EX-10.3
7
v205599_ex10-3.htm
Dated
December 14, 2010
Between
Wafergen
Bio-Systems (M) Sdn Bhd
and
Wafergen
Bio-Systems Inc
and
Malaysian
Technology Development Corporation
Sdn
Bhd
and
Prima
Mahawangsa Sdn Bhd
amended
and restated
Shareholders’
Agreement
Wafergen
Biosystems (M) Sdn Bhd
Contents
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Recitals
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1
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| | | | |
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1
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Definitions
and Interpretations
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2
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1.1
|
Definitions
|
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2
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1.2
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Interpretation
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4
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| | | | | |
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2.
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[Deleted]
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5
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3.
|
[Deleted]
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5
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4.
|
[Deleted]
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5
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5.
|
Undertakings,
Warranties and Representations by the Parties
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|
5
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| | | | |
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6.
|
Management
of the Company
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6
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6.1
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Board
of Directors
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6
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6.2
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Board
Meetings
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7
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6.3
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Provisions
in respect of meetings
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7
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6.4
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Resolutions
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7
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6.5
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Circular
resolution
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7
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6.6
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No
shareholding requirement
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|
8
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6.7
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Management
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8
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6.8
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Nominees
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8
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| | | | | |
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7.
|
General
meetings
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8
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7.1
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General
meetings
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8
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7.2
|
Quorum
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8
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7.3
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Decisions
at meetings of the Shareholders
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8
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7.3.1
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Ordinary
Resolution
|
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8
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7.3.2
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Special
Resolution
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9
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7.4
|
Shareholder
Reserve Matters
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9
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| | | | | |
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8.
|
Business
of the Company
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|
9
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| | | | |
|
9
|
New
Issues of Shares
|
|
11
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|
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9.1
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New
Issues by Company
|
|
11
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9.2
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Offer
to Shareholders
|
|
11
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9.3
|
Waiver
|
|
11
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| | | | | |
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10.
|
Transfers,
Acquisitions and Disposal of Shares
|
|
11
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|
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10.1
|
Pre-emption
Rights
|
|
11
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| | | | | |
|
11
|
Put
Options
|
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13
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|
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11.1
|
Investors’
Put Right for shares in the Existing Shareholder
|
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13
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|
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11.2
|
Investors’
Put Option for Series A RCPS or Conversion Shares
|
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14
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| | | | | |
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12.
|
Duration
and Xxxxxxxxxxx
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|
00
|
| | | | |
|
00.
|
Previous
Agreements and Prevalence of Agreement
|
|
14
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| | | | |
|
14.
|
Remedy
on an Event of Default
|
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15
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| | | | |
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15.
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Confidentiality
|
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16
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| | | | |
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16.
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Deadlock
|
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16
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16.1
|
Disputes
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16
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| | | | | |
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17.
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Further
Assurance
|
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16
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Page
| i
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18.
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Remedies
|
|
16
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| | | | |
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19.
|
Waiver
and Variation
|
|
17
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|
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19.1
|
Rights
not affected
|
|
17
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|
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19.2
|
Cumulative
rights and remedies
|
|
17
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19.3
|
Variation
|
|
17
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| | | | | |
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20.
|
Severability
|
|
17
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| | | | |
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21.
|
Continuing
Effect
|
|
17
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| | | | |
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22.
|
Time
|
|
17
|
| | | | |
|
23.
|
Legal
Relationship
|
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17
|
| | | | |
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24.
|
Costs
and Expenses
|
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17
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| | | | |
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25.
|
Assignment;
Successors
|
|
18
|
|
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25.1
| Assignment |
|
18
|
|
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25.2
| Successors
and assigns |
|
18
|
| | | | |
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26.
|
Notices
|
|
18
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| | | | |
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27.
|
Entire
agreement
|
|
20
|
| | | | |
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28.
|
Counterparts
|
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20
|
| | | | |
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29.
|
Governing
Law and Jurisdiction
|
|
20
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| | | | |
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SCHEDULE
1
|
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21
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|
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1.
|
Subscription
Price and par value
|
|
21
|
|
|
2.
|
Premium
|
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21
|
|
|
3.
|
Dividend
Provision
|
|
21
|
|
|
4.
|
Liquidation
Preference
|
|
21
|
|
|
5.
|
Conversion
|
|
21
|
|
|
6.
|
[Deleted]
|
|
23
|
|
|
7.
|
Redemption
Rights
|
|
23
|
|
|
8.
|
Voting
Rights
|
|
23
|
|
|
9.
|
Protective
Provisions
|
|
23
|
|
|
10.
|
No
Variation
|
|
24
|
| | | | | |
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SCHEDULE
2
|
|
25
|
|
|
1.
|
Representations
and Warranties by the Investors
|
|
25
|
|
|
2.
|
Representations
and Warranties by the Existing Shareholder and the Company
|
|
25
|
| | | | | |
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SCHEDULE
3
|
|
27
|
|
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1.
|
Subscription
Price and par value
|
|
27
|
|
|
2.
|
Premium
|
|
27
|
|
|
3.
|
Dividend
Provision
|
|
27
|
|
|
4.
|
Liquidation
Preference
|
|
27
|
|
|
5.
|
Conversion
|
|
27
|
|
|
6.
|
[Deleted]
|
|
29
|
|
|
7.
|
Redemption
Rights
|
|
29
|
|
|
8.
|
Voting
Rights
|
|
29
|
|
|
9.
|
Protective
Provisions
|
|
29
|
|
|
10.
|
No
Variation
|
|
30
|
Page
| ii
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SCHEDULE
4
|
|
31
|
|
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1.
|
Subscription
Price and par value
|
|
31
|
|
|
2.
|
Premium
|
|
31
|
|
|
3.
|
Dividend
Provision
|
|
31
|
|
|
4.
|
Liquidation
Preference
|
|
31
|
|
|
5.
|
Conversion
|
|
31
|
|
|
6.
|
[Deleted]
|
|
32
|
|
|
7.
|
Redemption
Rights
|
|
32
|
|
|
8.
|
Voting
Rights
|
|
32
|
|
|
9.
|
Protective
Provisions
|
|
32
|
|
|
10.
|
No
Variation
|
|
33
|
Page
| iii
This
Agreement is made on December 14, 2010 between:
|
(1)
|
Wafergen
Biosystems (M) Sdn Bhd (Company No 795066-H), a company
incorporated in Malaysia with a registered address at Xxxxx 0-0, 0xx
Xxxxx, Xxxxxx Xxxxxx Garden, 00X, Xxxxx Xxxxxx Xxxxx Xxxx, 00000 Xxxxxx,
Xxxxxxxx. (“Company”);
|
and
|
(2)
|
Wafergen
Bio-Systems, Inc (WGBS.OB), a Nevada USA incorporated company with a
registered address and place of business at 0000 Xxxxx Xxxxx Xxxxxxx,
Xxxxxxx, XX 00000, XXX (“Existing
Shareholder”);
|
and
|
(3)
|
Malaysian
Technology Development Corporation Sdn Bhd (Company No 235796-U), a
company incorporated in Malaysia with a registered address at Xxxxx 0,
Xxxxxx Yayasan Tun Razak, Xxxxx Xxxxx Xxxxxxx, 00000 Xxxxx Xxxxxx (“MTDC);
|
and
|
(4)
|
Prima
Mahawangsa Sdn Bhd (Company No. 833152-M), a company incorporated in
Malaysia with a registered address at 5th Floor, Bangunan XXXX, Xxxxx
Xxxxxxxx, Xxxxxxxxx Xxxxxxx, 00000 Xxxxx Xxxxxx (“PMSB”).
|
(The
Company, the Existing Shareholder, MTDC and PMSB are collectively referred to as
“Parties” and each as a
“Party”).
Recitals
|
(A)
|
Pursuant
to a Share Subscription and Shareholders’ Agreement dated 8 May 2008
between the Company, the Existing Shareholder and MTDC (“Shareholders’
Agreement”), MTDC agreed to subscribe for 888,888 redeemable
convertible preference shares of RM0.01 each in the capital of the Company
(“Series A RCPS”)
and the Company, the Existing Shareholder and MTDC agreed to regulate the
affairs and their relationship in the Company in accordance with the
Shareholders’ Agreement.
|
|
(B)
|
The
Existing Shareholder, the Company, Prima Mahawangsa Sdn Bhd (“PMSB”) and Expedient
Equity Ventures Sdn Bhd (“EEV”) entered into a
Share Subscription Agreement (“Subscription Agreement”)
and Deed of Adherence (“DA”) both dated 3 April
2009 where PMSB agreed to subscribe for 444,444 Series B Redeemable
Convertible Preference Shares (“Series B RCPS”) in the
Company and EEV agreed to subscribe for 222,222 Series B RCPS, pursuant to
the terms and conditions in the Subscription Agreement and Deed of
Adherence.
|
|
(C)
|
The
Existing Shareholder, the Company and Kumpulan Modal Perdana Sdn Bhd
(“KMP”) entered
into a Share Subscription Agreement (“KMP SSA”) and Deed of
Adherence (“KMP
DA”) both dated 1 July 2009 where KMP agreed to subscribe for
188,057 Series
B RCPS pursuant to the terms and conditions in the KMP SSA and KMP
DA.
|
Page
| 1
|
(D)
|
The
Existing Shareholder, the Company and MTDC have entered into this
Agreement simultaneously with a Share Subscription Agreement
dated December
2010 (“Series C
Subscription Agreement”) where MTDC agreed to subscribe for
3,233,734 Series C Redeemable Convertible Preference Shares (“Series C RCPS”) in the
Company with an option to subscribe for a further 1,077,911 Series C RCPS
pursuant to the terms and conditions in the Series C Subscription
Agreement.
|
|
(E)
|
EEV
and KMP have exercised their put option under the relevant put agreements
and exchanged the Series B RCPS held with the Existing Shareholder for
shares in the Existing Shareholder and as at the date of this Agreement,
EEV and KMP have ceased to be Series B RCPS holders in the
Company.
|
|
(F)
|
The
remaining shareholders, that is the Existing Shareholder, MTDC and PMSB
are desirous of undertaking the Business through the Company and agree to
regulate their relationship as shareholders of the Company in accordance
with the terms and conditions of this
Agreement.
|
|
(G)
|
Clause
11 is applicable only to MTDC.
|
|
(H)
|
The
current shareholding in the Company is as
follows:
|
|
Shareholder
| |
Shares
| | |
Series A RCPS
| | |
Series B RCPS
| |
|
Existing
Shareholder
| |
300,000
| | |
-
| | |
410,279
| |
|
MTDC
| |
-
| | |
888,888
| | |
-
| |
|
PMSB
| |
-
| | |
-
| | |
444,444
| |
It
is agreed as follows:
|
1
|
Definitions
and Interpretations
|
In this
Agreement, unless the context otherwise requires:
|
Act
|
means
the Companies Xxx 0000;
|
|
|
|
|
Articles
|
means
the articles of association of the Company;
|
|
|
|
|
Board
|
means
the board of directors of the Company;
|
|
|
|
|
Business
|
means
the business of the Company as defined in Clause 8.1;
|
|
|
|
|
Conversion
Shares
|
means
the Shares resulting from the conversion of the RCPS, such Conversion
Shares to rank pari passu in all respects with all other then existing
Shares, and “Conversion Share” means one (1) of the Conversion
Shares;
|
|
|
|
|
Director
|
means
any director of the Company appointed on the Board including, where
applicable, any alternate
director;
|
Page
| 2
|
Encumbrance
|
means
any mortgage, charge, pledge, lien, assignment, hypothecation, security
interest, title retention, right of first refusal, pre-emption right,
option, preferential right or trust arrangement or other security
arrangement or agreement conferring a right to a priority of
payment;
|
|
|
|
|
Investors
|
means
MTDC, PMSB and any other person acceding to this
Agreement;
|
|
|
|
|
IPO
|
means
the listing of the Company on any approved stock
exchange;
|
|
|
|
|
Parties
|
means
the Existing Shareholder, MTDC, PMSB, and the Company, and “Party” refers
to any one (1) of them;
|
|
|
|
|
PMSB
|
means
Prima Mahawangsa Sdn Bhd (Company No. 833152-M), a company incorporated in
Malaysia with a registered address at 5th Floor, Bangunan XXXX, Xxxxx
Xxxxxxxx, Xxxxxxxxx Xxxxxxx , 00000 Xxxxx Xxxxxx;
|
|
|
|
|
Public
Authorities
|
includes:
(a) any
government in any jurisdiction, whether federal, state, provisional,
territorial or local;
(b) any
minister, department, officer, commission, delegate, instrumentality,
agency, board, authority or organisation of any government or in which any
government is interested;
(c) any
non-government regulatory authority; or
(d) any
provider of public utility services, whether or not government owned or
controlled;
|
|
|
|
|
Put
Agreement
|
means
the Put Agreement dated 28 May 2008 entered into by MTDC with the Existing
Shareholder;
|
|
|
|
|
RCPS
|
means
Series A RCPS, Series B RCPS and/or Series C RCPS;
|
|
|
|
|
RM
|
means
the lawful currency of Malaysia;
|
|
|
|
|
Series
A Director
|
means
the director as defined in Clause 6.1(a);
|
|
|
|
|
Series
B Director
|
means
the director as defined in Clause 6.1(c);
|
|
|
|
|
Series
C Director
|
means
the director as defined in Clause 6.1(a);
|
|
|
|
|
Series
A RCPS
|
means
Series A Redeemable Convertible Preference Shares of the Company with
principal terms as set out in Schedule
1;
|
Page
| 3
|
Series
B RCPS
|
means
Series B Redeemable Convertible Preference Shares of the Company with
principal terms as set out in Schedule 3;
|
|
|
|
|
Series
C RCPS
|
means
Series C Redeemable Convertible Preference Shares of the Company with
principal terms as set out in Schedule 4;
|
|
|
|
|
Shareholders
|
means
the shareholders of the Company from time to time;
|
|
|
|
|
Shares
|
means
ordinary shares of RM1.00 each in the share capital of the Company, and
“Share” refers to
any one (1) of them;
|
|
|
|
|
Subscription
Price
|
means
the Ringgit Malaysia equivalent to the subscription price paid in USD for
the RCPS calculated at the prevailing exchange rate on the
date payment of the Subscription Price is effected, paid by the
respective Investors for each RCPS, out of which RM0.01 is to be paid
towards the par value of each RCPS and the difference between the
Subscription Price and the par value of RM0.01 (constituting the
subscription premium) is to be credited to the share premium account of
the Company;
|
|
|
|
|
USD
|
means
the lawful currency of United States of America; and
|
|
|
|
|
Warranties
|
means
the representations and warranties made by the Investors, the
Existing Shareholder and the Company, as set out in Schedule
2.
|
In this
Agreement, unless the context otherwise requires:
|
|
(a)
|
headings
and underlining are for convenience only and do not affect the
interpretation of this Agreement;
|
|
|
(b)
|
words
importing the singular include the plural and vice
versa;
|
|
|
(c)
|
words
importing a gender include any
gender;
|
|
|
(d)
|
an
expression importing a natural person includes any corporation or other
body corporate, partnership, association, governmental agency, two or more
persons having a joint or common interest, or any other legal or
commercial entity or undertaking;
|
|
|
(e)
|
a
reference to a party to a document includes that party's successors and
permitted assigns;
|
|
|
(f)
|
any
part of speech or grammatical form of a word or phrase defined in this
Agreement has a corresponding meaning;
and
|
Page
| 4
|
|
(g)
|
a
warranty, representation, covenant or agreement on the part of two or more
persons binds them jointly and
severally.
|
Notwithstanding
that this Agreement is executed simultaneously with the Series C Subscription
Agreement, the Parties agree that this Agreement shall only take effect on the
Initial Closing Date (as defined in the Series C Subscription
Agreement).
|
5.
|
Undertakings,
Warranties and Representations by the
Parties
|
|
5.1
|
Subject
to any exceptions expressly and specifically disclosed in any
correspondence, communication, document or information in writing prior to
the execution of this Agreement, the Parties warrant to each other that
the information and statements set out in the Warranties are true,
accurate and correct in all respects at the date of this
Agreement.
|
|
5.2
|
The
Parties acknowledge and agree that each of them entered into this
Agreement and the subscription by the Investors for the RCPS is in
reliance on the Warranties.
|
|
5.3
|
Each
of the Warranties is separate and is to be construed independently of the
others and is not limited by reference to any of the other
Warranties.
|
Save as
disclosed to the Investors in any correspondence, communication, document or
information in writing prior to the execution of this Agreement, no information
relating to the RCPS or the Company will limit the nature of the Warranties
given by the Company under this Agreement, or will prejudice any claim to be
made by the Investors against the Company for any breach of the
Warranties.
Each of
the Party will indemnify and will keep the other Parties indemnified against all
losses, damages, costs and expenses which the other Parties may incur or be
liable for in respect of any claim, demand, liability, action, proceedings or
suits arising out of or in connection with:
|
|
(a)
|
a
breach of a Warranty;
|
|
|
(b)
|
any
Warranty not being true and correct in all respects;
or
|
|
|
(c)
|
any
Warranty being misleading in any
respect,
|
save and
except where any of the matters set out in paragraphs 5.1 to 5.3 above shall
have been apparent in any correspondence, communication, document or information
in writing and disclosed or provided to the Investors prior to the
execution of this Agreement.
Page
| 5
|
6.
|
Management
of the Company
|
The Board
shall comprise 8 directors of which:
|
|
(a)
|
MTDC
shall have the right to appoint two (2) directors comprising one Series A
Director and 1 Series C Director. MTDC shall procure that (if relevant),
the Series A Director and Series C Director shall, prior to his
appointment as a director of the Company, provide a confidentiality and
non-competition undertaking to the
Company;
|
|
|
(b)
|
the
Existing Shareholder shall have the right to appoint five (5) directors
and such right shall include the appointment of the Chief Executive
Officer; and
|
|
|
(c)
|
PMSB
shall have the right to appoint one (1) director (“Series B Director”) and
PMSB shall procure that (if relevant), the Series B Director shall, prior
to his appointment as a director of the Company, provide a confidentiality
and non-competition undertaking to the
Company.
|
MTDC
shall have the right to nominate an alternate to the Series A Director and
Series C Director and the Existing Shareholder shall have the right to nominate
an alternate director to such directors appointed under paragraph 6.1(b). PMSB
shall have the right to nominate an alternate to the Series B
Director.
MTDC and
the Existing Shareholder will jointly appoint an independent director to the
Board with the requirement that the independent director has relevant
international industry experience in the Business and if such independent
director is appointed, the Existing Shareholder may only then appoint 4
directors.
The right
of appointment of the Series A Director and Series C Director shall include the
right for MTDC to remove such persons at any time from such office and also the
right to determine from time to time the period which such persons shall hold
office as the Series A Director and Series C Director. Upon MTDC
ceasing to be a shareholder in the Company, MTDC shall simultaneously procure
the resignation of the Series A Director and Series C Director . The Series A
Director and Series C Director may not be removed by the Existing Shareholder or
any other party except when MTDC ceases to be a shareholder in the
Company. Any appointment or removal of the Series A Director
and/or Series C Director by MTDC shall be made in writing and shall
be delivered to the registered office of the Company.
The right
of appointment of the Series B Director shall include the right for PMSB to
remove such person at any time from such office and also the right to determine
from time to time the period which such person shall hold office as the Series B
Director. Upon PMSB ceasing to be a shareholder in the Company, PMSB
shall simultaneously procure the resignation of the Series B Director. The
Series B Director may not be removed by the Existing Shareholder or any other
party except when PMSB ceases to be a shareholder in the Company. Any
appointment or removal of the Series B Director by PMSB shall be made in writing
and shall be delivered to the registered office of the
Company.
Page
| 6
The
quorum at all meetings shall be at least four (4) Directors and must include one
(1) Series A Director (or his alternate) or Series C Director (or his alternate)
and one (1) Series B Director (or his alternate). If a quorum is not
present within forty-five (45) minutes after the time appointed for the
commencement of a meeting of the Board, that meeting shall be adjourned to the
same time, seven (7) days after that meeting at the same place, provided that at
such adjourned meeting (for the same agenda), the quorum shall be any three (3)
Directors and must include one (1) Series A Director (or his alternate) or one
(1) Series C Director ( or his alternate).
The
Directors may meet together either in person or by telephone, radio, video
conference or similar communication equipment or any other form of audio or
audio-visual instantaneous communication by which all persons participating in
the meeting are able to hear and be heard by all other participants and
participation in a meeting pursuant to this provision shall constitute presence
in person at such meeting.
The
Company’s Articles shall be amended to provide that a quorum of the Board must
include at least one (1) Series A Director or one (1) Series C Director,
including at any adjourned meeting.
|
6.3
|
Provisions
in respect of meetings
|
Any
Director may at any time request for a meeting to be convened, subject to the
Board meeting at least once quarterly, unless otherwise agreed to by a vote of a
majority of Directors including at least one vote from a Series A Director
or Series C Director and at least one (1) vote from a Series B
Director. The request for a meeting must be made in writing and delivered to the
company secretary of the Company.
Upon
receiving the request, the company secretary is to issue a notice, giving at
least seven (7) days’ prior written notice to all Directors and their
alternates. The notice shall set out the date, time, venue and the agenda or
matters to be discussed for the Board meeting. Such notice shall not
be required if all Directors are present or represented at the meeting or if the
absent Directors agree in writing to waive the requirement of such
notice.
So long
as a quorum is present throughout the meeting of the Board in accordance with
clause 6.2, all resolutions or decisions of the Board are to be by a simple
majority of all the Directors present and capable of voting at the meeting of
the Board.
A written
resolution or minute of a decision made by the Board which is signed by all the
Directors is regarded as valid and effectual as if it had been passed at a duly
convened Board meeting. Any such written resolution or minute may consist of
several documents (or facsimiles thereof) in like form or in one or more
counterparts, each signed by one or more of the Directors, and all counterparts
taken together constitute one document.
Page
| 7
|
6.6
|
No
shareholding requirement
|
The
Directors need not be shareholders of the Company and are not liable to retire
by rotation until removed/replaced by the Party nominating them.
The
operations of the Company will be managed by the Board, but the day to day
administration or management of the Company may be vested in a management
committee (“Management
Committee”) appointed by the Board from time to time who shall at all
times be responsible and subject to the control of the Board. The Management
Committee may comprise members of the Board.
The
parties acknowledge that as the Series A Director and Series C Director
are nominees of MTDC and that the Series B Director is a nominee of
PMSB, the Series A Director, Series C and the Series B Director shall be
entitled to report all matters concerning the Company, including but not limited
to matters discussed at any meeting of the Board, to MTDC and PMSB and their
shareholders respectively and that the Series A Director and Series C Director
may take advice and obtain instructions from MTDC whereas the Series B Director
may take advice and obtain instructions from PMSB.
The
Company agrees to indemnify and keep the Series A Director, Series C Director
and Series B Director indemnified, subject to section 140 of the
Act.
Annual
general meetings and extraordinary general meetings are to be held in accordance
with the provisions of the Act.
The
quorum for all general meetings is two (2) persons being present throughout the
meeting, consisting of the holders of the Shares or their respective proxy,
attorney or authorised representative.
|
7.3
|
Decisions
at meetings of the Shareholders
|
|
7.3.1
|
Ordinary
Resolution
|
So long
as a quorum is present throughout the meeting of the holders of the Shares in
accordance with clause 7.2, subject to clause 7.4, a simple majority vote of
those present and voting suffices to pass an ordinary
resolution.
Page
| 8
The
approval of the holders of the Shares by way of special resolution (as defined
in the Act) is required for matters which require a special resolution to be
passed as specified in the Act.
|
7.4
|
Shareholder
Reserve Matters
|
The
resolutions in relation to the following matters require approval from all
holders of Shares present and voting at a general meeting or by circular
resolution (signed by all the holders of the Shares):
|
|
(a)
|
any
amendment to the Memorandum and Articles of Association of the
Company;
|
|
|
(b)
|
the
appointment or removal of any Director or senior management of the Company
other than the Investors’ nominated directors;
and
|
|
|
(c)
|
the
declaration of dividends by the
Company.
|
|
8.
|
Business
of the Company
|
|
8.1
|
The
core business of the Company, unless otherwise agreed in writing by the
Investors, shall be developing, manufacturing, and distributing state of
the art solutions for Gene Analysis (Gene Expression, and Genotyping) and
stem cell research and cell biology (“Business”). The
Company will not engage in any other business which detracts from, or is
not complementary to, the Business.
|
|
8.2
|
The
Business is to be carried out in accordance with all applicable laws and
requirements.
|
|
8.3
|
The
Shareholders shall use its reasonable endeavours without being required to
incur any further financial obligation (other than as expressly set out in
this Agreement) to promote the interests of the Company. The Business is
to be conducted in the Shareholders’ and the Company’s best interests on
sound commercial profit-making principles so as to generate the maximum
achievable maintainable profits available for distribution, and otherwise
in accordance with the general principles as varied from time to time by
agreement in writing between the
Parties.
|
|
8.4
|
The
Company shall not, and the Existing Shareholder shall ensure that the
Company shall not, without the prior written consent of the Investors or
as expressly stated in this
Agreement:
|
|
|
(a)
|
cease
to conduct or carry on its Business substantially as now conducted and/or
acquire or dispose of or dilute any interest in any other business,
company, partnership or sole proprietorship;
and
|
|
|
(b)
|
purchase,
sell, mortgage or charge any substantial asset, or property or any
material interest in those assets or property or sell or dispose of the
whole or a substantial part of the undertaking and goodwill or the assets
of the Company.
|
Page
| 9
|
8.5
|
The
Existing Shareholder and/or the Company shall ensure
that:
|
|
|
(a)
|
the
Company shall at all times carry on and conduct its business in a proper
and efficient manner;
|
|
|
(b)
|
each
employee and consultant of the Company enters into a confidential
information and inventions agreement (in a form acceptable to the
Investors) with the Company;
|
|
|
(c)
|
the
Company shall submit to the Investors without being formally
requested:
|
|
|
(i)
|
an
annual budget and operating plan no later than sixty (60) days prior to
the commencement of each fiscal
year;
|
|
|
(ii)
|
an
annual business plan;
|
|
|
(iii)
|
audited
financial statements on an interim and annual basis;
and
|
|
|
(iv)
|
monthly
reports, including financial reports, bank statements and technical
reports.
|
The
obligation of the Company to furnish the information set out in paragraph 8.5(c)
will cease when the Company completes its IPO or becomes subject to the
reporting provisions of any applicable stock exchange requirements or all of the
Investors cease to be a shareholder in the Company.
|
|
(d)
|
at
all times keep true accurate and up to date books and records of all the
affairs of the Company;
|
|
|
(e)
|
supply
to the Investors such information relating to the Company as it may
require and without prejudice to the foregoing shall keep the Investors
fully and promptly informed as to all material developments regarding the
Company’s financial and business affairs and promptly notify the Investors
of any significant litigation or arbitration affecting or likely to affect
the Company and of any bona fide offer to purchase or subscribe any share
capital of the Company;
|
|
|
(f)
|
at
all times be adequately insured in respect of the assets of the company
which are of an insurable nature and obtain life insurance for the core
management team of the Company, the proceeds of which are payable to the
Company; and
|
|
|
(g)
|
upon
the Company’s receipt of reasonable notice, the Investors may have access
during normal business hours to relevant non-confidential information
and/or non-competitive information requested by the Investors including
the right to visit the Company’s business premises and inspect the
Company’s record books.
|
Page
| 10
|
9.1
|
New
Issues by Company
|
The
Shareholders agree that any new Shares and/or RCPS issued by the Company must be
with the prior approval of the Shareholders (“Offered Shares”) and the
Offered Shares shall be first offered to each of the Shareholders in proportion
to each of their shareholding in the Company at the time of the proposed new
issue other than:
|
|
(i)
|
for
the initial issuance of the Series A RCPS to MTDC and Series B RCPS to
PMSB, EEV and KMP;
|
|
|
(ii)
|
the
issuance of the Series C RCPS pursuant to the Series C Subscription
Agreement;
|
|
|
(iii)
|
the
Conversion Shares, where
applicable;
|
|
|
(iv)
|
Shares
issued pursuant to employee share option plans approved by a majority of
the Board;
|
|
|
(v)
|
Shares
issued for merger or acquisition transactions;
or
|
|
|
(vi)
|
any
issuance excepted from the right of first refusal by a majority of the
Board.
|
|
|
(vii)
|
any
issue of new Shares to the Existing Shareholder for consideration in cash
or in kind of up to 1,000,000 Shares, in addition to the initial share
capital of RM300,000 contributed by the Existing Shareholder and for the
avoidance of doubt, any such consideration in kind may comprise
capitalization of the value (or part of the value) of intellectual
property or other rights granted or undertakings pursuant to the product
licensing agreement between the Existing Shareholder and the Company based
on the valuation of USD10,000,000 agreed by the
parties.
|
|
9.2
|
Offer
to Shareholders
|
An offer
of the Offered Shares shall be made by notice specifying the number of new
Shares and/or RCPS offered, the subscription price and limiting a period (not
being less than thirty (30) days) within which the offer, if not accepted, will
be deemed to be declined. Upon the expiration of such period the Board shall
offer the Offered Shares so declined to the other Shareholders who have notified
their willingness to take all or any of such Offered Shares in accordance with
the terms of the offer and in case of competition, pro rata (as nearly as
possible) according to the number of Shares and RCPS held by the other
Shareholders.
The
Existing Shareholder and PMSB irrevocably confirm their waiver of all rights of
pre-emption whatsoever that they may have in connection with the issue and
conversion of the Series C RCPS to MTDC pursuant to the terms of this Agreement
and the Series C Subscription Agreement.
|
10.
|
Transfers,
Acquisitions and Disposal of Shares
|
|
10.1.1
|
The
rights of the Shareholders to sell, transfer, assign, pledge, charge,
encumber or otherwise dispose of their shareholding in the Company (or any
part thereof) shall be subject to the restrictions and provisions set out
below:
|
Page
| 11
|
|
(a)
|
In
the event any Shareholder desires to dispose of all or any portion of
their shareholding in the Company pursuant to a bona-fide third party
offer for the shares (“Transferor”), the
Transferor shall first afford the other Shareholders (“the Transferees”) a
right of first refusal with regard to those shares (“the Relevant Shares”) in
proportion to such Transferee’s shareholding in the Company. In this
regard, the Transferor shall give the Transferees written notice
(hereinafter called a “Transfer Notice”) of the
Transferor’s intention to dispose of the Relevant Shares, which notice
shall include the proposed transferee, the number of shares to be
transferred, the price per share, and the terms of
payment.
|
|
|
(b)
|
Upon
receipt of the Transfer Notice, the Transferees shall have the option, but
not the obligation, to purchase the Relevant Shares at either (i) the same
terms and conditions price for the Relevant Shares as set forth in the
Transfer Notice, or (ii) to request that the Shareholders appoint an
independent firm (at the cost and expense of the Transferor) to determine
the sale price per Relevant Share in accordance with the shareholders
funds or the net tangible assets (whichever is lower) of the Company as at
the date of the Transfer Notice (“the Prescribed
Price”).
|
|
|
(c)
|
In
the event the Transferees determine to accept the terms contained in the
Transfer Notice or upon the determination of and purchase of the Relevant
Shares at the Prescribed Price, the Relevant Shares shall promptly be
offered by the Transferor by notice in writing to the Transferees (and if
there is more than one Transferee, to each Transferee in proportion to
such Transferee’s shareholding in the Company) for purchase. Such offer
shall be open for acceptance at any time within the Prescribed Period. The
Prescribed Period shall commence on the date
that:
|
|
|
(i)
|
the
Transferees notify the Transferor of their acceptance of the offer to
purchase the Relevant Shares on the terms contained in the Transfer
Notice; or
|
|
|
(ii)
|
the
Prescribed Price is determined;
|
and will
expire sixty (60) days thereafter, after either (i) or (ii) as applicable. The
Transferee(s) so accepting the offer shall hereinafter be called the
“Purchaser(s)”.
|
|
(d)
|
If
there is more than one (1) Purchaser, each Purchaser shall have the right
to purchase the Relevant Shares pro rata in accordance with the ratio that
his shareholding bears to the aggregate shareholdings of all the
Purchasers provided that the said Purchaser must purchase all the Relevant
Shares offered to him. Upon acceptance of such offer by the Purchasers
within the Prescribed Period, the Transferor shall be bound to sell the
Relevant Shares to the Purchasers as set forth above. The sale and
purchase of the Relevant Shares shall be completed in accordance with the
provisions herein.
|
|
|
(e)
|
If
the offer of the Relevant Shares shall not be accepted by the Transferees,
then the Transferor shall be at liberty to transfer or dispose of the
Relevant Shares within a period of three (3) months from the expiry of the
Prescribed Period to the person identified in the Transfer Notice and in
accordance with the terms thereof, subject to Clause 10.1.2
below.
|
Page
| 12
|
|
(f)
|
Any
transfer, disposal or sale of shares contemplated by this Clause 10.1.1
shall be subject to the approval(s) of the Public Authorities should such
approval be required in law or in practice. Completion and payment of the
Prescribed Price shall take place not less than three (3) days nor more
than ten (10) Business Days after the date of the receipt of such
approval(s) of the Public
Authorities.
|
|
|
(g)
|
Any
transfer, disposal or sale of shares contemplated by Clause 10.1.1(e) to a
third party purchaser shall be further subject to such third party
purchaser entering into a deed or other suitable documentation agreeing to
be bound by all the terms of this
Agreement.
|
|
|
(h)
|
Notwithstanding
anything contained herein, the restrictions on transfer of shares
contained in this Clause 10 shall not apply in the case where the entire
shareholdings or part thereof is to be transferred by MTDC to any of its
holding company, subsidiaries or associated companies or any such transfer
undertaken by MTDC pursuant to any internal restructuring scheme of MTDC
and the consents of the other shareholders of the Company are deemed to be
given for such transfer of shares by MTDC pursuant to this
Clause.
|
|
|
(i)
|
The
procedures and pre-emption rights under this Clause 10 may be waived in
writing by the Shareholders.
|
|
10.1.2
|
Pursuant
to Clause 10.1.1(e), if the Existing Shareholder wishes to sell its shares
to a third party, the Existing Shareholder shall ensure that the Investors
be entitled (but not obliged) to sell any part of its holding of Shares to
the third party on no less favourable terms and conditions as are
applicable to the Existing Shareholder. Upon any exercise by
the Investors of this entitlement within thirty (30) days from the date of
notice by the Existing Shareholder of such entitlement of the Investors,
the Existing Shareholder shall not transfer or sell any of its shares to
the third party unless the relevant shares of Investors are so purchased
by the third party.
|
|
10.1.3
|
All
third parties who acquire shares in the Company under this Clause 10shall
enter into a deed of ratification and accession under which the third
party shall agree to be bound by the obligations, and shall be entitled to
the benefit, of this Agreement.
|
|
11.1
|
Investors’
Put Right for shares in the Existing
Shareholder
|
The
Existing Shareholder has granted to MTDC an option to sell all the Series A RCPS
held by MTDC to the Existing Shareholder upon the terms and conditions of the
Put Agreement entered into between the Existing Shareholder and
MTDC.
Page
| 13
|
11.2
|
Investors’
Put Option for Series A RCPS or Conversion
Shares
|
MTDC
shall have the option to require the Existing Shareholder to purchase all (but
not less than all) of the Conversion Shares or Series A RCPS held by MTDC, upon
thirty (30) days’ notice in writing to the Existing Shareholder. The price
payable for each Conversion Share shall be calculated based on the formula for
the issue price per Conversion Share set out in paragraph 5 of Schedule 1 of
this Agreement whereas the price payable for each Series A RCPS is USD2.25, such
price compounded at the rate of 8% per annum with yearly rests, up to the date
of exercise of the option, and at the discretion of MTDC, may be satisfied by
either cash or the issuance of shares in the Existing Shareholder. The option
shall be exercisable as follows:
|
|
(a)
|
any
time after the Initial Closing of the Series A Subscription Agreement for
as long as MTDC is the holder of Series A RCPS in the Company, in the
event there is a material breach or default by the Company or the Existing
Shareholder in any of their representations, warranties, undertakings,
covenants and obligations under this Agreement which has not been remedied
after thirty (30) days written notice of such material breach or default;
or
|
|
|
(b)
|
any
time between 1 January 2011 and 31 December 2011 and subject to the
following:
|
|
|
(i)
|
the
share price of the Existing Shareholder’s shares is below USD2.25;
or
|
|
|
(ii)
|
due
to any breach or default attributable to the Existing Shareholder, the
Investor is unable to exercise its rights under the Put
Agreement.
|
This
clause applies only to any Conversion Shares resulting from the conversion of
the Series A RCPS.
|
12.
|
Duration
and Termination
|
Subject
to the provisions of this Clause 12, this Agreement shall take effect without
limit in point of time. If the Investors or the Existing Shareholder
sells or transfers all of its shares in the Company or if the Investors redeems
or exchanges all the RCPS to the shares in the Existing Shareholder, in
accordance with the provisions of this Agreement or the Articles (to the extent
not inconsistent with this Agreement) or the Put Agreement respectively, it
shall be released from all of its rights and obligations under this Agreement
and cease to be a party to this Agreement, and all obligations of that Party and
all entitlements and requirements relating to that Party under this Agreement
will cease. If following any such sale, transfer, redemption or
exchange, two (2) or more parties continue to be bound by this Agreement, this
Agreement shall continue in full force and effect as between those
parties.
|
13.
|
Previous
Agreements and Prevalence of
Agreement
|
|
13.1
|
This
Agreement constitutes the entire agreement between the Parties with
respect of the matters dealt with here and the Parties hereby mutually
agree and confirm that the Shareholders’ Agreement, DA and KMP DA shall be
terminated with effect from the date of this Agreement and be superseded
by this Agreement.
|
Page
| 14
|
13.2
|
This
Agreement and the documents referred to in its provisions are in
substitution for all previous agreements between all or any of the Parties
and contain the whole agreement between the Parties relating to the
subject matter of this Agreement.
|
|
13.3
|
If,
during the continuance of this Agreement, there is any conflict between
this Agreement and the Articles, the provisions of this Agreement shall
prevail between the Parties. In the event of such conflict
arising, the Parties shall procure and take all necessary steps including
effecting such alteration to the Articles as may be necessary to resolve
such conflict.
|
|
14.
|
Remedy
on an Event of Default
|
|
14.1
|
Each
of the following will be regarded as an Event of
Default:
|
|
|
(a)
|
any
of the Shareholders committing a breach of its obligations under this
Agreement and, in the case of a breach capable of remedy, failing to
remedy the same within twenty one (21) days of being specifically required
in writing so to do by the other Shareholder;
or
|
|
|
(b)
|
any
distress, execution, sequestration or other process being levied or
enforced upon or sued out against the property of any of the Shareholders
which is not discharged within ten (10) days;
or
|
|
|
(c)
|
any
encumbrancer taking possession of or a receiver or trustee being appointed
over the whole or any part of the undertaking, property or assets of any
of the Shareholders; or
|
|
|
(d)
|
the
making of an order or the passing of a resolution for the winding up of
any of the Shareholders, otherwise than for the purpose of a
reconstruction or amalgamation without insolvency or previously approved
by the other Shareholder (such approval not to be unreasonably
withheld).
|
|
14.2
|
In
the event of an Event of Default taking
place,
|
|
|
(a)
|
the
non-defaulting Shareholder shall be entitled to terminate this Agreement;
or
|
|
|
(b)
|
the
deadlock provisions referred to in clause 16 shall
apply,
|
|
|
without
prejudice to any rights or remedies the non-defaulting Shareholder may
have against the defaulting Shareholder for any antecedent
breach.
|
|
14.3
|
Notwithstanding
any provision in this Agreement to the contrary, this Agreement shall
remain in full force and effect for so long as shall be necessary to
fulfil and give effect to the arrangements and undertakings contained in
this Agreement.
|
|
14.4
|
Termination
of this Agreement for any cause in accordance with the provisions of this
Agreement shall not release any Shareholder from any liability which at
the time of termination has already accrued to the other or which
thereafter may accrue in respect of any act or omission prior to such
termination or which has accrued in consequence of this
clause.
|
Page
| 15
Parties
shall:
|
|
(a)
|
ensure
the confidentiality of this Agreement and the transactions contemplated in
this Agreement;
|
|
|
(b)
|
not
disclose any provision of this Agreement
except:
|
|
|
(i)
|
where
required by law or any relevant governmental regulatory body or competent
authority;
|
|
|
(ii)
|
to
any financier or professional adviser acting for the party;
or
|
|
|
(iii)
|
the
information is public knowledge otherwise than as a consequence of breach
of this Clause.
|
The
Existing Shareholder and the Company are permitted to disclose the names of the
Parties or make reference to the Parties contributions to the Company. For
purposes deemed necessary for the furtherance of the Business, the
confidentiality obligation in this Agreement does not cover the names of the
Parties and their respective interests in the Company.
This
restriction continues to apply after the expiration or sooner termination of
this Agreement without limit in point of time but ceases to apply to information
or knowledge which may properly come into the public domain through no fault of
the Party so restricted.
If the
Shareholders or their respective representatives are unable to reach agreement
in relation to any reserved matter provided for in Clause 7.4 or there is an
Event of Default pursuant to Clause 14 or otherwise in relation to any matter of
material importance to the future conduct of the Business, the meeting at which
such resolution is tabled shall be adjourned for 30 days (or such other number
of days as the Parties may agree) during which the Parties, through Xxxxxx
Xxxxxx and the Chief Executive Officer of MTDC, shall mutually discuss in order
to resolve the deadlock. Xxxxxx Xxxxxx and the
Chief Executive Officer of MTDC shall endeavour to resolve any disagreement in
the best interest of the Company as a whole.
Each
party shall execute and do all such documents and things as are necessary to
carry this Agreement into effect or to give full effect to this
Agreement.
If a
Party does not comply with its obligations under this Agreement, the other Party
is entitled to the remedy of specific performance and injunctive relief (as may
be applicable), and monetary compensation by itself is not an adequate
remedy.
Page
| 16
The
rights which each Party has under this Agreement shall not be prejudiced or
restricted by any delay in exercising or failure to exercise any right or remedy
under this Agreement. Unless otherwise agreed in writing, no waiver
by any Party in respect of a breach shall operate as a waiver in respect of any
subsequent breach.
|
19.2
|
Cumulative
rights and remedies
|
The
rights and remedies provided in this Agreement are in addition to, and do not
exclude or limit, any rights or remedies provided by law.
This
Agreement shall not be varied unless the variation is expressly agreed in
writing by each Party.
If any
provision of this Agreement is void or unenforceable, by operation of law or by
any reason whatsoever, it shall be regarded as deleted from this Agreement, and
the remaining provisions shall continue to apply.
Notwithstanding
the completion of the transaction contemplated in this Agreement, the provisions
of this Agreement shall continue to survive or subsist so long as may be
necessary for the purpose of giving effect to each of them.
Time
wherever mentioned in this Agreement shall be of the essence of this
Agreement.
Nothing
in this Agreement shall create, or be regarded as creating, a partnership or the
relationship of employer and employee between the Parties. Neither Party has any
authority to bind the other in any way.
Each
Party shall bear its own costs (including legal fees) and expenses in respect of
the preparation and execution of this Agreement.
Page
| 17
|
25.
|
Assignment;
Successors
|
Parties
shall not assign or otherwise deal with its respective rights or benefits under
this Agreement without the prior written consent of the other
Parties.
|
25.2
|
Successors
and assigns
|
This
Agreement shall be binding upon the Parties and their respective successors,
permitted assigns and personal representatives.
| |
Without
affecting any other effective mode of service, any notice given under this
Agreement:
|
|
|
(a)
|
must
be in writing and may be delivered personally or sent by registered post
to the intended recipient at the address shown below or the address last
notified by the intended recipient to the
sender:
|
For the
Investors:
MTDC
Level
8-9, Menara Yayasan Tun Razak,
Xxxxx
Xxxxx Xxxxxxx,
00000
Xxxxx Xxxxxx
Attn:
Norhalim Bin Yunus , Chief Executive Officer
Tel:
00-0000 0000
Fax:
00-0000 0000
PMSB
5th
Floor, Bangunan XXXX,
Xxxxx
Xxxxxxxx, Xxxxxxxxx Xxxxxxx,
00000
Xxxxx Xxxxxx
Attn:
Darawati Hussain
Tel: x000
0000 0000
Fax: x000
0000 0000
or
c/o
Trupartners
Sdn Bhd
X-0-0,
Xxxxx X,
Xxxxx
Damas,
Page
| 18
00 Xxxxx
Xxx Xxxxxxxx 0,
00000
Xxxxx Xxxxxx
Attn:
Norazharuddin Abu Talib
Tel: x000
0000 0000
Fax: x000
0000 0000
For the
Existing Shareholder:
Wafergen
Bio-Systems Inc
0000
Xxxxx Xxxxx Xxxxxxx
Xxxxxxx,
XX 00000, XXX
Attn:
Xxxxxx Xxxxxx
Tel: x0
(000) 000-0000
Fax: x0
(000) 000-0000
For the
Company:
Wafergen Biosystems (M) Sdn
Bhd
Suite
B.3(2), Ground Floor
KHTP
Business Centre
KHTP,
09000 Kulim
Kedah
Darul Aman, Malaysia
Tel:
x0000 000 0000
Fax: x000
000 0000
Attn:
Nazri Said
|
|
(c)
|
will
be taken to be duly given or made:
|
|
|
(i)
|
(in
the case of delivery in person) when delivered, received or left at the
above address; and
|
|
|
(ii)
|
(in
the case of delivery by registered post) 48 hours after posting, and in
proving service it shall only be necessary to prove that the communication
was contained in an envelop which was duly addressed and posted in
accordance with this Clause,
|
but if
delivery, receipt or service occurs, or will be taken to occur, on a day on
which business is not generally carried on in the place to which the
communication is sent or is later than 4 p.m. (local time) it will be taken to
have been duly given or made at the commencement of business on the next day on
which business is generally carried on in the place.
Page
| 19
This
Agreement is the entire agreement between the Parties in respect of its subject
matter and supersedes all previous agreements with respect to its subject
matter.
This
Agreement may be executed in any number of counterparts, and all counterparts
taken together constitute one and the same instrument.
|
29.
|
Governing
Law and Jurisdiction
|
This
Agreement is governed by the laws of Malaysia, and each party submits to the
non-exclusive jurisdiction of the courts exercising jurisdiction in
Malaysia.
Page
| 20
SCHEDULE
1
Principal
Terms of the Series A RCPS
|
1.
|
Subscription
Price and par value
|
The
subscription price for each Series A RCPS shall be Ringgit Malaysia equivalent
to USD2.25 calculated at the prevailing exchange rate on the on the date payment
of the Subscription Price is effected . Each Series A RCPS shall have
a par value of RM0.01.
Each
Series A RCPS shall be issued at a premium being the difference between the
Subscription Price and the par value of RM0.01.
There is
no specific dividend rate attached to the Series A RCPS and the Company is not
obliged to declare and pay any dividend while the Investors are holding the
Series A RCPS.
|
4.
|
Liquidation
Preference
|
In the
event of any liquidation, dissolution or winding up of the Company, the holders
of the Series A RCPS will be entitled to receive only in preference to the
holders of Shares, and not the Series B RCPS (which rank pari passu for the
purposes of this provision), the relevant Subscription Price paid for the Series
A RCPS plus all accrued but unpaid dividends and dividends in arrears, if
any.
Each
holder of the Series A RCPS will have the right, at the option of the holder at
any time, to convert all or part of the Series A RCPS into such number of Shares
as may be determined in accordance with the following formula:
|
|
A
|
represents
the aggregate original investment amount in USD (comprising the
subscription moneys paid to the Company for subscription for RCPS) of the
holder in the Company
|
|
|
B
|
represents
the aggregate original investment amount in USD (comprising the
subscription moneys paid to the Company for subscription for RCPS) of all
other holders (past and present) of RCPS in the
Company
|
Page
| 21
The
conversion is to be effected by and subject to the redemption of the Series A
RCPS from funds legally available for distribution at the redemption price of
USD2.25 per Series A RCPS and the issuance of such number of new Shares to the
holder with the issue price based on the following formula:
|
Issue
price per Share
|
=
|
A
| |
|
|
|
N
| |
and
applying the redemption monies towards such issue price.
PROVIDED
THAT
|
|
(i)
|
where
N includes any fractions, N is to be rounded downwards to the nearest
whole number
|
|
|
(ii)
|
where
the number of new Shares to be issued includes any fractions, such number
of new Shares is to be rounded downwards to the nearest whole
number
|
|
|
(iii)
|
where
the issue price includes any fractions of sen, the issue price is to be
rounded downwards to the nearest
sen
|
|
|
For
the purposes of this provision:
|
|
|
(a)
|
the
amount in USD of the investment amount is based on the value in USD of the
subscription moneys as at the respective date(s) of the relevant
subscription(s).
|
|
|
(b)
|
for
the avoidance of doubt, where any RCPS has been held by more than one
holder, such RCPS and investment amount in relation to the RCPS, is to be
counted only once.
|
To effect
the above conversion, a conversion notice shall be sent by the holder(s) of the
Series A RCPS to the Company not less than thirty (30) days before the intended
date of conversion. Such notice shall be in writing and shall fix the
date and the time for the conversion.
The
Company may from time to time consult with, and make proposals to, the holder(s)
of Series A RCPS in relation to the exercise of the holder(s)’ entitlement to
convert the Series A RCPS.
Completion
of the conversion of the Series A RCPS into Conversion Shares shall be effected
at the registered office of the Company unless agreed otherwise by the holder(s)
of the Series A RCPS and the Company. On the date fixed for
conversion, the holder(s) of the Series A RCPS shall deliver to the Company the
share certificate(s) for the relevant Series A RCPS in exchange for share
certificates in relation to the relevant amount of Conversion Shares resulting
from the conversion of those Series A RCPS. If any share certificate
so delivered to the Company relates to any Series A RCPS which are not to be
converted on that day, a fresh share certificate for those Series A RCPS shall
be immediately issued by the Company to such holder(s).
Page
| 22
The
holders of the Series A RCPS may at any time after 31 December 2011, subject to
the completion of the PMSB Subsequent Closing or EEV Subsequent Closing (where
relevant), by giving a thirty (30) day notice of redemption in such form as may
be acceptable to the Company (“Notice of Redemption”), redeem
any or all Series A RCPS registered in the name of the holder of the Series A
RCPS. The RCPS will be redeemable from funds legally available for distribution
at the redemption price (“Redemption Price”) which
comprises a par value of RM0.01 with redemption premium equivalent to the
difference between (i) the aggregate of the Subscription Price and such price
multiplied at the rate of 20% per annum prorated by day, up to the date of the
redemption based on a 365-days year (and without any compounding or addition to
the principal Subscription Price) and (ii) the par value of RM0.01 per Series A
RCPS plus all accrued but unpaid dividends and dividends in arrears, if
any.
All
redemption of the Series A RCPS shall be effected at the registered office of
the Company unless agreed otherwise by the holder(s) of the Series A RCPS and
the Company. On the date fixed for redemption, the holder(s) of the
Series A RCPS shall deliver to the Company the share certificate(s) for the
relevant Series A RCPS in exchange for payment in cash (by way of bank draft or
any other manner acceptable to the holder(s)) by the Company of the aggregate
Redemption Price for the time being payable for those Series A
RCPS. If any share certificate so delivered to the Company relates to
any Series A RCPS which are not to be redeemed on that day, a fresh share
certificate for those Series A RCPS shall be issued by the Company to such
holder(s).
No Series
A RCPS redeemed by the Company shall be capable of reissue.
The
holder of the Series A RCPS will be entitled to the voting rights as referred to
in Section 148(2) of the Act.
Without
the approval of the holders of at least a majority of the Series A RCPS, the
Company will not take any action, whether by merger, consolidation or otherwise,
that:
|
|
(a)
|
effects
a sale, lease, license or other disposition of all or substantially all of
the Company’s assets, property or business or undertakings in excess of
RM250,000.00,
|
|
|
(b)
|
effects
or enters into any agreement regarding any transaction, or series of
transactions, which results in the holders of the Series A RCPS prior to
the transaction owning less than 50% of the voting power of the Company’s
Series A RCPS after the
transaction(s),
|
|
|
(c)
|
alters
or changes the rights, preferences or privileges of the Series A
RCPS,
|
|
|
(d)
|
increases
or decreases the number of authorized Series A
RCPS,
|
Page
| 23
|
|
(e)
|
authorises
the issuance of securities having a preference over or on a parity with
the Series A RCPS,
|
|
|
(f)
|
changes
the number of directors,
|
|
|
(g)
|
amends,
modifies or repeals the Memorandum of Association and/or Articles of the
Company in a manner which adversely affects the holders of the Series A
RCPS,
|
|
|
(h)
|
effects
any recapitalization or reorganization, or any voluntary or involuntary
liquidation under applicable bankruptcy or reorganization legislation, or
any dissolution, liquidation, or winding up of the
Company,
|
|
|
(i)
|
declares
or pays dividends on or makes any distributions with respect to any share
capital of the Company.
|
For
purposes of these protective provisions, any reference to the Company will be
deemed to include any subsidiary of the Company.
The
rights attached to the Series A RCPS shall not be varied, modified or deleted
unless in accordance with paragraph 9 above.
[The remainder of this page is
intentionally left blank]
Page
| 24
SCHEDULE
2
Representations
and Warranties
|
1.
|
Representations
and Warranties by the Investors
|
The
Investors warrant to the Company as follows.
|
|
1.1
|
Capacity and
Authority
|
The
Investors are duly incorporated and validly exist under the laws of Malaysia and
has the power to own its assets and carry on its business as now being
conducted.
|
|
1.2
|
Power to execute this
Agreement
|
|
|
(a)
|
The
Investors have the right, power and authority, and have taken or will take
all action necessary, to validly execute, deliver and exercise its right,
and perform its obligations under this
Agreement;
|
|
|
(b)
|
Other
than those set out in this Agreement, no other consent, approval,
authorization or other order of any court, regulatory body, administrative
agency or other order of any other governmental body is required for the
execution and delivery by the Investors of this Agreement or the
performance by the Investors of the transactions contemplated under this
Agreement;
|
|
|
(c)
|
This
Agreement is a valid and binding obligation of the Investors and is
enforceable against the Investors in accordance with its
terms;
|
|
|
(d)
|
The
execution, delivery and performance of this Agreement will not violate any
judgment, order or decree to which the Investors are subject and will not
be inconsistent with any constitutional documents or contracts to which
the Investors are a party to or otherwise binding on the Investors;
and
|
|
|
(e)
|
There
is no action, proceeding, claim or investigation pending against the
Investors before any court or administrative authority, which, if
determined against the Investors, may reasonably be expected to have a
material adverse effect on the Investors’ ability to perform the
obligations hereunder.
|
|
2.
|
Representations
and Warranties by the Existing Shareholder and the
Company
|
The
Existing Shareholder and the Company warrant to the Investors as
follows.
|
|
2.1
|
Capacity and
Authority
|
The
Company is duly incorporated and validly exists under the laws of Malaysia and
has the power to own its assets and carry on the Business.
Page
| 25
|
|
2.2
|
Power to execute this
Agreement
|
|
|
(a)
|
The
Existing Shareholder and Company have the right, power and authority, and
has taken or will take all action necessary, to validly execute, deliver
and exercise its right, and perform its obligations under this
Agreement;
|
|
|
(b)
|
Other
than those set out in this Agreement, no other consent, approval,
authorization or other order of any court, regulatory body, administrative
agency or other order of any other governmental body is required for the
execution and delivery by the Existing Shareholder and the Company of this
Agreement or the performance by the Existing Shareholder and the Company
of the transactions contemplated under this
Agreement;
|
|
|
(c)
|
This
Agreement is a valid and binding obligation of the Existing Shareholder
and the Company and after fulfillment of the conditions precedent is
enforceable against the Existing Shareholder and the Company in accordance
with its terms;
|
|
|
(d)
|
The
execution, delivery and performance of this Agreement will not violate any
judgment, order or decree to which the Existing Shareholder and the
Company is subject and save as otherwise disclosed, will not be
inconsistent with any constitutional documents or contracts to which the
Existing Shareholder and/or the Company is a party to or otherwise binding
on the Existing Shareholder and/or the Company;
and
|
|
|
(e)
|
There
is no action, proceeding, claim or investigation pending against the
Existing Shareholder and/or the Company before any court or administrative
authority, which, if determined against the Existing Shareholder and/or
the Company, may reasonably be expected to have a material adverse effect
on the Existing Shareholder and the Company’s ability to perform the
obligations hereunder.
|
[The remainder of this page is
intentionally left blank]
Page
| 26
SCHEDULE
3
Principal
Terms of the Series B RCPS
|
1.
|
Subscription
Price and par value
|
The
subscription price for each Series B RCPS shall be Ringgit Malaysia equivalent
to USD2.25 calculated at the prevailing exchange rate on the on the date payment
of the Subscription Price is effected. Each Series B RCPS shall have
a par value of RM0.01.
Each
Series B RCPS shall be issued at a premium being the difference between the
Subscription Price and the par value of RM0.01.
There is
no specific dividend rate attached to the Series B RCPS and the Company is not
obliged to declare and pay any dividend while the Investors are holding the
Series B RCPS.
|
4.
|
Liquidation
Preference
|
In the
event of any liquidation, dissolution or winding up of the Company, the holders
of the Series B RCPS will be entitled to receive only in preference to the
holders of Shares, and not the Series A RCPS (which rank pari passu for the
purposes of this provision), the relevant Subscription Price paid for the Series
B RCPS (subject to adjustments for share dividends, splits, combinations and
similar events plus accrued dividends (other than any special dividends), if
any.
Each
holder of the Series B RCPS will have the right, at the option of the holder at
any time, to convert all or part of the Series B RCPS into such number of Shares
as may be determined in accordance with the following formula:
|
|
A
|
represents
the aggregate original investment amount in USD (comprising the
subscription moneys paid to the Company for subscription for RCPS) of the
holder in the Company
|
|
|
B
|
represents
the aggregate original investment amount in USD (comprising the
subscription moneys paid to the Company for subscription for RCPS) of all
other holders (past and present) of RCPS in the
Company
|
Page
| 27
The
conversion is to be effected by and subject to the redemption of the Series B
RCPS from funds legally available for distribution at the redemption price of
USD2.25 per Series B RCPS and the issuance of such number of new Shares to the
holder with the issue price based on the following formula:
|
Issue
price per Share
|
=
|
A
| |
|
|
|
N
| |
and
applying the redemption monies towards such issue price.
PROVIDED
THAT
|
|
(i)
|
where
N includes any fractions, N is to be rounded downwards to the nearest
whole number
|
|
|
(ii)
|
where
the number of new Shares to be issued includes any fractions, such number
of new Shares is to be rounded downwards to the nearest whole
number
|
|
|
(iii)
|
where
the issue price includes any fractions of sen, the issue price is to be
rounded downwards to the nearest
sen
|
For the
purposes of this provision:
|
|
(a)
|
the
amount in USD of the investment amount is based on the value in USD of the
subscription moneys as at the respective date(s) of the relevant
subscription(s).
|
|
|
(b)
|
for
the avoidance of doubt, where any RCPS has been held by more than one
holder, such RCPS and investment amount in relation to the RCPS, is to be
counted only once.
|
To effect
the above conversion, a conversion notice shall be sent by the holder(s) of the
Series B RCPS to the Company not less than thirty (30) days before the intended
date of conversion. Such notice shall be in writing and shall fix the
date and the time for the conversion.
The
Company may from time to time consult with, and make proposals to, the holder(s)
of Series B RCPS in relation to the exercise of the holder(s)’ entitlement to
convert the Series B RCPS.
Completion
of the conversion of the Series B RCPS into Conversion Shares shall be effected
at the registered office of the Company unless agreed otherwise by the holder(s)
of the Series B RCPS and the Company. On the date fixed for
conversion, the holder(s) of the Series B RCPS shall deliver to the Company the
share certificate(s) for the relevant Series B RCPS in exchange for share
certificates in relation to the relevant amount of Conversion Shares resulting
from the conversion of those Series B RCPS. If any share certificate
so delivered to the Company relates to any Series B RCPS which are not to be
converted on that day, a fresh share certificate for those Series B RCPS shall
be immediately issued by the Company to such holder(s).
Page
| 28
The
holders of the Series B RCPS may at any time after 31 December 2011, subject to
the completion of the PMSB Subsequent Closing or EEV Subsequent Closing (where
relevant), by giving a thirty (30) day notice of redemption in such form as may
be acceptable to the Company (“Notice of Redemption”), redeem
any or all Series B RCPS registered in the name of the holder of the Series B
RCPS. The RCPS will be redeemable from funds legally available for distribution
at the redemption price (“Redemption Price”) which
comprises a par value of RM0.01 with redemption premium equivalent to the
difference between (i) the aggregate of the Subscription Price and such price
multiplied at the rate of 20% per annum prorated by day, up to the date of the
redemption based on a 365-days year (and without any compounding or addition to
the principal Subscription Price) and (ii) the par value of RM0.01 per Series B
RCPS plus all accrued but unpaid dividends and dividends in arrears, if
any.
All
redemption of the Series B RCPS shall be effected at the registered office of
the Company unless agreed otherwise by the holder(s) of the Series B RCPS and
the Company. On the date fixed for redemption, the holder(s) of the
Series B RCPS shall deliver to the Company the share certificate(s) for the
relevant Series B RCPS in exchange for payment in cash (by way of bank draft or
any other manner acceptable to the holder(s)) by the Company of the aggregate
Redemption Price for the time being payable for those Series B
RCPS. If any share certificate so delivered to the Company relates to
any Series B RCPS which are not to be redeemed on that day, a fresh share
certificate for those Series B RCPS shall be issued by the Company to such
holder(s).
No Series
B RCPS redeemed by the Company shall be capable of reissue.
The
holder of the Series B RCPS will be entitled to the voting rights as referred to
in Section 148(2) of the Act.
Without
the approval of the holders of at least a majority of the Series B RCPS, the
Company will not take any action, whether by merger, consolidation or otherwise,
that:
|
|
(a)
|
effects
a sale, lease, license or other disposition of all or substantially all of
the Company’s assets, property or business or undertakings in excess of
RM250,000.00,
|
|
|
(b)
|
effects
or enters into any agreement regarding any transaction, or series of
transactions, which results in the holders of the Series B RCPS prior to
the transaction owning less than 50% of the voting power of the Company’s
Series B RCPS after the
transaction(s),
|
|
|
(c)
|
alters
or changes the rights, preferences or privileges of the Series B
RCPS,
|
|
|
(d)
|
increases
or decreases the number of authorized Series B
RCPS,
|
Page
| 29
|
|
(e)
|
authorises
the issuance of securities having a preference over or on a parity with
the Series B RCPS,
|
|
|
(f)
|
changes
the number of directors,
|
|
|
(g)
|
amends,
modifies or repeals the Memorandum of Association and/or Articles of the
Company in a manner which adversely affects the holders of the Series B
RCPS,
|
|
|
(h)
|
effects
any recapitalization or reorganization, or any voluntary or involuntary
liquidation under applicable bankruptcy or reorganization legislation, or
any dissolution, liquidation, or winding up of the
Company,
|
|
|
(i)
|
declares
or pays dividends on or makes any distributions with respect to any share
capital of the Company.
|
For
purposes of these protective provisions, any reference to the Company will be
deemed to include any subsidiary of the Company.
The
rights attached to the Series B RCPS shall not be varied, modified or deleted
unless in accordance with paragraph 9 above.
Page
| 30
SCHEDULE
4
Principal
Terms of the Series C RCPS
|
1.
|
Subscription
Price and par value
|
The
subscription price for each Series C RCPS at the Initial Closing shall be
Ringgit Malaysia equivalent to USD1.5462 calculated at the prevailing exchange
rate on the date of payment of the Initial Subscription Price is effected. The
subscription price for each Series C RCPS at the Subsequent Closing shall be
Ringgit Malaysia equivalent to USD2.3193 calculated at the prevailing exchange
rate on the date of payment of the Subsequent Subscription Price is effected.
Each Series C RCPS shall have a par value of RM0.01.
Each
Series C RCPS shall be issued at a premium being the difference between the
Initial Subscription Price or Subsequent Subscription Price (as the case may be)
and the par value of RM0.01.
There is
no specific dividend rate attached to the Series C RCPS and the Company is not
obliged to declare and pay any dividend while the Investor is holding the Series
C RCPS.
|
4.
|
Liquidation
Preference
|
In the
event of any liquidation, dissolution or winding up of the Company, the holders
of the Series C RCPS will be entitled to receive only in preference to the
holders of Shares, and not the Series A RCPS and Series B RCPS (which rank pari
passu for the purposes of this provision), the relevant Initial Subscription
Price and Subsequent Subscription Price (as the case may be) paid for the Series
C RCPS plus all accrued but unpaid dividends and dividends in arrears, if
any.
Each
holder of the Series C RCPS will have the right, at the option of the holder at
any time, to convert all or part of the Series C RCPS into such number of Shares
at a conversion ratio of one hundred-to-one (100 Series C RCPS : 1
Share).
The
conversion is to be effected by way of consolidating the par value of every one
hundred Series C RCPS of RM0.01 each, into the total par value of RM1.00 of each
Share.
To effect
the above conversion, a conversion notice shall be sent by the holder(s) of the
Series C RCPS to the Company not less than thirty (30) days before the intended
date of conversion. Such notice shall be in writing and shall fix the
date and the time for the conversion.
The
Company may from time to time consult with, and make proposals to, the holder(s)
of Series C RCPS in relation to the exercise of the holder(s)’ entitlement to
convert the Series C RCPS.
Page
| 31
Completion
of the conversion of the Series C RCPS into Conversion Shares shall be effected
at the registered office of the Company unless agreed otherwise by the holder(s)
of the Series C RCPS and the Company. On the date fixed for
conversion, the holder(s) of the Series C RCPS shall deliver to the Company the
share certificate(s) for the relevant Series C RCPS in exchange for share
certificates in relation to the relevant amount of Conversion Shares resulting
from the conversion of those Series C RCPS. If any share certificate
so delivered to the Company relates to any Series C RCPS which are not to be
converted on that day, a fresh share certificate for those Series C RCPS shall
be immediately issued by the Company to such holder(s).
|
7.1
|
The
Company may redeem any or all Series C RCPS registered in the name of the
holder of the Series C RCPS at any time if the Company is prohibited from
granting a loan to the Existing Shareholder using the proceeds from the
issuance of the Series C RCPS due to legal or regulatory restrictions in
Malaysia, by giving a Notice of Redemption. The Series C RCPS will be
redeemable from funds legally available for distribution at the redemption
price (“Redemption
Price”) which comprises a par value of RM0.01 with redemption
premium equivalent to the difference between (i) the aggregate of the
Initial Subscription Price or Subsequent Subscription Price (as the case
may be) and such price multiplied at the rate of 5% per annum prorated by
day, up to the date of the redemption based on a 365-days year (and
without any compounding or addition to the principal Initial Subscription
Price or Subsequent Subscription Price (as the case may be)) and (ii) the
par value of RM0.01 per Series C RCPS plus all accrued but unpaid
dividends and dividends in arrears, if
any
|
|
7.2
|
All
redemption of the Series C RCPS shall be effected at the registered office
of the Company unless agreed otherwise by the holder(s) of the Series C
RCPS and the Company. On the date fixed for redemption, the
holder(s) of the Series C RCPS shall deliver to the Company the share
certificate(s) for the relevant Series C RCPS in exchange for payment in
cash (by way of bank draft or any other manner acceptable to the
holder(s)) by the Company of the aggregate Redemption Price for the time
being payable for those Series C RCPS. If any share certificate
so delivered to the Company relates to any Series C RCPS which are not to
be redeemed on that day, a fresh share certificate for those Series C RCPS
shall be issued by the Company to such
holder(s).
|
No Series
C RCPS redeemed by the Company shall be capable of reissue.
The
holder of the Series C RCCPS will be entitled to the voting rights as referred
to in Section 148(2) of the Act.
Without
the approval of the holder of the Series C RCPS, the Company will not take any
action, whether by merger, consolidation or otherwise, that:
Page
| 32
|
|
(a)
|
effects
a sale, lease, license or other disposition of all or substantially all of
the Company’s assets, property or business or undertakings in excess of
RM250,000.00,
|
|
|
(b)
|
effects
or enters into any agreement regarding any transaction, or series of
transactions, which results in the holders of the Series C RCPS prior to
the transaction owning less than 50% of the voting power of the Company’s
Series C RCPS after the
transaction(s),
|
|
|
(c)
|
alters
or changes the rights, preferences or privileges of the Series C
RCPS,
|
|
|
(d)
|
increases
or decreases the number of authorized Series C
RCPS,
|
|
|
(e)
|
authorises
the issuance of securities having a preference over or on a parity with
the Series C RCPS,
|
|
|
(f)
|
changes
the number of directors,
|
|
|
(g)
|
amends,
modifies or repeals the Memorandum of Association and/or Articles of the
Company in a manner which adversely affects the holders of the Series C
RCPS,
|
|
|
(h)
|
effects
any recapitalization or reorganization, or any voluntary or involuntary
liquidation under applicable bankruptcy or reorganization legislation, or
any dissolution, liquidation, or winding up of the
Company,
|
|
|
(i)
|
declares
or pays dividends on or makes any distributions with respect to any share
capital of the Company.
|
For
purposes of these protective provisions, any reference to the Company will be
deemed to include any subsidiary of the Company.
The
rights attached to the Series C RCPS shall not be varied, modified or deleted
unless in accordance with paragraph 9 above.
Page
| 33
Execution
Executed
as an Agreement.
|
Signed
for and on behalf of WaferGen Bio-systems, Inc
(WGBS.OB) in the presence
of:
|
|
|
|
|
|
|
|
Witness
|
|
Signatory
|
|
Name:
|
|
Name:
|
|
NRIC
No:
|
|
Designation:
|
|
|
|
NRIC
No:
|
|
Signed
for and on behalf of Malaysian Technology Development
Corporation Sdn Bhd
(Company No 235796-U)
in the presence of:
|
|
|
|
|
|
|
|
Witness
|
|
Signatory
|
|
Name:
|
|
Name:
|
|
NRIC
No:
|
|
Designation:
|
|
|
|
NRIC
No:
|
Page
| 34
|
Signed
for and on behalf of Prima Mahawangsa Sdn
Bhd (Company No 833152-M)
in the presence of:
|
|
|
|
|
|
|
|
Witness
|
|
Signatory
|
|
Name:
|
|
Name:
|
|
NRIC
No:
|
|
Designation:
|
|
|
|
NRIC
No:
|
|
Signed
for and on behalf of Wafergen Biosystems (M) Sdn Bhd
(formerly known
as Global Dupleks Sdn Bhd) (Company No 795066-H) in
the presence
of:
|
|
|
|
|
|
|
|
Witness
|
|
Signatory
|
|
Name:
|
|
Name:
|
|
NRIC
No:
|
|
Designation:
|
|
|
|
NRIC
No:
|
Page
| 35
