shall hold office; |
| |
|
|
|
| |
|
iii) |
to fill any casual vacancy arising from (as applicable) such NSMH Director or
NSMY Director or his alternate director vacating his office; and |
| |
|
|
|
| |
|
iv) |
to remove such NSMH Director or NSMY Director or his alternate director from
office and to appoint another in his place. |
|
8.2.2 |
Any such appointment, determination and removal shall be by notice in writing to
(as applicable) NSMH or NSMY and such notice shall (subject to the provisions of
the Cos Act) take effect when it is delivered to the registered office of (as
applicable) NSMH or NSMY. |
|
8.2.3 |
The NSMH Member appointing and removing a NSMH Director or NSMY
Director/alternate director shall indemnify and save harmless (as applicable)
NSMH or NSMY from all claims (if any) by the NSMH Director or NSMY Director or
their respective alternate directors appointed or removed and resulting from the
appointment or removal. |
|
8.2.4 |
NSE shall be entitled to remove the MD or Chief Operating Officer/Controller of
NSMY from such office and to appoint another person in his place and provision
for termination of the MD’s or Chief Operating Officer/Controller’s
engagement upon such removal shall be a condition of (as applicable) the
MD’s or the Chief Operating Officer’s/Controller’s engagement. |
8.3
Resignations
|
8.3.1 |
If in pursuance of Clauses 8.1 and 8.2, a purchaser of NSMH Shares shall be
entitled to nominate a number of NSMH Directors or NSMY Directors, then
simultaneously with the completion of the sale of the NSMH Shares concerned, the
PARTY who is the seller thereof shall:- |
| |
|
i) |
cause such number
of the persons as shall have been nominated by such PARTY to hold office as NSMH
Directors and NSMY Directors (and as shall be equivalent to the number of NSMH
Directors or NSMY Directors which the aforesaid purchaser is entitled to
appoint):- |
|
| |
|
|
|
|
| |
|
|
a) |
to resign from such office; and
|
| |
|
|
|
|
| |
|
|
b) |
to disclaim
unconditionally and in writing, all rights (if any) to such monies as may be
payable by NSMH or NSMY to such person(s) by way of compensation for loss of
office; and
|
| |
|
|
|
|
| |
|
ii) |
remove the aforesaid persons from office as NSMH Directors and NSMY Directors if
they do not resign from such office as aforesaid or give the aforesaid
disclaimer. |
|
|
8.3.2 |
The PARTIES (other than the PARTY who is the seller of the NSMH Shares) shall
agree to the nomination by the acquirer (of the NSMH Shares hereinbefore
referred to) of a NSMH Director and NSMY Director in the place of each NSMH
Director and NSMY Director who resigns or is removed pursuant to the foregoing
provisions of this Clause 8.3. |
8.4
No rotation or removal by NSMH and NSMY
|
8.4.1 |
The NSMH Directors and NSMY Directors shall not be required to retire by
rotation nor shall they be removed by (as applicable) NSMH or NSMY. |
|
8.4.2 |
Any removal of any NSMH Director or NSMY Director may be effected only by the
NSMH Member who appointed the NSMH Director or NSMY Director concerned. |
8.5
No shareholding qualification
|
|
There shall not be any shareholding qualification for the holding of the office of a
NSMH Director or NSMY Director. |
9.
DIRECTORS’ MEETINGS
9.1
Meetings of NSMH’s Board or NSMY’s Board
|
9.1.1 |
Meetings of NSMH’s Board and of NSMY’s Board shall be convened and
held at regular intervals and at least 2 (Two) times in each of (as
applicable) NSMH’s or NSMY’s Financial Year. |
|
9.1.2 |
In addition to such meetings of NSMH’s Board or NSMY’s Board as may be
convened by order of (as applicable) NSMH’s Board or NSMY’s Board,
NSMH’s or NSMY’s company secretary (as the case may be) shall, upon
being directed so to do by any 2 (Two) (as applicable) NSMH Directors or
NSMY Directors, give notice of a meeting of (as applicable) NSMH’s Board or
NSMY’s Board and any 2 (Two) (as applicable) NSMH Directors or NSMY
Directors may themselves give such notice. |
|
9.1.3 |
Non-executive NSMH Directors and non-executive NSMY Directors (or their
respective alternates) shall be paid only such fees, expenses or other
remuneration as the Board may approve as a Key Issue (Board) or, in the case of
the non-executive Chairman, as determined pursuant to Clause 12.2. |
|
9.1.4 |
The remuneration payable and benefits accorded to NSMY’s MD and Chief
Financial Officer/Controller from time to time shall be approved by NSMY’s
Board as a Key Issue and they shall also be reimbursed all such costs and
expenses (including traveling, accommodation and other out-of-pocket expenses)
as they may properly incur in the discharge of their respective
functions/responsibilities. |
9.2
Notice of
Board meetings
|
9.2.1 |
A meeting of (as applicable) NSMH’s Board and NSMY’s Board shall be
called by notice in writing served on all of (as applicable) NSMH Directors or
NSMY Directors. Unless the majority of (as applicable) NSMH Directors or NSMY
Directors including those nominated by NSE otherwise agrees in writing, not less
than 7 (Seven) days notice (exclusive of the date of the notice and the
date of the meeting concerned) shall be given of a meeting of NSMH’s Board
or of NSMY’s Board. |
|
9.2.2 |
Each notice of a meeting of NSMH's Board or NSMY's Board shall be:- |
| |
|
i) |
accompanied by an agenda specifying in reasonable detail, all the business to be
transacted thereat and all relevant papers for consideration or discussion;
and |
| |
|
|
|
| |
|
ii) |
sent (as applicable) to all of the NSMH Directors or the NSMY Directors by hand,
courier or telefax (with copy by hand, courier or certified mail being airmail
in the case of NSMH Directors or NSMY Directors who are not resident in
Malaysia. |
9.3
Quorum
|
9.3.1 |
The quorum for all meetings of (as applicable) NSMH’s Board and NSMY’s
Board (other than an adjourned meeting) shall be 2 (Two) (as applicable)
NSMH Directors or NSMY Directors (or their duly appointed alternate directors)
including a Director (or his alternate) nominated by NSE. |
|
9.3.2 |
If such a quorum is not present at any meeting of (as applicable) NSMH’s
Board or NSMY’s Board within half-an-hour of the time appointed for the
meeting, then (unless the majority of the Directors including a Director
nominated by NSE otherwise agrees in writing) such meeting shall stand adjourned
to the same day in the following week, at the same time and place as the initial
meeting. A notice of the adjourned meeting shall be sent by hand, courier or
telefax (with copy by hand, courier or certified mail being airmail in the case
of NSMH Directors or NSMY Directors who are not resident in Malaysia). |
|
9.3.3 |
If, at the adjourned meeting, a quorum is not present within half an hour from
the time appointed for the adjourned meeting, any 2 (Two) (as applicable)
NSMH Directors or NSMY Directors (or their alternates) present shall constitute
a quorum. |
|
9.3.4 |
For the purposes of Clauses 9.3.1, 9.3.2 and 9.3.3, a NSMH Director or NSMY
Director who is in continuous communication and can hear and be heard by means of
a conference telephonic or video connection with (as applicable) the NSMH
Directors or the NSMY Directors present at a meeting of (as applicable)
NSMH’s Board or NSMY’s Board shall be deemed to be present at such
meeting. |
|
9.3.5 |
Unless otherwise agreed to by the majority of (as applicable) NSMH Directors or
NSMY Directors (including a Director nominated by NSE) at any meeting at which
the quorum specified in Clause 9.3.1 is present, no resolution relating to any
business may be proposed or passed at any meeting of (as applicable) NSMH’s
Board or NSMY’s Board unless the nature of the business for such meeting is
specified in the agenda sent together with the notice convening the meeting. |
|
9.3.6 |
At any adjourned meeting of NSMH’s Board or NSMY’s Board, only matters
specified in the notice of the initial meeting of (as applicable) NSMH’s
Board or NSMY’s Board may be decided. |
9.4
Chairman of Board meetings
| |
The Chairman of (as applicable) NSMH’s Board or NSMY’s Board shall be the
chairman of all meetings of (as applicable) NSMH Directors or NSMY Directors. In
the absence of the Chairman within 15 (Fifteen) minutes after the time
appointed for the holding of the meeting or if he is unwilling to act, any (as
applicable) NSMH Director or NSMY Director present may be appointed to act as
chairman of the meeting by the others of (as applicable) the NSMH Directors or
NSMY Directors present at the meeting. |
9.5
Key Issues (Board)
| |
A resolution of NSMH’s Board and NSMY’s Board on any of the following
matters shall be valid only if passed by an affirmative vote of a simple
majority of (as applicable) NSMH Directors or NSMY Directors present and voting
including an affirmative vote of at least 1 (One) (as applicable) NSMH
Director or NSMY Director nominated by NSE:- |
|
9.5.1 |
the approval of the Annual Business Plan (if any) and any variation to or departure from such Annual Business Plan; |
|
9.5.2 |
recommendation on declaration/payment of dividends or redemption of shares; |
|
9.5.3 |
save for the implementation of the Annual Business Plan (if any):-
|
| |
|
i) |
any borrowing or incurrence of indebtedness or forgiving of indebtedness by NSMH
or NSMY or the lending of (as applicable) NSMH's or NSMY's funds; or |
| |
|
|
|
| |
|
ii) |
any creation of any Encumbrance over the assets of (as applicable) NSMH or NSMY; or |
| |
|
|
|
| |
|
iii) |
the giving of guarantee of any payments or performance of any debt or obligation of third parties and/or
any NSMH Member; |
|
9.5.4 |
any factoring or assignment of any of NSMH's or NSMY's book debts;
|
|
9.5.5 |
save as approved by (as applicable) NSMH’s Board or NSMY’s Board upon
its approval of the Annual Business Plan (if any), acquisition of any business,
any merger, joint venture or similar corporate transaction;
|
|
9.5.6 |
save as approved by (as applicable) NSMH’s Board or NSMY’s Board upon
its approval of the Annual Business Plan (if any) and subject to Clause 9.5.5,
any capital expenditure or investment or the sale or disposal of any part of the
business, undertaking, property or assets of (as applicable) NSMH or NSMY
involving a sum exceeding RM100,000.00 (Ringgit One Hundred Thousand);
|
|
9.5.7 |
other than in implementation of an Annual Business Plan (if any), the entry by
(as applicable) NSMH or NSMY into any lease (either as lessor or lessee) of any
property, plant or equipment involving the payment of annual rentals in excess
of RM10,000.00 (Ringgit Ten Thousand);
|
|
9.5.8 |
save for the entry by NSMY into the Inter-co Agreements, the award or entry by
(as applicable) NSMH or NSMY (in any Financial Year) of and into any contract
for the sourcing or supply of goods, materials and/or equipment and/or the
provision of services;
|
|
9.5.9 |
save for the entry by NSMY into the Inter-co Agreements, the entry by (as
applicable) NSMH or NSMY into any licensing or other agreement involving the
acquisition or disposal or the grant or receipt of rights to use and/or acquire
technical know-how (whether patented or unpatented) or any other manufacturing
technology, patents, trademarks or other industrial property;
|
|
9.5.10 |
other than in the ordinary course of business (the routine collection of debts
being an example) or in the implementation of the Annual Business Plan, if any
or except where advice is given to (as applicable) NSMH or NSMY that the defence
of an action must be undertaken by (as applicable) NSMH or NSMY on an urgent
basis or that application for injunctive relief or other interim order for
preservation must be made by (as applicable) NSMH or NSMY, the commencement of
any litigation or arbitration proceedings or the settlement, abandonment or
compromise of any litigation, arbitration or governmental proceedings of any
claim by or against (as applicable) NSMH or NSMY;
|
|
9.5.11 |
the appointment, dismissal and/or variation of the terms of employment of any of
(as applicable) NSMH’s or NSMY’s executives or senior employees whose
annual gross remuneration (calculated by reference to his salary, fixed monthly
allowances or other payments and the amount of the contribution paid by (as
applicable) NSMH or NSMY as his employer to the Employees Provident Fund)
exceeds RM100,000.00 (Ringgit One Hundred Thousand);
|
|
9.5.12 |
the adoption, variation or modification of any employees' compensation structure, benefit or retirement plans;
|
|
9.5.13 |
the fees, remuneration, emoluments and other benefits to be paid or accorded to
NSMY’s Managing Director and Chief Financial Officer/Controller, all others
of (as applicable) NSMH Directors or NSMY Directors and (as applicable)
NSMH’s or NSMY’s other key management personnel;
|
|
9.5.14 |
the extent and any variation of the powers delegated by NSMY's Board to NSMY's MD;
|
|
9.5.15 |
the entry into any agreement or arrangement not in the ordinary course of
business and/or which cannot be terminated without penalty within 12
(Twelve) months from its commencement date;
|
|
9.5.16 |
make any sponsorship or political or charitable gift or donation;
|
|
9.5.17 |
the conduct by NSMH of any business other than the holding of NSMY Shares or the conduct by NSMY of any business
other than the DS Business;
|
|
9.5.18 |
the termination of any agreements or arrangements entered into with NSE and/or
Related Co, including the Inter-co Agreements;
|
|
9.5.19 |
approval of persons nominated by the relevant PARTIES in accordance with the
provisions of this Agreement to hold office as (as applicable) NSMH Directors or
NSMY Directors and/or alternate directors;
|
|
9.5.20 |
all decisions concerning and all relationships with distributors of the Products
all matters involving the compensation plan and all contracts, arrangements and
relationship with distributors of the Products;
|
|
9.5.21 |
the sale of Products other than through NSE's or its Related Co's distributor force;
|
|
9.5.22 |
NSMH's or NSMY's entry into and termination of any material contracts;
|
|
9.5.23 |
resolution of any tax or regulatory issues;
|
|
9.5.24 |
the establishment of any branch or representative office of (as applicable) NSMH or NSMY; and
|
|
9.5.25 |
any of the following matters in relation to NSMY as a wholly owned subsidiary of NSMH:-
|
| |
|
i) |
any reduction or other alteration in the authorised share capital of NSMY, the
creation or issue of any NSMY Shares or other securities in NSMY, the making of
calls on NSMY Shares, the grant of any option or right to subscribe for any
shares in NSMY, the forfeiture or redemption of NSMY Shares or other securities
in NSMY or any resolution altering the classification of NSMY Shares or other
securities in NSMY or any rights pertaining thereto; |
| |
|
|
|
| |
|
ii) |
unless NSMY is insolvent or pursuant to Clause 15.2.3, the passing of any resolution for the winding-up of
NSMY; |
| |
|
|
|
| |
|
iii) |
NSMY’s enter into any partnership or joint venture with any other person or
NSMY’s making or entry into any proposal for the reconstruction,
reorganisation, amalgamation, merger or consolidation of NSMY with any other
company or corporation; |
| |
|
|
|
| |
|
iv) |
a change in the corporate name of NSMY; |
| |
|
v) |
save pursuant to Clause 13.2.2, the appointment or the removal of NSMY's Auditors; |
| |
|
|
|
| |
|
vi) |
the payment of any dividend or the making of any other distribution by NSMY or
the capitalisation of NSMY's profits; |
| |
|
|
|
| |
|
vii) |
save pursuant to Clause 14, the disposal of the whole or a material part of the
undertaking, property or assets of NSMY; |
| |
|
|
|
| |
|
viii) |
notwithstanding the powers contained in the objects clause of NSMY’s
Memorandum of Association, the undertaking or participation by NSMY of and in
activities other than the DS Business including NSMY’s entry into any
transaction which is not in the ordinary course of NSMY’s DS Business; |
| |
|
|
|
| |
|
ix) |
the amendment of NSMY's M & A; |
| |
|
|
|
| |
|
xi) |
the listing of NSMY; and |
| |
|
|
|
| |
|
xii) |
the establishment of a Subsidiary of NSMY, the issue of shares in such
Subsidiary, any transaction resulting in the loss of control of or dilution of
NSMY’s interest in such Subsidiary and the dissolution of such Subsidiary. |
9.6
Voting
|
9.6.1 |
Save in respect of a Key Issue (Board) or a Key Issue (Members) (and subject to
any other provision of this Agreement which, expressly or by implication,
requires the approval or agreement of one or more or all of (as applicable) NSMH
Members or NSMY Members in respect of any particular matter) a resolution of (as
applicable) NSMH’s Board or NSMY’s Board at a meeting of (as
applicable) NSMH Directors or NSMY Directors is valid if passed by an
affirmative vote of a simple majority of (as applicable) NSMH Directors or NSMY
Directors present and voting. |
|
9.6.2 |
The Chairman of (as applicable) NSMH’s Board or NSMY’s Board shall NOT
have a second or casting vote in the case of an equality of votes in a meeting
of (as applicable) NSMH’s Board or NSMY’s Board. |
|
9.6.3 |
(As applicable) a NSMH Director or NSMY Director who is in continuous
communication and can hear and be heard by means of a conference telephone or
video connection with (as applicable) the NSMH Directors or NSMY Directors
present at a meeting of (as applicable) NSMH’s Board or NSMY’s Board
may vote at such meeting and his vote shall be counted. |
|
9.6.4 |
Unless prohibited by applicable laws, a NSMH Director or a NSMY Director
nominated by NSE shall not be precluded from voting on any matter, contract,
arrangements and/or transactions with, relating to or in connection with NSE
and/or its Affiliates merely by virtue of his being an employee, officer,
servant or shareholder of NSE and/or its Subsidiaries and/or its Related Co. |
9.7
Directors' resolutions in writing
|
9.7.1 |
A resolution in writing signed by the majority of (as applicable) NSMH Directors
or NSMY Directors (including a Director nominated by NSE) shall be as valid and
effectual as if it had been passed at a meeting of (as applicable) NSMH’s
Board or NSMY’s Board duly convened and held. |
|
9.7.2 |
Any such resolution in writing may be contained in one document or separate
copies thereof (prepared and circulated by telefax with copy sent by hand,
courier or certified mail being airmail in the case of a NSMH Director or NSMY
Director who is not resident in Malaysia) which is signed by one or more of (as
applicable) NSMH Directors or NSMY Directors. |
| |
An approval by letter or other written means of a proposed resolution in writing
(which has been prepared and circulated as aforesaid) signed by a (as
applicable) NSMH Director or NSMY Director and sent by him by telefax (with copy
sent by hand, courier or certified mail being airmail in the case of a NSMH
Director or NSMY Director who is not resident in Malaysia) shall be deemed to be
a document signed by him for the purposes of the foregoing provisions. |
|
9.7.3 |
Where 2 (Two) or more documents or copies of a document are prepared and
circulated for the purpose of obtaining signatures, each of such documents or
copies shall be certified in advance by (as applicable) NSMH’s company
secretary or NSMY’s company secretary as a true copy of the proposed
resolution in writing. |
9.8
Exemption of Directors from personal liability
| |
Save for losses, damages and expenses incurred as a result of an act of bad faith or
wilfull misconduct, a NSMH Director or NSMY Director or other officer of (as
applicable) NSMH or NSMY shall not be liable for any losses, damages and
expenses incurred by (as applicable) NSMH or NSMY as a result of (as applicable)
such Director’s or other officer’s own wrongful act, omission or
negligence or as a result of the execution or implementation by (as applicable)
such Director or other officer of the directions and policies of (as applicable)
NSMH’s Board or NSMY’s Board. |
10.
GENERAL MEETINGS
10.1
Quorum
|
10.1.1 |
The quorum necessary for the transaction of business at a General Meeting of
NSMH shall be 2 (Two) NSMH Members (including NSE) present (as
applicable) in person or by their corporate representatives or proxies. |
|
10.1.2 |
If within half-an-hour from the time appointed for the holding of a General
Meeting, a quorum as aforesaid is not present, the meeting shall stand adjourned
to the same day in the next week at the same time and place. A notice of the
adjourned meeting shall be given to all NSMH Members. |
|
10.1.3 |
If at the adjourned meeting a quorum as aforesaid is not present within
half-an-hour from the time appointed for holding the meeting, any 2 (Two)
NSMH Members present shall be a quorum. |
10.2
Voting
|
10.2.1 |
Except for Key Issues (Members), matters arising at a General Meeting of NSMH
shall be decided, whether on a show of hands or upon a poll, by a vote of a
simple majority of NSMH Members present and voting. |
|
10.2.2 |
The Chairman shall NOT have a second or casting vote in the case of an equality
of votes in a General Meeting of NSMY. |
|
10.2.3 |
The corporate representative or proxy for all general meetings of NSMY shall be
nominated by NSE for appointment by NSMH. |
10.3
Shareholders’ resolution in writing
|
10.3.1 |
A resolution in writing of NSMH Members shall be valid and effectual as if it
had been passed at a General Meeting of NSMH Members duly convened and held if
the same is signed by a majority of NSMH Members including NSE. |
|
10.3.2 |
A resolution in writing of NSMY’s Members shall be valid and effectual as
if it had been passed at a General Meeting of NSMY’s Members duly convened
and held if the same is signed by the duly authorised corporate representative
of NSMH. |
|
10.3.3 |
Any such resolution in writing may be contained in one document or separate
copies thereof (prepared and circulated by telefax with copy sent by courier or
registered post) which is signed by one or more of (as applicable) NSMH Members
or NSMY Members. An approval by letter or other written means of a proposed
resolution in writing (which has been prepared and circulated as aforesaid)
signed by (as applicable) a NSMH’s or NSMY’s Member and sent by him by
telefax (with copy sent by courier or registered post) shall be deemed to be a
document signed by him for the purposes of the foregoing provisions. |
|
10.3.4 |
Where 2 (Two) or more documents or copies of a document are prepared and
circulated for the purpose of obtaining signatures, each of such documents in
copies shall be certified in advance by the company secretary of (as applicable)
NSMH or NSMY as a true copy of the proposed resolution in writing. |
10.4
Deadlock
|
10.4.1 |
A deadlock shall be deemed to occur if the PARTIES or (as applicable) NSMH
Directors or NSMY Directors are unable to agree upon Key Issue (Members) or Key
Issues (Board), as the case may be, and a resolution on the same is not passed
after the decision on the relevant Key Issue shall have been referred to NSMH
Members at 2 (Two) General Meetings held at intervals of not less than
30 (Thirty) days. |
|
10.4.2 |
A deadlock may be referred by either PARTY to arbitration pursuant to Clause 24. |
11.
KEY ISSUES (MEMBERS)
Without
prejudice to any other matters referred to in this Agreement which expressly or
by implication require the written approval of all of NSMH Members, any of the
following matters may be undertaken by NSMH only with the prior approval of NSE
as a member of NSMH, such approval to be given where required by applicable
laws, at a General Meeting of NSMH or by a shareholders resolution in writing:-
| 11.1 |
any reduction or other alteration in the authorised share capital of NSMH, the
creation or issue of any NSMH Shares or other securities in NSMH, the making of
calls on NSMH Shares, the grant of any option or right to subscribe for any
shares in NSMH, the forfeiture or redemption of NSMH Shares or other securities
in NSMH or any resolution altering the classification of NSMH Shares or other
securities in NSMH or any rights pertaining thereto; |
| 11.2 |
unless NSMH is insolvent or pursuant to Clause 15.2.3, the passing of any
resolution for the winding-up of (as applicable) NSMH or its Subsidiary
(including NSMY); |
| 11.3 |
enter into any partnership or joint venture with any other person or make or
enter into any proposal for the reconstruction, reorganisation, amalgamation,
merger or consolidation of NSMH with any other company or corporation; |
| 11.4 |
a change in the name of NSMH; |
| 11.5 |
save pursuant to Clause 13.2.2, the appointment or the removal of NSMH's Auditors; |
| 11.6 |
the payment of any dividend or the making of any other distribution by NSMH or the capitalisation of NSMH's profits; |
| 11.7 |
the disposal of the whole or a material part of the undertaking, property or assets of NSMH; |
| 11.8 |
notwithstanding the powers contained in the objects clause of NSMH’s
Memorandum of Association, any engagement by NSMH in activities other than as an
investment holding company including the entry into any transaction not in the
ordinary course of NSMH’s business; |
| 11.9 |
the amendment of NSMH's M & A; |
| 11.10 |
the conversion of NSMH from a private to a public company; |
| 11.11 |
the listing of NSMH; |
| 11.12 |
the establishment of a Subsidiary of NSMH, the issue of shares in such
Subsidiary, any transaction resulting in the loss of control of or dilution of
NSMH’s interest in such Subsidiary and the dissolution of such Subsidiary;
and |
| 11.13 |
any of the Key Issues (Board) which any 2 (Two) of (as applicable) the NSMH
Directors or the NSMY Directors refer to NSMH Members for decision as a Key
Issue (Members). |
12.
MANAGEMENT OF NSMY & NSMY’s CHAIRMAN
12.1
Management of NSMY
|
12.1.1 |
NSMY’s MD shall be such NSMY Director nominated and selected by NSE and as
may be acceptable to NSMY’s Board. |
|
12.1.2 |
NSMY’s Board shall delegate to NSMY’s MD, such powers, authorities and
discretion as may be necessary or expedient for NSMY’s MD to discharge his
duties for the overall supervision, control and day-to-day management of NSMY
and his responsibility for the day to day coordination of the activities of NSMY
and its observance and performance of the terms and conditions of any contract
to which it is a party. |
|
12.1.3 |
Without derogating from the generality of the foregoing provisions, NSMY's MD shall be empowered:- |
| |
|
i) |
to implement the Annual Business Plan as approved by NSMY's Board; |
| |
|
|
|
| |
|
ii) |
to establish business systems for the efficient management of NSMY; |
| |
|
|
|
| |
|
iii) |
subject to such approval of NSMY's Board as may be required pursuant to Clause
9.5.11, to engage and dismiss NSMY's officers, workmen, servants and other
personnel upon such terms as to work functions and terms and conditions of
employment as NSMY's MD deem appropriate and also to modify such terms and
conditions all in accordance with NSMY's approved Annual Business Plan (if any)
and NSMY's employment policy; and |
| |
|
|
|
| |
|
iv) |
subject to such approval of NSMY's Board as may be required pursuant to CLause
9.5 to enter into any contracts in the ordinary course of NSMY's DS Business
and the doing by NSMY in the ordinary course of NSMY's DS Business of all such
acts and things as NSMY's MD may consider necessary or conducive to the interest of NSMY. |
12.2
Chairman of NSMY
|
12.2.1 |
So long as DATO’ NADZMI holds not less than 20% (Twenty Percent) of
NSMH’s total issued share capital, the PARTIES shall cause NSMY to appoint
DATO’ NADZMI as the non-executive Chairman of NSMY upon such terms and
conditions as the NSMY Board (including a NSMY Director nominated by NSE)
determines from time to time the aforesaid terms to include:- |
| |
|
i) |
the payment by NSMY to DATO' NADZMI of a monthly fee of RM10,000.00 (Ringgit Ten
Thousand) or such other amount as may be approved from time to time by NSMY's
Board (including a NSMY Directors nominated by NSE); |
| |
|
|
|
| |
|
ii) |
a monthly car allowance of RM5,000.00 (Ringgit Five Thousand) or such other
amount as may be approved from time to time by NSMY's Board (including a NSMY
Directors nominated by NSE); |
| |
|
|
|
| |
|
iii) |
the provision of an office for DATO' NADZMI at the corporate office of NSMY; and |
| |
|
|
|
| |
|
iv) |
the execution by DATO' NADZMI of a confidentiality and non competition/non solicitation agreement with NSMY
upon terms and conditions acceptable to NSMY and NSE. |
13.
BUSINESS POLICY, FINANCIAL YEAR & POLICY, ANNUAL
BUSINESS PLAN, INTER-CO
AGREEMENTS & OTHER MATTERS
13.1
Business Policy
|
The PARTIES shall cause NSMH and NSMY to carry out its business in accordance with
the following business policy:- |
|
13.1.1 |
NSMY shall carry on and conduct the DS Business in accordance with the Annual
Business Plan approved by NSMY’s Board from time to time and in a proper
and efficient manner; |
|
13.1.2 |
NSMH and NSMY shall comply with all laws and regulations applicable to the DS Business for the time being; |
|
13.1.3 |
NSMY shall use all reasonable means to expand the DS Business and to further the
reputation and interest of NSMY; and |
|
13.1.4 |
NSMY shall maintain with reputable insurers adequate insurance against all risks
usually insured by companies carrying on business similar to NSMY’s DS
Business and for the full replacement value of all assets whether movable or
immovable. |
13.2
Financial Year, Auditors & Accounts
|
13.2.1 |
The annual financial period for which the accounts of NSMH and NSMY shall be
made up and audited shall terminate in each calendar year on 31st
December or such other date as the PARTIES may agree upon to comply with any
applicable law. |
|
13.2.2 |
NSMH’s and NSMY’s Auditors shall be PRICEWATERHOUSE COOPERS or such
major international accounting firm as may be selected and appointed by (as
applicable) the NSMH Members for NSMH or, NSMH from time to time. |
|
13.2.3 |
The respective accounts of NSMH and NSMY shall be kept in English and at the
registered office of (as applicable) NSMH or NSMY. All transactions of NSMH and
NSMY shall be adequately and fully recorded and reflected in (as applicable)
NSMH’s and NSMY’s accounts so that (as applicable) NSMH’s and
NSMY’s accounts give a true and fair view of the financial affairs of (as
applicable) NSMH and NSMY. The PARTIES (and their authorised representatives)
shall have the right to inspect NSMH’s and NSMY’s accounts during (as
applicable) NSMH’s and NSMY’s normal business hours and to make copies
of such accounts. |
|
13.2.4 |
The accounts of NSMH and NSMY shall be prepared on a historical cost basis and
in accordance with generally accepted accounting principles in Malaysia
consistently applied. |
|
13.2.5 |
For the purposes of Clause 13.2.3, the PARTIES shall cause NSMH and NSMY to
devise and maintain a system of internal accounting controls sufficient to
provide reasonable assurance that:- |
| |
|
i) |
transactions are executed in accordance with (as applicable) NSMH's Board or
MSMY's Board's and the managing officers' general or specific authorization; |
| |
|
|
|
| |
|
ii) |
transactions are recorded as necessary:- |
| |
|
|
a) |
to permit preparation of financial statement in conformity with generally
accepted accounting principles or any other criteria applicable to such statements; and |
| |
|
|
|
|
| |
|
|
b) |
to maintain accountability for assets; |
| |
|
iii) |
access to assets is permitted only in accordance with (as applicable) NSMH's Board or NSMY's Board's
and managing officers' general or specific authorisation; and
|
| |
|
|
|
| |
|
iv) |
recorded accountability for assets is compared with the existing assets at reasonable intervals
and appropriate action is taken with respect to any differences. |
13.3
Financing policy
|
13.3.1 |
If the working capital required by (as applicable) NSMH or NSMY exceeds the
total issued and paid-up capital of (as applicable) NSMH or NSMY, the additional
working capital shall be funded in the following manner and order of priority:- |
| |
|
i) |
unsecured borrowings from banks and financial institutions; |
| |
|
|
|
| |
|
ii) |
borrowings from banks and financial institutions secured by assets of (as applicable) NSMH or NSMY; |
| |
|
|
|
| |
|
iii) |
subject to Clause 13.4 below and if (as applicable) NSMH's or NSMY's Board oso approves,
borrowings from banks and financial institutions secured by guarantees of (as applicable)
NSMH Members or NSMH; |
| |
|
|
|
| |
|
iv) |
if (as applicable) NSMH's or NSMY's Board so approves, unsecured advances by the
PARTIES in the Shareholding Proportions; and |
| |
|
|
|
| |
|
v) |
if (as applicable) NSMH's or NSMY's Board so approved, the issue and allotment of (as
applicable) NSMH or NSMY Shares for cash at par to (as applicable) NSMH Members or NSMH. |
|
13.3.2 |
All such advances as the PARTIES may agree to grant to (as applicable) NSMH or
NSMY shall bear interest (both before and after judgement) at a rate equivalent
to 2% (Two Percent) above the Base Lending Rate of MALAYAN BANKING BERHAD
calculated from the date of disbursement of the relevant advance and until the
date of actual repayment by (as applicable) NSMH or NSMY of such advance. |
13.4
NSMH Members’ Guarantees
|
13.3.1 |
If any guarantees from the NSMH Members shall be required for the repayment by
NSMH of the borrowings referred to in Clauses 13.3.1(i) to 13.3.1(iii), such
guarantees of NSMH Members shall be given (subject to all applicable laws) by
NSMH Members in proportion to the Shareholding Proportions or, if proportionate
guarantees shall not be acceptable to the provider of the aforesaid loans
credit, guarantee and other facilities, by the NSMH Members jointly. |
|
13.3.2 |
If a NSMH Member shall not be permitted by applicable laws to give the aforesaid
guarantees then if the other NSMH Members so agree (but without being obliged so
to do) such NSMH Members shall provide (in the proportions in which the NSMH
Shares held by them bear to each other) guarantees for the amount which would
otherwise have been guaranteed by the NSMH Member first referred to. |
|
13.3.3 |
Prior to providing a guarantee for an amount which should (but for applicable
laws) have been guaranteed by another NSMH Member or to payment as a joint
guarantor of such amount of NSMH’s indebtedness as exceeds the proportion
which its NSMH Shares bears to NSMH’s total issued capital, a NSMH Member
shall be entitled to require:- |
| |
|
i) |
within 90 (Ninety) days from the completion of the sale and purchase of such
NSMH Shares or at such later date agreed as may be upon in writing between the
seller and purchaser of such NSMH Shares obtain the release of such seller from
any guarantees and/or indemnities which such seller may have given pursuant to
this Agreement; and
|
| |
|
|
|
| |
|
ii) |
indemnify and keep such seller indemnified against any liability pursuant to any
such guarantee or indemnity until such seller shall be released from all
guarantees and/or indemnities which such seller may have given pursuant to this
Agreement.
|
13.5
Release of Guarantees and Indemnities
|
13.5.1 |
If a NSMH Member disposes of all of its NSMH Shares to another NSMH Member then
subject to Clause 13.5.2, the purchaser of such NSMH Shares shall:- |
| |
|
i) |
within 90 (Ninety days from the completion of the sale and purchase of
such NSMH Shares or at such later date agreed as may be upon in writing between
the seller and the purchaser of such NSMH Shares obtain the release of such seller
may have given pursuant to this Agreement; and
|
| |
|
ii) |
indemnify and keep such seller indemnified against any liability pursuant to any
such guarantee or indemnity until such seller shall be released from all
guarantees and/or indemnities which such seller may have given pursuant to this
Agreement.
|
|
13.5.2 |
The aforesaid release and indemnity shall be conditional upon the discharge by
the aforesaid seller of NSMH Shares of all of its liabilities (other than under
the guarantees and indemnities mentioned in Clause 13.5.1) to NSMH, all third
parties and other NSMH Members accrued or incurred prior to the sale of its NSMH
Shares. |
13.6
Privity
| |
The provisions of Clauses 13.3, 13.4 and 13.5 are strictly agreements (in capable of
assignment in any manner whatsoever) between the PARTIES and enforceable only by
them and none of such provisions may or shall be construed as conferring upon
any third party including any creditor of either NSMH or NSMY any right to
enforce such provisions against any of the PARTIES or otherwise to avail itself
of any benefit therefrom. |
13.7
NSMH’s & NSMY’s company secretary, registered office &
solicitors
|
13.7.1 |
The secretarial firm and NSMH’s and NSMY’s company secretary appointed
by (as applicable) NSMH or NSMY to keep and maintain (as applicable) NSMH’s
or NSMY’s secretarial records shall be such firm and person as shall be
nominated by NSE for approval by (as applicable) NSMH’s Board or
NSMY’s Board. |
|
13.7.2 |
The registered office of NSMH and NSMY shall be at the office of (as applicable)
NSMH’s or NSMY’s secretary and all secretarial records of (as
applicable) NSMH or NSMY shall be kept with (as applicable) NSMH’s or
NSMY’s secretary. |
|
13.7.3 |
The solicitors of (as applicable) NSMH or NSMY shall be such law firm as may be
nominated by NSE for approval by (as applicable) NSMH’s Board or
NSMY’s Board. |
13.8
Annual Business Plan & Periodical Reports of NSMY
| |
|
The PARTIES shall (by the Directors appointed by them) cause (as applicable) NSMH or NSMY:- |
|
13.8.1 |
to prepare and furnish the following documents at the following times to the
NSMY Directors [for approval in the case of the Annual Business Plan referred to
in Clause 9.5.1]:- |
| |
|
i) |
at least 60 (Sixty) days prior to the end of each of NSMY’s
Financial Year, a draft of the Annual Business Plan to be adopted by NSMY for
NSMY's financial year next following; and
|
| |
|
ii) |
within 45 (Forty Five) days of the end of each quarter, a balance sheet,
profit and loss statement and cash flow statement for the preceding quarter; and
|
|
13.8.2 |
to require (as applicable) NSMH’s or NSMY’s Auditors to prepare and
furnish within 5 (Five) months from the end of each of (as applicable)
NSMH’s or NSMY’s Financial Years or such earlier time as NSE requires
so as to enable it to comply with applicable laws of the United States of
America, the audited financial statements of (as applicable) NSMH or NSMY for
the preceding financial year. |
13.9
Dividends & Distribution of Profits
| |
If in respect of any (as applicable) NSMH’s or NSMY’s Financial Year, (as
applicable) NSMH or NSMY shall have profits available for distribution to (as
applicable) NSMH Members or NSMH, the PARTIES shall procure that such profits be
applied in the following manner and order of priority:- |
|
13.9.1 |
as recommended by (as applicable) NSMH’s or NSMY Board, the provision of
working capital to finance the continuing operations and internal growth of the
business of (as applicable) NSMH or NSMY; |
|
13.9.2 |
transfers to reserves consistent with normal commercial requirements of
businesses similar to those carried on by (as applicable) NSMH or NSMY; and
|
|
13.9.3 |
(subject to the availability of sufficient funds in cash and of tax credits
under Section 108 of the Income Tax Xxx 0000 and any deductions required by
applicable laws) the payment of such dividends (if any) as may be recommended by
(as applicable) NSMH’s Board or NSMY’s Board.
|
13.10
Signing Authority in respect of bank account(s) operated by NSMH and NSMY
| |
The bank account(s) of NSMH and NSMY shall be operated and maintained as follows and
the PARTIES shall cause (as applicable) the NSMH Directors or NSMY Directors
appointed by them to pass the relevant board resolutions approving the same:- |
|
13.10.1 |
NSMY shall open and maintain a bank account to be designated as a trust account
whereby all monies payable from time to time by NSMY to NSI’s distributors
on behalf of NSI pursuant to the License Agreement referred to in Clause
13.11.2(i) shall be credited immediately into this trust account as soon as the
amounts payable from time to time to NSI’s distributors are determined
AND
all signatories to operate this designated bank account shall be
nominated and selected by NSE.
|
|
13.10.2 |
subject to Clause 13.10.1, the signing authority in respect of bank account(s)
operated and maintained by NSMH or NSMY from time to time shall be as follows:-
|
| |
|
i) |
for a transaction involving an amount NOT EXCEEDING RM10,000.00 (Ringgit Ten
Thousand), any of the authorised cheque signatory; and
|
| |
|
ii) |
for a transaction involving an amount EXCEEDING RM10,000.00 (Ringgit Ten
Thousand), any 2 (Two) authorised signatories (including a signatory nominated
or selected by NSE) who shall sign JOINTLY.
|
13.11
Inter-co Agreements
|
13.11.1 |
To enable NSMY to undertake and continue to conduct the Said Business, to use
the network of NSI Independent Distributors, sales compensation plan and
trademarks belonging to NSE’s Affiliate. NSI, to have access to NSI
Confidential Information, the exclusive right to distribute the Products in the
Territory and assistance in the form of management and consulting services for
the development of the Said Business, the PARTIES shall cause NSMY to enter into
inter alia licensing and technical/management services agreements, arrangements
and/or transactions with NSE and/or its Affiliates from time to time upon such
terms as NSMY’s Board may approve.
|
|
13.11.2 |
The agreements, arrangements and/or transactions referred to in Clause 13.11.1 will include the following:-
|
| |
|
i) |
a License Agreement with NSI for the grant by NSI to NSMY of a licence to use
NSI's network of NSI Independent Distributors, sales compensation plan and NSI
Confidential Information upon the terms and conditions substantially set forth
in the draft attached hereto marked "Annexure 3A", and includes such amendments
or modifications thereto as may be agreed between NSMY and NSI;
|
| |
|
|
|
| |
|
ii) |
a Trademark Licensing Agreement with NSI for the grant by NSI to NSMY of a
licence to use NSI's trademarks/tradenames upon the terms and conditions
substantially set forth in the draft attached hereto marked "Annexure 3C", and
includes such amendments or modifications thereto as may be agreed between NSMY
and NSI;
|
| |
|
iii) |
a Distribution Agreement with NSE's Affiliate, Nu Skin Enterprises Hong Kong,
Inc. ("NSEHK") for exclusive rights to distribute the Products in the Territory
upon the terms and conditions substantially set forth in the draft attached
hereto marked "Annexure 3B", and includes such amendments or modifications
thereto as may be agreed between NSMY and NSEHK;
|
| |
|
|
|
| |
|
iv) |
a Management Services Agreement with Nu Skin International Management Group,
Inc. ("NSIMG") for the provision by NSIMG of management and consulting services
to NSMY upon the terms and conditions substantially set forth in the draft
attached hereto marked "Annexure 3D", and includes such amendments or
modifications thereto as may be agreed between NSMY and NSIMG.
|
|
13.11.3 |
Each of XXXXXXX and DATO' NADZMI hereby:-
|
| |
|
i) |
acknowledges and confirms that:-
|
| |
|
|
a) |
he(and if applicable, their respective advisors) has had ample opportunity to
review all of the Inter-co Agreements referred to in Clause 13.11.2 and to speak
and ask questions of such persons and representatives of NSE and/or NSI as they
consider necessary to make an informed decision on the acceptance by NSMY of all
of the terms and conditions contained in the Inter-co Agreements; and
|
| |
|
|
|
|
| |
|
|
b) |
the Inter-co Agreements are fair and reasonable to NSMY; and
|
| |
|
ii) |
undertakes to exercise its voting powers and rights in NSMY to cause NSMY's
Board and, if applicable, the NSMY Members to approve the entry by NSMY into the
Inter-co Agreements and the execution by NSMY of the same within 7 (Seven) days
from the date of fulfilment of all of the conditions precedent in Clause 2.1.
|
14.
SALE BY NSMY OF DS BUSINESS OR BY NSMH OF ITS NSMY SHARES
| 14.1 |
If NSE decides that NSMY’s DS Business or all of NSMH’s NSMY Shares
should be sold and so notifies the other PARTIES, each of XXXXXXX and DATO’
NADZMI shall, following the delivery to them of a fairness opinion from a
reputable investment/merchant banker or other adviser that the amount of the
consideration offered by the proposed acquirer is fair to all of the NSMH
Members:- |
|
14.1.1 |
exercise his/its voting powers and rights in NSMH to cause NSMH to approve (as
applicable) the sale and transfer by the PARTIES of their respective NSMH Shares
or the sale by NSMY of NSMY’s DS Business; and
|
|
14.1.2 |
do all other acts and things as may be required of him/it to effect (if
applicable) the sale and transfer of his/its NSMH Shares.
|
| 14.2 |
Subsequent to the completion of (as applicable) NSMY’s sale of its DS
Business or the sale and transfer by all of NSMH Members of all of their
respective NSMH Shares, the PARTIES shall do all acts and things to wind up NSMH
and NSMY voluntarily and to distribute all of NSMH’s assets in the
Shareholding Proportions. |
15.
TERMINATION
15.1
Events of Default
| |
Each of the following events shall be an Event of Default:- |
|
15.1.1 |
if a PARTY commits or allows to be committed a breach of any of such PARTY's
obligations hereunder and, in the case of a breach capable of remedy, fails to
remedy such breach within 30 (Thirty) days after written notice has been
given to such PARTY by any other PARTY requiring such remedy; or
|
|
15.1.2 |
where a PARTY is a body corporate, if a petition shall be presented or an order
made or a resolution passed for the winding up (except as part of a bona fide
scheme of reconstruction or amalgamation) of a PARTY or a PARTY shall compound
with its creditors or have a receiver appointed of the whole or any part of its
assets or shall cease or threaten to cease (other than in the course of
reconstruction or amalgamation) to carry on the whole or any substantial part of
its business; or
|
|
15.1.3 |
where a PARTY is an individual, such PARTY dies, becomes of unsound mind,
incapacitated, commit an act of bankruptcy or is adjudicated a bankrupt or
|
|
15.1.4 |
if adjudication and receiving orders are made against a PARTY; or
|
|
15.1.5 |
if there is a change in control (whether at (board/management or shareholders
level) of a NSMH Member being a body corporate and the prior written consent of
the other PARTIES to such change shall not have been obtained/granted; or
|
|
15.1.6 |
if an Affiliate, a Subsidiary or a Related Co of a PARTY fails to re-transfer
the NSMH Shares held by it to the PARTY who transferred the NSMH Shares to it
within 30 (Thirty) days of its ceasing to be an Affiliate, a Subsidiary
or Related Co of that PARTY; or
|
|
15.1.7 |
if any of the Inter-co Agreements described in Clause 13.11 is terminated or if
NSMY breaches any provision of any of the Inter-co Agreements or commits any act
or omission which entitles (as applicable) NSMY or NSI to terminate any of the
Inter-co Agreements.
|
15.2
Call option/deemed offer of sale/winding-up
| |
Upon the occurrence of an Event of Default, the Non-Defaulter(s) shall be entitled
(but shall not be obliged) by notice in writing issued by the Non-Defaulter or
if there are several of them, by all of the Non-Defaulters, and served on the
Defaulter within 180 (One Hundred and Eighty) days from the date on which
the Non-Defaulter became aware of the occurrence of the Event of Default:- |
|
15.2.1 |
to require the Defaulter to purchase all of the NSMH Shares held by the
Non-Defaulter(s) in which event, the Defaulter shall purchase the aforesaid NSMH
Shares at the price and upon the terms provided in Clauses 15.3 to 15.7; or
|
|
15.2.2 |
to require the Defaulter to sell to the Non-Defaulter(s) (subject to the grant
of MTDCA’s Approval) and if there are several Non-Defaulters, in the
proportions in which the NSMH Shares held by them bear to each other) all of the
NSMH Shares held by the Defaulter whereupon the Defaulter shall immediately make
an offer (failing which it shall be deemed to have made an offer upon its
receipt of the notice served as aforesaid) to sell to the Non-Defaulter(s) the
NSMH Shares held by the Defaulter, at the price and otherwise upon the terms
provided in Clauses 15.3 to 15.7; or
|
|
15.2.3 |
to require NSMH and/or NSMY be wound up in which event, the PARTIES shall
forthwith do all acts and things to procure the winding up of (as applicable)
NSMH and/or NSMY in accordance with all applicable laws and (as applicable)
NSMH’s or NSMY’s articles of association; and/or
|
|
15.2.4 |
to terminate this Agreement but without prejudice to the Defaulter's obligations
arising upon the service of the aforesaid notice and any rights or liabilities
of any PARTY hereunder whether pre-existing or arising from the termination of
this Agreement.
|
15.3
Sale price
| |
The NSMH Shares referred to in Clauses 15.2.1 and 15.2.2 shall be sold and purchased
at the price established in terms stated in Clause 7.2.2(i). |
| |
The costs incurred in establishing the Certified Value of the NSMH Shares referred
to in Clauses 15.2.1 and 15.2.2 shall be borne by the Defaulter. |
| |
The aforesaid costs may be deducted from the proceeds of sale of the NSMH Shares
sold by the Defaulter and applied in discharge of the aforesaid costs. |
15.4
Time for acceptance
| |
The offer to sell the NSMH Shares referred to in Clause 15.2.2 shall remain open for
acceptance for a period of 14 (Fourteen) days from the date on which the
Certified Value is certified. Failing acceptance as aforesaid, the offer shall
be deemed to be declined. |
15.5
Further offers
| |
Any NSMH Share remaining unaccepted as aforesaid shall be deemed to be offered by
the selling PARTY for sale at the price established in terms stated in Clause
7.2.2(i) to such PARTIES as shall have accepted as aforesaid the NSMH Shares
offered to them and in the proportions in which the NSMH Shares held by them
bear to each other. Such PARTIES shall be at liberty to accept the NSMH Shares
offered pursuant to this Clause 15.5 within 7 (Seven) days from the date
of expiry of the period of 14 (Fourteen) days referred to in Clause 15.4. |
| |
If any NSMH Shares remain indisposed of pursuant to the foregoing provisions, then
such further offers as may be necessary shall be deemed to be made in like
manner until all of the NSMH Shares concerned shall have been sold. |
15.6
Acceptances to be subject to the grant of MDTCA’s Approval
| |
Any acceptance given pursuant to the foregoing provisions shall be deemed to be made
subject to, if applicable, the grant of MDTCA’s Approval. |
| |
A PARTY who has accepted an offer made pursuant to Clause 15.2.2 or 15.5 shall be
entitled to nominate a 3rd party Purchaser to purchase the NSMH Shares concerned
in the place of such PARTY if the selling PARTY fails to obtain MDTCA’s
Approval for the sale of the NSMH Shares for reason the proposed purchaser is
not acceptable to MDTCA. |
15.7
Completion of sale and purchase
| |
The sale and purchase of the NSMH Shares referred to in Clauses 15.2.1 and 15.2.2
(the offer wherefore shall have been accepted in the case described in Clause
15.2.2) shall be completed (in respect of Clause 15.2.2, subject to the grant of
MDTCA’s Approval or, if applicable, the nomination of a 3rd Party
Purchaser) at NSMH's registered office within a period of 21 (Twenty One)
days from the date on which the Certified Value is certified or the grant of the
MTDCA’s Approval whichever shall be the later. |
| |
For the purposes of the completion of such sale and purchase:- |
|
15.7.1 |
the PARTY who is the seller of the NSMH Shares aforesaid, shall deliver to the
purchasing PARTY or, if applicable, the 3rd Party Purchaser nominated, the share
certificates to the NSMH Shares sold together with the unstamped forms of
transfer thereof executed by such PARTY in favour of the purchasing PARTY or, if
applicable, the 3rd Party Purchaser; and
|
|
15.7.2 |
the purchasing PARTY or, if applicable, the 3rd Party Purchaser shall (against
the delivery of the aforesaid share certificates and forms of transfer) pay to
the selling PARTY the price established in terms stated in Clause 7.2.2(i) for
such NSMH Shares after deduction (if applicable) of the costs incurred in
establishing the Certified Value thereof and any indebtedness owed by the
selling PARTY to the purchasing PARTY or, if applicable, the 3rd Party
Purchaser.
|
16.
MUTUAL CO-OPERATION
16.1
Compliance and duties of good faith
|
16.1.1 |
do all acts and things within its power (including exercising its voting rights
in NSMH and NSMY for the time being) to procure the implementation of the
provisions of this Agreement;
|
|
16.1.2 |
use its best endeavours at all times to promote, for the common benefit of NSMH
Members, the success of the DS Business;
|
|
16.1.3 |
be just and faithful to the other PARTY in all transactions relating to the DS Business; and
|
|
16.1.4 |
exercise the utmost good faith and maintain the highest integrity in its
dealings with NSMH and NSMY and the other PARTY.
|
16.2
Execution of a new Shareholders Agreement
|
16.2.1 |
Each of XXXXXXX and DATO' NADZMI acknowledges and confirms his awareness that:-
|
| |
|
i) |
following completion of the SPA(OBI), the Other Bumiputera Investor will be a NSMH Member;
|
| |
|
ii) |
the Other Bumiputera Investor may require amendments to the provisions of this
Agreement to accommodate its needs;
|
| |
|
iii) |
a new Shareholders Agreement may need to be executed by the PARTIES and the
Other Bumiputera Investor.
|
|
16.2.2 |
Each XXXXXXX and DATO' NADZMI accordingly:-
|
| |
|
i) |
agrees and undertakes to use his best endeavours to agree, in all good faith, on
all the terms of the new Shareholders Agreement with NSE and the Other
Bumiputera Investor;
|
| |
|
ii) |
agrees that the Other Bumiputera Investor shall be entitled to nominate 1 (One)
NSMH Director and 1 (One) NSMY Director so long it holds the 20% Block;
|
| |
|
iii) |
agrees to all such provisions in the new Shareholders Agreement as are the same
or similar whether in form or substance to the provisions in this Agreement; and
|
| |
|
iv) |
undertakes to consider and execute the new Shareholders Agreement with all possible speed.
|
17.
CONFIDENTIALITY
17.1
Confidentiality
|
17.1.1 |
Each PARTY (who is other than NSE) shall during and after the expiry or
termination of this Agreement, maintain in confidence, all NSI Confidential
Information and NSMY Confidential Information and shall not disclose any NSI
Confidential Information or NSMY Confidential Information for any purpose
whatsoever.
|
|
17.1.2 |
In maintaining the confidentiality of NSI Confidential Information and NSMY
Confidential Information, each PARTY shall exercise the same deuce of care that
he/it exercises with his/its own confidential information and in no event less
than a reasonable degree of care.
|
|
17.1.3 |
Each PARTY shall use his/its best efforts to ensure that except with NSI’s
prior written consent, no person other than such officers and employees of NSMY
as have a need therefor, shall have access to NSI Confidential Information.
|
17.2
Exceptions
|
The obligation of confidentiality contained in Clause 17.1 shall not apply to the extent:-
|
|
17.2.1 |
that a PARTY is required to disclose information by order or regulation of a
governmental agency or a court of competent jurisdiction but such PARTY shall,
to the extent possible, not make any such disclosure without first notifying and
allowing (as applicable) NSI in the case of the NSI Confidential Information or
NSMY in the case of the NSMY Confidential Information, a reasonable opportunity
to seek injunctive relief from (or a protective order with respect to) the
obligation to make such disclosure; or
|
|
17.2.2 |
that the PARTY disclosing information can demonstrate:-
|
| |
|
i) |
that the information disclosed was, at the time of such disclosure already in or
subsequently becomes part of, the public domain other than as a result of
actions of such PARTY in violation of its obligation of confidentiality in
Clause 17.1 or, where such PARTY is a company, corporation or other body
corporate, its Affiliates, or the employees, consultants, agents or
subcontractors of such PARTY or, where such PARTY is a company, corporation or
other body corporate of any of its Affiliates; or
|
| |
|
ii) |
the information disclosed was received by such PARTY on an unrestricted basis
from a source unrelated to NSI, in the case of the NSI Confidential Information
or. NSMY, in the case of the NSMY Confidential Information and such PARTY has no
knowledge or reason to know that he/it is under a duty of confidentiality with
respect of such information.
|
17.3
Unauthorized Disclosure
|
17.3.1 |
Each PARTY acknowledges and confirms that the NSI Confidential Information and
NSMY Confidential Information constitute valuable Draft proprietary information
and trade secrets of NSI and NSMY respectively and that the unauthorized use,
loss or outside disclosure of such information will cause irreparable injury to
NSI, NSMY and NSMH, in the case of the NSI Confidential Information and to NSMY
and NSMH, in the case of the NSMY Confidential Information.
|
|
17.3.2 |
Each PARTY shall notify NSI, in the case of the NSI Confidential Information or
NSMY, in the case of the NSMY Confidential Information, immediately upon
discovery of any unauthorized use or disclosure of (as applicable) NSI
Confidential Information or NSMY Confidential Information, and will cooperate
with (as applicable) NSI or NSMY in every reasonable way to help regain
possession of such information and to prevent its further unauthorized use.
|
|
17.3.3 |
Each PARTY acknowledges that monetary damages will not be a sufficient remedy
for any unauthorized disclosure of the NSI Confidential Information or NSMY
Confidential information and that NSI, in the case of the NSI Confidential
Information and NSMY, in the case of the NSMY Confidential Information, shall be
entitled, without waiving other rights or remedies, to such injunctive or
equitable relief as may be deemed proper by a court of competent jurisdiction,
and shall be entitled to recover reasonable attorney's fees for any action
arising out of or relating to a disclosure of such Confidential Information.
|
18.
PUBLICITY
No
PARTY (other than NSE) shall issue any press release or publish any public
document or make any public statement or announcement of any kind in relation
to, in connection with, arising out of or in respect of the subject matter of
this Agreement or the transactions or matters contemplated by it unless the
purpose, form and text thereof shall be specifically agreed in writing by NSE.
19.
NON-COMPETITION
19.1
Restriction against competition
| |
The provisions of Clauses 9.1.1 to 19.1.7 shall apply, subject to the provisions of
Clause 19.3, to all PARTIES other than NSE. |
|
19.1.1 |
So long as a PARTY is a NSMH Member, such PARTY shall not and shall ensure,
where it is a company, corporation or other body corporate, that (as applicable)
its Affiliate will not establish, develop, carry on or assist in carrying on or
be engaged, concerned, interested or employed in or provide technical,
commercial or professional advice to any business, enterprise or venture or
hold, directly or indirectly, any beneficial interest in a company carrying on
in Malaysia, any business which is the same as or similar to NSMY’s DS
Business and in competition with NSMH, NSMY or any Affiliate of NSMH or NSMY.
|
|
19.1.2 |
So long as a PARTY is a NSMH Member, such PARTY shall not and shall ensure,
where it is a company, corporation or other body corporate, that (as applicable)
its Affiliate will not establish, develop, carry on or assist in carrying on or
be engaged, concerned, interested or employed in or provide technical,
commercial or professional advice to any business, enterprise or venture or
hold, directly or indirectly, any beneficial interest in a company carrying on
in a country other than Malaysia where NSE or NSI and/or its Affiliate carries
on business, any business which is the same as or similar to NSMY’s DS
Business in competition with NSMH, NSMY or any Affiliate of NSMH or NSMY.
|
|
19.1.3 |
A PARTY who ceases to be a NSMH Member shall not and shall ensure, where it is a
company, corporation or other body corporate, that (as applicable) its Affiliate
will not, for a period of 3 (Three) years from the date on which such
PARTY ceases to be a NSMH Member, establish, develop, carry on or assist in
carrying on or be engaged, concerned, interested or employed in or provide
technical, commercial or professional advice to any business, enterprise or
venture or hold, directly or indirectly, any beneficial interest in a company
carrying on in Malaysia, any business which is the same as or similar to
NSMY’s DS Business and in competition with NSMH, NSMY or any Affiliate of
NSMH or NSMY.
|
|
19.1.4 |
A PARTY who ceases to be a NSMH Member shall not and shall ensure, where it is a
company, corporation or other body corporate, that (as applicable) its Affiliate
will not, for a period of 3 (Three) years from the date on which such
PARTY ceases to be a NSMH Member, establish, develop, carry on or assist in
carrying on or be engaged, concerned, interested or employed in or provide
technical, commercial or professional advice to any business, enterprise or
venture or hold, directly or indirectly, any beneficial interest in a company
carrying on in a country other than Malaysia where NSE or NSI and/or its
Affiliate carries on business, any business which is the same as or similar to
NSMY’s DS Business.
|
|
19.1.5 |
So long as a PARTY is a NSMH Member and for a period of 2 (Two) years
thereafter, a PARTY shall not and shall ensure, where it is a company,
corporation or other body corporate, that (as applicable) its Affiliate will
not, for the purpose of offering to such client or customer or obtaining from
such supplier, goods or services similar to or materially competing with those
of NSMY’s DS Business or the Products, solicit, canvass or entice away or
endeavour to solicit, canvass or entice away from NSMY’s DS Business, the
custom of any person, firm or company who (as applicable) is or was at any time
during the period of 12 (Twelve) months immediately preceding the date on
which such PARTY ceases to be a NSMH Member:-
|
| |
|
i) |
following its negotiations with NSMY for the supply of goods or services, a
potential supplier of goods or services to NSMY in relation to NSMY’s DS
Business; or
|
| |
|
ii) |
a customer of or supplier to NSMY's DS Business; or
|
| |
|
iii) |
in the habit of otherwise dealing with NSMY in relation to NSMY's DS Business.
|
|
19.1.6 |
A PARTY shall not at any time after such PARTY ceases to be a NSMH Member, carry
on business or trade under a name which is identical with or similar to any
names used by NSMY’s DS Business or which suggests any connection with
NSMY’s DS Business or NSE or NSI.
|
|
19.1.7 |
So long as a PARTY is a NSMH Member and for a period of 3 (Three) years
thereafter, such PARTY shall not and shall ensure that (as applicable) its
Affiliate will not solicit or entice away from NSMH or NSMY or its Subsidiaries,
any person who is an officer, manager or employee of NSMH or NSMY or of any of
its Subsidiaries.
|
19.2
Construction of restrictions
|
19.2.1 |
The obligations contained in Clause 19.1 shall be construed as separate
obligations and if one or more of such obligation is/are held to be against the
public interest or unlawful or in any way an unreasonable restraint of trade,
the remaining obligations shall continue to bind the NSMH Member concerned.
|
|
19.2.2 |
If any obligation contained in Clause 19.1 would be void as drawn but would be
valid if the period or territory of application were reduced or if some part of
the obligation were deleted, the obligation in question shall apply with such
modification as may be necessary to make it valid and effective.
|
19.3
Limits on restriction
|
The provisions of Clause 19.1.1 shall not apply to:-
|
|
19.3.1 |
the sale, marketing or distribution of products which are not personal care,
nutritional products or other products marketed by NSMY from time to time;
|
|
19.3.2 |
the holding by a PARTY or its holding company of not more than 2% (Two
Percent) of the ordinary shares of a company carrying on any business which is
the same as or similar to the DS Business if such company is listed on the Kuala
Lumpur Stock Exchange or other recognised stock exchange and the ordinary shares
of such company are quoted on (as applicable) the Kuala Lumpur Stock Exchange or
other recognised stock exchange;
|
|
19.3.3 |
the sale, marketing and distribution of the Products as a distributor of NSMY or
as an officer or employee of NSMY or of NSE or its Affiliate; or
|
|
19.3.4 |
the holding of any office or employment in NSE or its Affiliate.
|
19.4
Acknowledgments of reasonableness of duration & scope of non-competition obligation
|
Each PARTY acknowledges and agrees:-
|
|
19.4.1 |
that the availability to NSMY pursuant to the Interco Agreements of, among
others, NSI Confidential Information including NSI’s know-how in
establishing and managing a direct sales business and a licence use NSI’s
network of NSI Independent Distributors, NSI’s sales compensation plan is
essential and critical to the very existence, success and growth of NSMH and
NSMY; and
|
|
19.4.2 |
that NSE and its Affiliate conduct their respective businesses synergistically
on a worldwide basis and as an integrated business;
|
|
19.4.3 |
that the Products are promoted and sold by NSE and its Affiliates on a worldwide
basis through NSI's Independent Distributors; and
|
|
19.4.4 |
that each of the NSI Independent Distributors is entitled to market and sell,
whether by himself/herself/itself or by others of the NSI Independent
Distributors in his/her/its downline organisation, the Products in any country
in which NSE or any of its Affiliate carries on business;
|
|
19.4.5 |
that accordingly the respective periods and areas encompassed in Clause 19.1 are
reasonable so as to enable NSMY and NSMH to protect and also derive commercial
returns from:-
|
| |
|
i) |
the licences, rights and other privileges granted to NSMY pursuant to the
Interco Agreements which are essential and critical to NSMY's and NSMH's
respective businesses; and
|
| |
|
ii) |
the NSI Confidential Information which is made available to NSMY for use
pursuant to the Interco Agreements and which NSMY as a user is required to
safeguard;
|
|
19.4.6 |
that in undertaking such the activities described in Clauses 19.1.1 to 19.1.7 as
are not specifically permitted by Clause 19.3, a PARTY (other than NSE) will
necessarily use the NSI Confidential Information and the other intellectual
property of NSE and its Affiliates which NSMY is permitted to use as licensee
pursuant to the Interco Agreements; and
|
|
19.4.7 |
that damages alone would not constitute an adequate remedy for a breach by a
PARTY of his obligation under Clause 19.1.
|
20.
REPRESENTATIONS & WARRANTIES
20.1
PARTIES’ Warranties
|
Each of the PARTIES hereby represents and warrants to the other PARTIES that:-
|
|
20.1.1 |
such PARTY has full power and authority to enter into and execute this Agreement
and all instruments to be executed by such PARTY pursuant to this Agreement and
to carry the terms hereof and thereof and deliver and perform all of its
obligations under this Agreement and any other agreements contemplated
hereunder;
|
|
20.1.2 |
this Agreement constitutes the legal, valid and binding obligations of the PARTY
in accordance with their respective terms; and
|
|
20.1.3 |
such PARTY is not in default under any agreement to which it is a party or by
which it is bound and no litigation, arbitration or administrative proceedings
are presently current or pending or threatened which default, litigation,
arbitration or administrative proceedings, as the case may be, might materially
affect the ability of such PARTY to enter into and/or perform its obligations
under this Agreement.
|
20.2
NSE’s Warranties
|
NSE hereby represents and warrants to the other PARTIES that:-
|
|
20.2.1 |
it is a company duly organized and incorporated and validly existing and in good
standing under the laws of the jurisdiction of its place of incorporation and
has full power and authority to enter into and execute this Agreement and all
instruments to be executed by it pursuant to this Agreement and to carry the
terms hereof and thereof and deliver and perform all of its obligations under
this Agreement and any other agreements contemplated hereunder; and
|
|
20.2.2 |
the execution, delivery and performance of this Agreement are within its
corporate power, have been duly authorised by all necessary corporate action,
does not contravene its memorandum and articles of association and does not
violate any law or regulation or any judgment, order or decrees of any
governmental authority, or any contract or undertaking binding on or affecting
it.
|
20.3
FRANKIE’s/DATO’ NADZMI’s Warranties
|
Each of XXXXXXX and DATO' NADZMI hereby represent and warrant to the other PARTIES that:-
|
|
20.3.1 |
he is not a bankrupt and has not committed any act of bankruptcy; and
|
|
20.3.2 |
he has not committed any criminal offence.
|
21.
DURATION
21.1
Effective Date
| |
The Effective Clauses shall take effect upon the execution of this Agreement and the
other provisions of this Agreement shall take effect upon the fulfillment of all
of the conditions precedent contained in Clause 2.1 and this Agreement shall
continue thereafter in full force and effect until:- |
|
21.1.1 |
NSMH and NSMY shall be dissolved or otherwise cease to exist as a separate entity; or
|
|
21.1.2 |
this Agreement is terminated by mutual consent of the PARTIES; or
|
|
21.1.3 |
this Agreement is terminated pursuant to the terms hereof.
|
21.2
Termination
|
Upon the occurrence of any of the aforesaid events, this Agreement shall be deemed to
be terminated forthwith.
|
22.
FORCE MAJEURE/VIS MAJOR
22.1
Suspension of obligations
| |
If a PARTY is rendered unable wholly or in part by force majeure or vis major to
carry out its obligations under this Agreement, such PARTY shall give to the
other PARTY prompt written notice of the force majeure or vis major with
reasonably full particulars concerning the same whereupon the obligations of the
PARTY giving the notice, so far as it is affected by the force majeure or vis
major shall be suspended during, but not longer than the continuance of the
force majeure or vis major. |
| |
The PARTY giving the notice shall use all possible diligence to remove the effects
of such force majeure or vis major with all due speed. |
22.2
Alternative performance
| |
The PARTIES shall use their best endeavours to agree by immediate consultation on an
alternative method of performance of any obligations or duties affected by the
force majeure or vis major for so long as the same continues. |
23.
SEVERABILITY
| |
Any term, condition, stipulation, provision, covenant or undertaking in this
instrument which is illegal, void, prohibited or unenforceable shall be
ineffective to the extent of such illegality, voidness, prohibitions or
unenforceability without invalidating the remaining provisions hereof, and any
such illegality, voidness, prohibition or unenforceability shall not invalidate
or render illegal, void or unenforceable any other term, condition, stipulation,
provision, covenant or undertaking herein contained. |
24.
MODIFICATIONS TO AGREEMENT & WAIVERS
24.1
Modifications in writing
| |
Any modification of or alteration to any part of this Agreement, shall be conferred
upon and determined in writing by mutual consultation between the PARTIES. |
24.2
Delay or acquiescence
| |
No failure or delay on the part of any PARTY in exercising any power or right under
this Agreement shall operate as a waiver of such power or right nor shall the
knowledge or acquiescence by any PARTY hereto of or in a breach of any terms or
conditions of this Agreement constitute a waiver of such terms or conditions. |
24.3
Subsequent breaches not affected
| |
No waiver by any PARTY of a breach of any term or condition of this Agreement shall
constitute a waiver of any subsequent breach of the same or any other term or
condition of this Agreement. |
24.4
Waivers to be in writing
| |
No waiver of any of the terms of this Agreement shall be valid unless in writing
and signed by or on behalf of the PARTIES. |
25.
GOVERNING LAW & JURISDICTION
This
Agreement shall be governed by and be construed in accordance with the laws of
Malaysia and subject to Clause 24, the PARTIES shall submit unconditionally to
the non- exclusive jurisdiction of the courts in Malaysia.
26.
ARBITRATION
26.1
Reference to Arbitration
| |
Any dispute or difference which may arise between the PARTIES at any time hereafter
whether during the continuance in force of this Agreement or upon or after its
termination, touching any matter or thing herein contained or the operation or
construction of this Agreement or any matter or thing in any way connected with,
arising from or in relation to this Agreement or the rights, duties, liabilities
of the PARTIES hereunder shall be finally settled by arbitration in accordance
with the United Nations Commission on International Trade Law Arbitration Rules
1976. |
26.2
Arbitral Proceedings
| |
A reference to arbitration shall be to 3 (Three) arbitrators. The
arbitration shall be held in Provo, Utah, United States of America and the
language to be used in the arbitral proceedings shall be English. |
26.3
Interim remedies
| |
Pending the establishment of the arbitral tribunal, the PARTIES may apply to the courts
in Malaysia (which shall have non-exclusive jurisdiction) for the grant of
interim injunctions and orders for the protection and preservation of property
subject of or relating to this Agreement. |
27.
NO AGENCY
None
of the provisions herein shall be deemed to constitute an agency between the
PARTIES and none of the PARTIES shall have any authority to bind or shall be
deemed to be the agent of the other PARTIES for any purpose whatsoever.
28.
LANGUAGE OF AGREEMENT
The
rights and obligations of the PARTIES shall be construed in accordance with the
English version of this Agreement which shall be the authoritative version of
this Agreement notwithstanding any translation of the same into any other
language.
29.
COUNTERPARTS
This
Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one and the same instrument and any of the PARTIES may
execute this Agreement by signing any such counterparts.
30.
NOTICES
30.1
Written notices
| |
Any notice with reference to this Agreement shall be in writing signed by the PARTY
by whom it is served or by its solicitors and shall be deemed to be sufficiently
served or given for all purposes herein on the PARTY to whom it is served if it
is left by hand at or sent by commercial courier, registered post being airmail
in the case of a notice for international delivery or facsimile (with copy by
hand or commercial courier or ordinary or registered post being airmail in the
case of a notice for international delivery) to (as applicable) the address of
the PARTY to whom it is sent as set out below or the registered office for the
time being of such PARTY or such other address as one PARTY may from time to
time notify to the other PARTY in writing. |
|
30.1.1 |
to NSE
NU SKIN ENTERPRISES, INC.
00 Xxxx Xxxxxx Xxxxxx, Xxxxx, Xxxx 00000
Xxxxxx Xxxxxx of America
Telefax: 00 1 801 345 3899
Attn: General Counsel
|
|
30.1.2 |
to XXXXXXX
XXXX XXX XXXX, XXXXXXX
5-C, Xxxx Xx Xxxxx
000, Xxxxx Xxx Xxxx
Xxxx Xxxx
Telefax: 00 852 2898 8271
|
|
30.1.3 |
to DATO' NADZMI
DATO' MOHD NADZMI BIN MOHD SALLEH
Xx. 00-0, Xxxxx XXX0/0X
Xxxxxxx Xxxxxxxx Xxxxxx
Bandar Damansara Perdana
47820 Petaling Jaya
Selangor Darul Ehsan
Telefax:
|
30.2
Time of service
|
30.2.1 |
by facsimile (and confirmed by the delivery of a copy thereof by hand or
commercial courier or ordinary or registered post) shall be deemed to have been
served and received upon completion of the effective transmission of such notice
and a written record of the transmission is printed from the sender’s
facsimile machine;
|
|
30.2.2 |
by ordinary or registered post for delivery in the country in which it is posted
shall be deemed to have been served and received on the 3rd (Third) day
occurring after the date on which it is posted;
|
|
30.2.3 |
by ordinary or registered airmail for international delivery shall be deemed to
have been served and received on the 10th (Tenth) day occurring after the
date on which it is posted; and
|
|
30.2.4 |
by hand or commercial courier shall be deemed to have been served at the time of delivery of the notice.
|
31.
COSTS
31.1
Agreement
| |
Each Party shall bear its own solicitors' costs of and incidental to this Agreement.
The stamp duty chargeable on this Agreement shall be borne by the PARTIES in
equal proportions. |
31.2
Sale of NSMH Shares
| |
The stamp duty payable on any transfer of NSMH Shares shall be borne by the
transferee thereof. The stamp duty and other disbursements, if any, chargeable
on the transfers of NSMH Shares sold and purchased pursuant to an Offer shall be
borne by the purchaser thereof. |
32.
NON-ASSIGNABILITY
No
PARTY may assign its rights hereunder or any interest herein or transfer its
obligations hereunder to any person, firm or company without the prior written
consent of the other PARTIES.
33.
SUCCESSORS-IN-TITLE
This
Agreement is binding upon the successors-in-title and permitted assigns of a
PARTY who is a body corporate and the heirs, personal representative and
permitted assigns of a PARTY who is an individual/natural person.
IN
WITNESS WHEREOF the PARTIES have hereunto execute this Agreement the day
and year first above written.
| SIGNED by |
) |
|
| for and on behalf of |
) |
|
| NU SKIN ENTERPRISES, INC. |
) |
|
| NSE aforesaid in the presence of:- |
) |
|
| |
|
|
| |
|
|
| |
|
|
| SIGNED by KIOW XXX XXXX, XXXXXXX |
) |
|
| XXXXXXX aforesaid in the presence of:- |
) |
|
| |
|
|
| |
|
|
| |
|
|
| SIGNED by DATO' MOHD NADZMI |
) |
|
| BIN MOHD SALLEH |
) |
|
| DATO' NADZMI aforesaid in the presence of:- |
) |
|
This is the execution page of the
Shareholders Agreement dated the 28th day of September 2001 between NU SKIN
ENTERPRISES, INC., KIOW XXX XXXX and DATO' MOHD NADZMI BIN MOHD SALLEH
