AGREEMENT AMONG For the Acquisition of 100% Shares of Octavian International Limited
AGREEMENT
AMONG
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1.
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PacificNet
Games International Corporation
Limited
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2.
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Octavian
International Limited
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3.
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Emperor
Holdings Limited
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4.
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Ziria
Enterprises Limited
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5.
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PacificNet
Inc.
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For
the Acquisition of 100%
Shares of
Octavian
International Limited
THIS
AGREEMENT is made on Dec. 7, 2007.
AMONG:
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1.
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Pacificnet
Games International Corporation,
a
company existing under the laws of the British Virgin Islands whose
principal executive office is situated at Floor 23rd,
Tower A, TimeCourt, Xx.0 Xxxxxxxxxxxx, Xxxxxxxx Xxxxxxxx Xxxxxxx,
Xxxxx
(hereinafter referred to as the “Purchaser”),
a wholly owned subsidiary of PacificNet Inc.
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2.
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Octavian
International Limited (“Octavian”),
a
company incorporated in the United Kingdom, whose principal place
of
business is Octavian Europe (Head Office), Bury House, 1 –0 Xxxx Xxxxxx,
Xxxxxxxxx, Xxxxxx XX0 0XX, XXXXXX XXXXXXX, Tel: x00 0000 000 000
, Fax:
x00 0000 000 000 , Web: xxx.xxxxxxxxxxxxxx.xxx (hereinafter
referred to as the “Company”);
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3.
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Emperor
Holdings Limited,
a
company incorporated
in Cyprus, of Xxxxxxxxxx Xxxxx, 00 Xxxxx Xxxxxxxxxx Xxxxxx 0000 Xxxxxxxx,
Xxxxxx (hereinafter
referred to as the “Holding
Company”);
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4.
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Ziria
Enterprises Limited
a
company incorporated in Cyprus whose office is at 000, 00xx
Xxxxxxx Xxxxxx, Xxxxxx Xxxxxxxx Xxx. 0xx
Xxxxx, Xxxxxxxx, Xxxxxx (hereinafter referred to as the “Seller”
or
“Warrantor”);
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| 5. |
PacificNet
Inc. (“PACT”), a
company incorporated under the laws of the State of Delaware in the
United
States of America whose principal executive office is situate at
Floor
23rd,
Tower A, TimeCourt, Xx.0 Xxxxxxxxxxxx, Xxxxxxxx Xxxxxxxx Xxxxxxx,
Xxxxx,
the shares of which are listed on the NASDAQ stock exchange in the
United
States of America under the trading symbol of
“PACT”.
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WHEREAS:
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1)
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The
Company is incorporated
under the laws of United Kingdom and having Company No. 04185988,
of 10 –
00 Xxxxxx Xxxxx, Xxxxx Xxxxxxx Xxxxxx, Southend Road, Woodford Green,
Essex AG8 8HD, United Kingdom.
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2)
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The
Company has a paid-in capital of 2 shares representing the entire
capital
of the Company (the “Shares”),
and is 100% owned by the Holding
Company.
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3)
|
The
Company is engaged in the business of providing networked gaming
solutions, serving casino, AWP (Amusements With Prizes), lotteries
and
emerging gaming markets worldwide including Europe, Latin America,
UK,
Italy, Germany, Russia, Ukraine, India, Columbia, Argentina, Brazil,
(hereinafter referred to as the "Business");
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4)
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The
Holding Company owns 100% of the Company. Seller owns 100% of the
Holding
Company. (set
out in Schedule 1.)
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5)
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The
Seller wishes to sell to the Purchaser, and the Purchaser wishes
to
purchase from the Seller,
the existing
10,000ordinary
shares of Holding Company (the “Sale
Shares”);
which in total represent 100%
of the issued
and outstanding
shares of the Holding Company , all upon the terms and subject to
the
conditions set forth herein.
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6)
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The
Purchaser requires the Warrantor to give such representations, warranties,
covenants and undertakings as are set out herein as a condition to
the
Purchaser's entry into this
Agreement.
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1
NOW,
THEREFORE,
in
consideration of the promises and the mutual agreements and covenants
hereinafter set forth, and intending to be legally bound hereby, the parties
to
this Agreement hereby agree as follows:
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1.
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INTERPRETATION
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1.1.
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1.2.
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In
this Agreement except where the context otherwise requires the
following
words and expressions shall have the following
meanings:
|
“3
Month LIBOR Rate” the
rate
of interest at which banks in the London wholesale money market will borrow
funds from each other for three months;
"BVI”
The
British Virgin Islands;
“Claim” all
actions, suits, claims, or legal, administrative, arbitration, governmental
or
other procedures or investigations in respect of damages, losses, settlement
payments, in respect of deficiencies, liabilities, costs, expenses and claims
suffered, sustained, incurred or required to be paid in relation to this
Agreement,
"Completion" completion
of the sale and purchase of the Sale Shares to the Purchaser in accordance
with
Clause 5 of this Agreement;
"Completion
Date"
on or
before 6 p.m. Beijing Time on January 31, 2008(or such later date as the parties
shall agree in writing);
"Conditions" the
conditions contained or referred to in Clause 4;
"Consideration" the
consideration payable for the sale and purchase of the Sale Shares of the
Holding Company pursuant to Clause 3;
“Escrow
Shares” 2,330,000
PACT Shares with the restrictions on such shares arising under the US federal
securities laws;
“Escrow
Agent” An
agent
designated by the Purchaser that holds the Escrow Shares.
"ESA" Executive
Services Agreement with Xxxxxx Xxxxxxxxxxxxxx
“Group
” those
companies listed in Schedule 2, Part 1
“Gaming
Segmentation Group”
The
group of companies and business units created by combining PacificNet Games
Limited, Take1 Technologies, Guangdong Poly Blue Express Communications Co.
Ltd,, Octavian, and any other companies that are directly involved in the gaming
sector.
“PACT
Shares” Common
Stock of PACT;
“PRC” People’s
Republic of China;
“RMB”
Chinese
RenMinBi
"Sale
Shares" the
10,000 ordinary shares of the Holding Company (that represents 100% of the
Holding Company) such shares being beneficially owned by and registered in
the
name of the Seller set out in Part II of Schedule 1;
2
“$” United
States dollars, all amounts stated in this Agreement shall be United States
dollars unless specified otherwise;
“United
States” United
States of America;
“US
GAAP” United
States Generally Accepted Accounting Principles
"VWAP" The
average of the Volume
Weighted Average Price of the PACT Shares for each day in the period seven
days
prior and seven days after the Completion Date.
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1.3.
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Words
and phrases not otherwise defined in this Agreement, the definitions
of
which are contained or referred to in the Companies Ordinance of
Hong Kong
(Cap. 32), shall be construed as having the meanings thereby attributed
to
them.
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1.4.
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References
in this Agreement to ordinances and to statutory provisions shall
be
construed as references to those ordinances or statutory provisions,
respectively, as modified (on or before the date hereof) or re-enacted
(whether before or after the date hereof) from time to time and to
any
orders, regulations, instruments or subordinate legislation made
under the
relevant ordinances or provisions thereof and shall include references
to
any repealed ordinance or provisions thereof which has been so re-enacted
(with or without modifications).
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1.5.
|
The
headings are for convenience only and shall not affect the construction
of
this Agreement.
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1.6.
|
All
representations, undertakings, warranties, indemnities, covenants,
agreements and obligations given or entered into by more than one
person
are given or entered into jointly and severally unless stated to
be
severally only.
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1.7.
|
Except
where the context otherwise requires words denoting the singular
include
the plural and vice versa; words denoting any one gender include
all
genders; words denoting persons include incorporations and firms
and vice
versa.
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1.8.
|
Reference
to clauses, sub-clauses, paragraphs and schedules are (unless the
context
requires otherwise) to clauses, sub-clauses, paragraphs and schedules
of
this Agreement.
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|
1.9.
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The
expressions the “Holding Company”, the “Company”, the “Seller” and the
“Purchaser” unless the context requires otherwise shall include their
successors, personal representatives and permitted
assigns.
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1.10.
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The
schedules and appendices form part of this
Agreement.
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2.
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SALE
OF SHARES
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2.1.
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Subject
to the terms of this Agreement, the Seller shall sell as registered
owner
of record and the Purchaser (relying on the representations, warranties,
agreements, covenants, undertakings and indemnities hereinafter referred
to) shall purchase the Sale Shares free from all options, liens,
charges,
pledges, claims, agreements, encumbrances, equities and other third
party
rights of any nature whatsoever and together with all rights of any
nature
whatsoever now attaching or accruing to it including all rights to
any
dividends or other distribution declared paid or made in respect
of them
after the date of this Agreement.
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|
3.
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CONSIDERATION
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3.1. Stock
and Cash Consideration:
The
purchase consideration for 100%
of the
equity interest of Holding Company shall consist of (i) the issuance and release
of up to 2,330,000 PACT Shares (the “Stock
Payment”)
and
(ii) cash consideration of up to $18,900,000 to be paid upon the completion
of
certain net profit performance targets (“Earn-Out
Amounts”)
set
forth in Clause 3.5 below, in accordance with the schedule commencing in 2009
through 2012 (the “Earn-Out
Years”,
being
1 January to 31 December of each year).
3
3.2. Stock
Payment
Purchaser
shall issue the Escrow Shares to Seller or its nominee(s) in accordance with
the
following:
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(a)
|
Within
30 days of the signing of this agreement, Purchaser shall deliver
to the
Escrow Agent (designated by the Purchaser) the Escrow Shares, to
be held
under the terms of an escrow agreement to be entered into with the
Escrow
Agent. The Share Release schedule for Stock Payment is illustrated
in
Table 1 in Clause 3.4 below.
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(b)
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In
exchange, Seller will transfer to the Purchaser the Sale Shares at
the
Completion Date.
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3.3
3.3.1
In
the event that:
| (a) |
The
Purchaser fails to receive any required regulatory approvals by the
US
SEC, NASDAQ, or fails to receive the approval of the Shareholders
of PACT
(if required) by the Completion Date or such other date as the parties
hereto may agree in writing;
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| (b) |
The
conditions set out in Clause 4 shall not have been fulfilled or waived
by
the relevant party by the Completion Date or such other date as the
parties hereto may agree in writing (provided that unless the Purchaser
has notified the Seller in writing that it is not satisfied by 1
January
2008 condition 4.1(a) shall be deemed to have been fulfilled and
unless
the Seller has notified the Purchaser in writing that it is not satisfied
by 1 January 2008 condition 4.4(a) shall be deemed to have been
fulfilled); or
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| (c) |
The
transaction is not completed for any reason by June 30, 2008, the
Escrow Agreement shall provide that the Escrow Shares shall be returned
to
Purchaser and this Agreement shall cease to have effect immediately
after
that time (but without prejudice to the parties accrued rights and
liabilities under this Agreement at the time it ceases to have effect).
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| 3.3.2 |
In
the event that the VWAP of the PACT Shares is greater than $6.50
then the
price of the stock from $6.50 and upwards will be offset by lowering
the
Earn-Out Amounts in 3.5.2 by the amount over $6.50 multiplied by
the
number of Escrow Shares issued pursuant to 3.4.1 Any such amounts
shall be
offset against the last Earn-Out Year first with any excess against
the
third Earn-Out Year, then against the second Earn-Out Year and lastly
against the first Earn-Out Year.
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| 3.3.3 |
In
the event that the volume weighted average price of the PACT Shares
daily
in the period of seven days up to (but not including) the Completion
Date
falls below $5, the Seller shall have the option not to complete
this
Agreement in which event he shall notify the Purchaser in writing
upon
which the Escrow Shares shall be returned to Purchaser and this Agreement
shall cease to have effect immediately (but without prejudice to
the
parties accrued rights and liabilities under this Agreement at the
time it
ceases to have effect).
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3.4 Escrow
Arrangement for Escrow Shares
| (a) |
Seller
hereby agrees to allow the Purchaser to appoint the Escrow Agent
upon the
terms of an escrow agreement in the agreed terms to hold all the
Escrow
Shares to be issued in accordance with the Escrow Agreement and this
Agreement on the Completion Date and Seller undertakes that it shall
not
either sell, transfer, charge, encumber, grant options over or otherwise
dispose of any legal or beneficial interest in any of the Escrow
Shares
until such part of the Escrow Shares are released by the Escrow Agent
to
Seller in accordance with the following
schedule.
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| (b) |
Release
of the Escrow Shares as provided below, assumes receipt by PACT of
certification from its auditors that the auditor’s review relating to the
Holding Company, the Company, and its business is acceptable and
can be
consolidated into PACT’s audited accounts, balance sheet and financial
statements, in accordance with US GAAP. The Purchaser and PACT shall
use
their best endeavours to obtain such certification on or before the
Completion Date, subject to the Seller and the Group providing assistance
reasonably requested by the Purchaser and PACT for such purpose.
In the
event that the auditors do not give their certification, the Seller
shall
be entitled to appoint an independent auditor that is approved by
the
Purchaser (such approval not to be unreasonably withheld or delayed)
to
consider the position of the Purchaser's auditors and the decision
of the
independent auditor shall, save in the case of a manifest error,
be
binding on both parties and shall supercede the decision of the
Purchaser's auditors.
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4
Table
1:
FYE
=
Fiscal Year Ending
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Release
Date
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Number
of Shares to be Released
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Release
Criteria
based
on Accumulated Net Profit
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||
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0.0.0.Xx
soon as possible after the Completion Date but in any event within
20
working days after Completion Date.
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1,230,000
Escrow Shares
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None
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||
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3.4.2.Within
30 days from the receipt of the Auditors certification of the Net
Profit
for the FYE Dec. 31, 2008. provided that the Purchaser and PACT
and
Company shall use their best endeavours to obtain such certification
by 31
March 2009
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1,100,000
Escrow Shares ,
900,000
Escrow Shares ,
600,000
Escrow Shares ,
300,000
Escrow Shares
|
The
Company has achieved Net Profit for the FYE Dec. 31, 2008 not less
than
USD$ 4,000,000
The
Company has achieved Net Profit for the FYE Dec. 31. 2008 not less
than
USD$3,000,000
The
Company has achieved Net Profit for the FYE Dec. 31. 2008 not less
than
USD$2,0000,000 .
The
Company has achieved Net Profit for the FYE Dec. 31. 2008 not less
than
USD$1,000,000 .
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||
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Total
Number of PACT Shares to be released from the Escrow
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Maximum
2,330,000 Escrow Shares
|
The
Seller will be entitled to all of the Escrow Shares if the Company
has
achieved Net Profit for the Fiscal Years ending on Dec. 31, 2008
not less
than USD$4,000,000. Any Escrow Shares that have not been released
pursuant
to 3.4.2, shall remain in the Escrow and roll over for each successive
year if not earned in the previous fiscal year up to FY2012 based
on
growth in Net Profit of the Company of 20% based on the Net Profit
of the
previous fiscal year. In the event that this is achieved, all Escrow
Shares still in Escrow shall be released to the
Seller.
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| 3.4.3 |
If
the Seller notifies the Purchaser that it disagrees with the auditor’s
certification within 20 days of receipt, the Seller and the Purchaser
shall use all reasonable endeavours to resolve the dispute within
20 days
from notification. If the dispute is not resolved within that 20
day
period, either the Seller or the Purchaser is entitled to appoint
an
independent accountant to review the Company Net Profit Calculation
and
the decision of the independent accountant shall, save in the case
of
manifest error, be binding on all
parties.
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3.5 Earn-Out:
3.5.1
Entitlement
to Earn-out
| (a) |
In
addition to payments in accordance with Clause 3.2., the Purchaser
must
pay to the Seller the Earn-Out Amount in respect of each of the Earn-Out
Year determined in accordance with this Clause 3.5.
|
5
| (b) |
Subject
to Clause 3.5.5, the amount payable in respect of each Earn-Out Year
will
be a proportion of the Earn-Out Amount in respect of the relevant
Earn-Out
Year.
|
| (c) |
The
proportion of each Earn-Out Amount that is payable in respect of
each
Earn-Out will be determined in accordance with Clause
3.5.3.
|
| (d) |
Any
amounts payable in accordance with this Clause 3.5 must be paid in
accordance with Clause 3.5.6.
|
3.5.2 Earn-Out
Amounts
Subject
to Clause 3.5.7, the Earn-Out Amount shall be payable as follows:
| (a) |
in
respect of the first Earn-Out Year (2009)
US$3,150,000;
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| (b) |
in
respect of the second Earn-Out Year (2010) US$4,200,000 plus any
part of
the Earn-Out Amount for the first Earn-Out Year that has not become
payable in accordance with Clause
3.5.3(a)
|
| (c) |
in
respect of the third Earn-Out Year (2011) US$5,250,000 plus any part
of
the Earn-Out Amount for the second Earn-Out Year that has not become
payable in accordance with Clause 3.5.3(b) (including any amounts
previously rolled over); and
|
| (d) |
in
respect of the last Earn-Out Year (2012) US$6,300,000 plus any part
of the
Earn-Out Amount for the third Earn-Out Year that has not become payable
in
accordance with Clause 3.5.3(c) (including any amounts previously
rolled
over).
|
3.5.3 Performance
Target
| (a) |
In
respect of the first Earn-Out Year:
|
|
(i)
|
the
performance target for the Company is Net Profit of US$3,150,000
("Target
1");
|
| (ii) |
where
the Company achieves 100% of Target 1, 100% of the Earn-Out Amount
in
clause 3.5.2(a) shall be due and payable to the Seller;
and
|
|
(iii)
|
where
the Company achieves less than 100% of Target 1, the percentage of
the
Earn-Out Amount payable shall be determined by dividing the Net Profit
of
the Company attributable to the first Earn-Out Year by Target 1 and
multiplying by 100.
|
|
(b)
|
In
respect of the second Earn-Out Year
|
|
(i)
|
the
performance target for the Company is Net Profit of US$4,200,000
plus any
part of Target 1 not achieved in the first Earn-Out year ("Target
2");
|
|
(ii)
|
where
the Company achieves 100% of Target 2, 100% of the Earn-Out Amount
in
clause 3.5.2(b) shall be due and payable to the Seller;
and
|
|
(iii)
|
where
the Company achieves less than 100% of Target 2, the percentage of
the
Earn-Out Amount payable shall be determined by dividing the Net Profit
of
the Company attributable to the second Earn-Out Year (plus any part
of the
Net Profit of the Company attributable to the first Earn-Out Year
over
100% of Target 1) by Target 2 and multiplying by 100 (provided always
that
the Seller shall in no circumstances be entitled to any payment over
and
above the Earn-Out Amount set out in clause
3.5.2(b)
|
|
(c)
|
In
respect of the third Earn-Out Year:
|
| (i) |
the
performance target for the Company is Net Profit of US$5,250,000
plus any
part of Target 2 not achieved in the second Earn-Out Year ("Target
3");
|
| (ii) |
where
the Company achieves 100% of Target 3, 100% of the Earn-Out Amount
in
clause 3.5.2(c) shall be due and payable to the Seller;
and
|
6
| (iii) |
where
the Company achieves less than 100% of Target 3, the percentage of
the
Earn-Out Amount payable shall be determined by dividing the Net Profit
of
the Company attributable to the third Earn-Out Year (plus any part
of the
Net Profit of the Company attributable to the first and second Earn-Out
years over 100% of Target 2) by Target 3 and multiplying by 100 (provided
always that the Seller shall, in no circumstances be entitled to
any
payment over and above the Earn-Out Amount set out in clause
3.5.2(c)
|
|
(d)
|
In
respect of the fourth Earn-Out
Year:
|
| (i) |
the
performance target for the Company is Net Profit of US$6,300,000
plus any
part of Target 3 not achieved in the third Earn-Out Year ("Target
4");
|
| (ii) |
where
the Company achieves 100% of Target 4, 100% of the Earn-Out Amount
in
3.5.2(d) shall be due and payable to the Seller;
and
|
| (ii) |
where
the Company achieves less than 100% of Target 4, the percentage of
the
Earn-Out Amount payable shall be determined by dividing the Net Profit
of
the Company attributable to the fourth Earn-Out Year (plus any part
of the
Net Profit of the Company attributable to the first, second and third
Earn-Out Years over 100% of Target 3) by Target 4 and multiplying
by 100
(provided always that the Seller shall, in no circumstances be entitled
to
any payment over and above the Earn-Out Amount set out in clause
3.5.2(d).
|
3.5.4 Clarification
of Performance Targets
| (a) |
For
the purpose of Clause 3.5.3
|
| (i) |
the
Net Profit of the Company in respect of any Earn-Out Year is the
consolidated Net Profit of the Company during the relevant Earn-Out
Year
as disclosed in the audited accounts of the Company for that Earn-Out
Year
to be prepared on the basis of the Company Net Profit Calculation
and
which the Purchaser must cause to be prepared by no later than 30
September in the year following the relevant Earn-Out Year as disclosed
in
the relevant audited financial statements (to be prepared in accordance
with US GAAP); and in
each case including Net Profit attributable to associates and joint
ventures on the same basis as above but deducting all written off
bad
debts attributable to associates and joint ventures on the same basis
as
above.
|
| (b) |
If
the Seller notifies the Purchaser that it disagrees with the Company
Net
Profit Calculation provided to it by the Seller within 20 days of
receipt,
the Seller and the Purchaser shall use all reasonable endeavours
to
resolve the dispute within 20 days of notification. If the dispute
is not
resolved within such 20 days, either the Seller or the Purchaser
is
entitled to appoint an independent accountant to review the Company
Net
Profit Calculation and the decision of the independent accountant
shall,
save in the case of manifest error, be binding on all
parties.
|
3.5.5 Acceleration
If
a
Relevant Circumstance, as defined in the ESA, occurs at any time before the
end
of the last Earn-Out Year, then subject to the Listing Rules of the NASDAQ
stock
exchange and the United States Security Exchange Commission, and Clause 16.3
of
the ESA, any prospective Earn-Out Amount (being the maximum amount payable)
is
immediately due and payable to the Seller by issue of cash consideration,
subject to Clause 3.5.7. If the Relevant Circumstance that triggers this Clause
is a takeover or scheme of arrangement, the Purchaser must pay such amounts
prior to the record date for such takeover or scheme of arrangement. If the
Relevant Circumstance that triggers this Clause is a separate listing (IPO)
for
the Gaming Segmentation Group, the Purchaser must pay such amounts to the
equivalent in stock in the new listed company.
7
3.5.6 Payment
of Earn-Out
| (a) |
The
Purchaser must pay:
|
| (i) |
any
Earn-Out Amount payable in respect of the first Earn-Out Year by
the issue
of cash consideration;
|
| (ii) |
any
Earn-Out Amount payable in respect of the second Earn-Out Year by
the
issue of cash consideration;
|
| (iii) |
any
Earn-Out Amount payable in respect of the third Earn-Out Year by
the issue
of cash consideration; and
|
| (iv) |
any
Earn-Out Amount payable in respect of the last Earn-Out Year by the
issue
of cash consideration.
|
| (b) |
Subject
only to Clause 3.5.6 (d), payments under this Clause 3.5.6 must be
made no
later than 30 September in the year following the relevant Earn-Out
Year.
|
| (c) |
The
Purchase Price is deemed to be reduced by any Earn-Out Amount which
is not
payable under this Agreement.
|
| (d) |
When
an Earn-Out Amount is due and payable to the
Seller:
|
| (i) |
the
Purchaser shall procure that, to the extent lawful, the Company shall
declare a dividend to the Purchaser each financial year provided
always
that the Seller has first consented to the payment of such dividend
(such
consent not to be unreasonably withheld or
delayed);
|
|
(ii)
|
where
an Earn-Out Amount is due and payable to the Seller, the Purchaser
shall
use any such dividend to make payment to the Seller of any amounts
of the
Earn-Out Amounts earned by the Seller, such payment being made by
the
payment date set out in clause 3.5.6
(b);
|
| (iii) |
in
the event that:
|
| 1. |
a
dividend is not paid (due to it either being unlawful or the Seller
withholding his consent to the payment);
or
|
|
2.
|
a
dividend is paid but is not sufficient to meet the full amount of
the
Earn-Out Amount, the
Purchaser shall, subject only to the remainder of this sub clause
(d)
(iii), use its available cash (if any) to pay the Earn-Out Amount
(or any
shortfall). If the Purchaser does not, in the reasonable opinion
of a
majority of its board of directors, have any available cash, the
payment
of the Earn-Out Amount (or outstanding part thereof) shall be deferred
until such time as:
|
|
3.
|
a
dividend can be lawfully paid by the Company and/or the Seller consents
to
payment of the dividend; or
|
| 4. |
the
board of the Purchaser determines that it has available cash, at
which time the Earn-Out Amount (or outstanding part thereof) shall
be
immediately paid to the Seller. The decision of the board of the
Purchaser
referred to in this paragraph must be reached on the basis of reasonable
relevant considerations, such considerations to include the advice
of
Xxxxxx (or any replacement auditors for the Purchaser and its group
from
time to time) and reasonable evidence of the same must be given to
the
Seller;
|
|
(iv)
|
payment
of an Earn-Out Amount (an any part thereof) cannot be deferred for
a
period of more than 3 years from the date on which it is first due
and
payable to the Seller under clause 3.5.6 (b) (or would have been
but for
the application of this sub clause (d)) and at the expiry of such
maximum
period, the Earn-Out Amount (or any outstanding part thereof) shall
become
immediately due and payable.
|
8
|
(v)
|
in
the event that payment of an Earn-Out Amount (or part thereof) is
deferred
for any reason, beyond the date on which it was payable under clause
3.5.6
(b), interest shall be paid by the Purchaser on that Earn-Out Amount
(or
the outstanding part thereof) at 3 Month LIBOR Rate at the time of
deferral, such interest to be paid annually, or, if earlier, with
payment
of the Earn-Out Amount (or outstanding part
thereof).
|
3.5.7 Reduction
of Earn-Out
| (a) |
Any
Claim against the Seller arising out of or in respect of this Agreement
to
which this Clause 3.5.7 applies, upon final adjudication or as agreed
(Determination), will be satisfied as
follows:
|
| (i) |
firstly,
by reducing any prospective Earn-Out Amounts (which have not yet
been
earned) as follows:
|
| (A) |
by
reducing the prospective Earn-Out Amount for the last Earn-Out Year
(if
any) by the lesser of the value of that prospective Earn-Out Amount
and
the amount of the Claim outstanding;
|
| (B) |
then
by reducing the prospective Earn-Out Amount for the third Earn-Out
Year
(if any) by the lesser of the value of that prospective Earn-Out
Amount
and the amount of the Claim outstanding after reduction of the prospective
Earn-Out Amount for the last Earn-Out Year in accordance with Clause
3.5.7(a)(i)(A);
|
| (C) |
then
by reducing the prospective Earn-Out Amount for the second Earn-Out
Year
(if any) by the lesser of the value of that prospective Earn-Out
Amount
and the amount of the Claim outstanding after reduction of the prospective
Earn-Out Amount for the third Earn-Out Year in accordance with Clause
3.5.7(a)(i)(B);
|
| (D) |
then
by reducing the prospective Earn-Out Amount for the first Earn-Out
Year
(if any) by the lesser of the value of that prospective Earn-Out
Amount
and the amount of the Claim outstanding after reduction of the prospective
Earn-Out Amount for the second Earn-Out Year in accordance with Clause
3.5.7(a)(i)(C) ;
|
|
(b)
|
In
the event that the Claim has not been fully satisfied in accordance
with
Clause 3.5.7(a) the Seller must satisfy the balance of the Claim
in
Immediately Available Funds.
|
3.5.8 Earn-Out
Period
| (a) |
From
the Completion Date until the end of the last Earn-Out Year, the
Purchaser
and PACT undertake to the Seller that they shall not, without the
prior
written consent of the Seller, make any changes to the business of
the
Company where such change is reasonably likely have a detrimentable
impact
on the ability of the Company to meet the targets set out in Clause
3.5.3
or do anything which is reasonably likely to prejudice the goodwill
of the
Company or its subsidiaries including but not limited
to:
|
| (i) |
using
or disclosing or divulging to any person other than to officers or
employees of the Group and/or PACT and companies within the PACT
group,
companies whose province it is to know the same for the purposes
of the
Company carrying on the Business, any information relating to the
Companies or the subsidiaries other than any information properly
available to the public or disclosed or divulged pursuant to an order
of a
court of competent jurisdiction or as required pursuant to any applicable
law or regulation and the Purchaser undertakes further that it shall
not
use any advantages derivable from such confidential information for
business or affairs other than the Business or affairs of the Company
and
its subsidiaries;
|
|
(ii)
|
in
relation to any trade, business or company use a name, or internet
domain
name including the word or symbol, or logo design Octavian
or
any similar word and symbol other than for the Company, its Business
and
the subsidiaries of the Company and shall use all reasonable endeavors
to
procure that no such name shall be used by any person, firm or company
with which it is/they are
connected;
|
9
|
(iii)
|
solicit or
entice or endeavor to solicit or entice away from the Company or
its
subsidiaries, any employee, officer, manager or consultant of the
Company
or its subsidiaries; or
|
| (iv) |
deal
with, canvass, solicit or approach or cause to be dealt with, canvassed,
solicited or approached for business, any person who is or was in
the
previous 12 months, a customer, supplier or client of the Company
or its
subsidiaries where the purpose of such dealing, canvassing, soliciting
or
approach is to entice or encourage such customer, supplier or client
to
cease or reduce its trading with the Company or its
subsidiaries.
|
| (b) |
For
the avoidance of doubt, this clause shall not prevent the transfer
into
the Company of any other business or company within the PACT group
at
anytime during this period.
|
| (c) |
Any
action by the Purchaser or any member of the PACT Group which has
a
negative effect on the Net Profit of the Company shall be disregarded
when
calculating the Net Profit for the purposes of the Earn-Out Amount
due
under this clause 3 and the Net Profit shall be calculated as if
such
action had not occurred. Where the action taken by the Purchaser
or the
PACT is an action prohibited by clauses 3.5.8(a)(ii) to (iv) (inclusive),
the Seller agrees that he shall not make any claim in relation to
the
breach of such clauses provided that the negative effect of any such
prohibited action on the Net Profit of the Company is disregarded
in
accordance with this clause.
|
|
4
|
CONDITIONS
|
4.1 Any
of
the obligations of Purchaser hereunder is conditional upon:
| (a) |
the
Purchaser being satisfied in its sole and absolute discretion with
the
results of a legal and financial due diligence review to be conducted
by
it on the Holding Company and the Company (the “Companies”),
all such due diligence to be completed by 1 January
2008;
|
| (b) |
the
Purchaser being satisfied (acting reasonably) that either of the
Seller or
Harmen Breninnkmeijer has either (i) completed or will on the Completion
Date complete a capital raising for $5,000,000 or (ii) has obtained
irrevocable commitments from parties to subscribe for $5,000,000
on a
capital raising to occur within 6 months of the Completion Date provided
always that the Purchaser agrees that in the event that the Seller
waives
the condition at clause 4.4(b), the Purchaser is deemed to have waived
this condition;
|
| (c) |
if
required, the relevant stock exchange, government and securities
authority
and regulator in the United States granting listing of the PACT Shares
to
be issued herein;
|
| (d) |
a
resolution at a meeting or unanimous written consent of the Directors
of
PACT approving this Agreement, the purchase of the Sale Shares, the
issuance of the Escrow Shares, the implementation of the transactions
contemplated hereunder and all other matters incidental hereto in
accordance with the provisions of PACT’s certificate of incorporation and
Bylaws and such rules, regulations and laws in force from time to
time in
the United States and which apply to
PACT;
|
| (e) |
if
required, the shareholders of PACT at a meeting of shareholders approving
this Agreement, the purchase of the Sale Shares, the issuance of
the
Escrow Shares, the implementation of the transactions contemplated
hereunder and all other matters incidental hereto in accordance with
the
provisions of PACT’s certificate of incorporation and Bylaws and such
rules, regulations and laws in force from time to time in the United
States and which apply to PACT;
|
10
| (f) |
all
amounts outstanding to either the Seller or Harmen Breninnkmeijer
by the
Companies have been either repaid by the Companies or otherwise waived
by
the Seller or Harmen Breninnkmeijer; and
|
| (g) |
the
auditor of the Purchaser and PACT, Xxxxxx & Company, Inc.
(“Xxxxxx”)
being satisfied at its sole and absolute discretion that the accounts
of
the Companies can be consolidated into PACT’s audited financial statement,
including balance sheet and income statements in accordance with
the US
GAAP.
|
|
4.2
|
The
Seller and the Companies undertake to disclose in writing to the
Purchaser
anything which will or is reasonably likely to prevent any of the
conditions from being satisfied at or prior to the Completion Date,
as
applicable, immediately upon the Seller and/or the Companies becoming
aware of such a situation.
|
| 4.3.1 |
From
the date of this Agreement until the Completion Date, except for
the
transactions described herein or otherwise with the prior written
consent
of the Purchaser:
|
|
(i)
|
The
Warrantor warrants and undertakes that it will cause the Companies
to:
|
| (a) |
conduct
its Business in the ordinary course and consistent with past
practices;
|
| (b) |
use
its best efforts to maintain in full force and effect the existence
of the
Companies;
|
| (c) |
promptly
and timely prepare and file any financial reports and franchise tax
returns and pay all taxes and assessments, if any, required to maintain
the existence of the Companies;
|
| (d) |
keep
records in which true and correct entries will be made of all material
transactions by and with the
Companies;
|
| (e) |
duly
observe all material requirements of governmental authorities unless
contested in good faith by appropriate proceedings with the consent
of the
Purchaser;
|
| (f) |
promptly
pay and discharge, or cause to be paid and discharged, when due and
payable, all lawful taxes, assessments and governmental charges or
levies
imposed upon the income, profits, property or business of the Companies
unless contested in good faith by appropriate proceedings with the
consent
of the Purchaser;
|
| (g) |
at
all times comply with the provisions of all contracts, agreements
and
leases to which the Companies are a party, unless contested in good
faith
by appropriate proceedings with the consent of the Purchaser;
and
|
| (h) |
to
use reasonable endeavors to procure that the key employees of the
Companies at the date of this Agreement remain and continue as employees
after completion except in the event of a breach of contract by such
employee(s);
|
|
(ii)
|
The
Warrantor warrants and undertakes to cause the Companies not
to:
|
| (a) |
modify
their Memorandum or Articles of Incorporation or
Bylaws;
|
| (b) |
cause
or permit their liquidation or
dissolution;
|
| (c) |
institute,
or permit to be instituted against them, any proceeding, which remains
un-dismissed for a period of 30 days after the filing thereof, seeking
to
adjudicate either as bankrupt or insolvent, or seeking liquidation,
winding-up, reorganization, arrangement, adjustment, protection,
relief or
composition of them or their debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the
entry of
any order or relief or the appointment of receiver, trustee or other
similar official for them or for any substantial part of their
property;
|
11
| (d) |
make
a general assignment for the benefit of their
creditors;
|
| (e) |
except
as agreed in this Agreement, declare or pay any dividend or make
any
distribution to any of their
shareholders;
|
| (f) |
issue,
redeem, sell or dispose of, or create any obligation to issue, redeem,
sell or dispose of, any shares of their capital stock (whether authorized
but unissued or held in treasury);
|
| (g) |
effect
any stock split, reclassification or
combination;
|
| (h) |
modify
their agreements and other obligations with respect to their long-term
indebtedness, including but not limited to their loan agreements,
indentures, mortgages, debentures, notes and security agreements
provided
that the Company shall be permitted to enter into bridging loan agreements
in a maximum aggregate amount of $5,000,000
|
| (i) |
negotiate
or enter into an agreement with another party related to the sale
of the
Companies or provide or agree to provide any information to another
party
for the purpose of evaluating the possibility of the sale of the
Shares,
the Companies or any part of their respective businesses to such
other
party.
|
| (iii) |
the
Warrantor and the Companies shall procure that the Purchaser, its
agents
and representatives are given reasonable access to such documents
relating
to the Companies, as the Purchaser shall request. The Companies will
assist the Purchaser’s auditor to complete the audit report of the
Companies in accordance with the US
GAAP.
|
| (iv) |
there
shall have been no material adverse change in the assets or the business,
prospects, financial condition or results of operations of the
Companies.
|
| 4.3.2 |
The
Purchaser shall be entitled to rescind this Agreement by notice in
writing
to the Seller, the Companies if prior to the Completion Date it appears
that any of the Warranties is not or was not true and accurate in
any
material respects or if there is any material non fulfillment of
any of
the Warranties which (being capable of remedy) is not remedied prior
to
the Completion Date.
|
|
4.4
|
Any
of the obligations of Seller hereunder is conditional
upon:
|
| (a) |
the
Seller being satisfied in its sole and absolute discretion with the
results of a legal and financial due diligence review to be conducted
by
it on the Purchaser and PACT all such due diligence to be completed
by 1
January 2008;
|
| (b) |
the
Seller being satisfied (acting reasonably) that either of it or Harmen
Breninnkmeijer has either (i) completed or will on the Completion
Date
complete a capital raising for $5,000,000 or (ii) obtained irrevocable
commitments from parties to subscribe for $5,000,000 on a capital
raising
to occur within 6 months of the Completion
Date;
|
| (c) |
the
Seller is satisfied with evidence provided by the Purchaser that
PACT has
met the Hearing Review Councils requirements to cancel/remove the
NASDAQ
Listing Qualifications Panel (NLQP) de-listing
order.
|
| (d) |
the
Purchaser would enter into the ESA with Harmen Breninnkmeijer upon
mutually agreed terms and conditions;
|
| (e) |
PACT
shall have taken all necessary steps under its by-laws, and shall
have
received the approval of its Nominating Committee, if necessary,
to
provide for Seller to nominate the Seller and one reputable independent
director to the PACT board of
directors;
|
| 4.5 |
The
Purchaser undertakes to disclose in writing to the Seller anything
which
will or is reasonably likely to prevent any of the conditions from
being
satisfied at or prior to the Completion Date, as applicable, as soon
as
practicable upon becoming aware of such a
situation.
|
12
| 4.6 |
Until
the Completion Date, the Purchaser shall procure that the Warrantor
and
the Companies, its agents and representatives are given reasonable
access
to such documents relating to the Companies, as the Seller shall
request.
The Purchaser will assist the Seller’s auditor to complete the audit
report of the Companies in accordance with US
GAAP.
|
| 4.7 |
The
Seller shall be entitled to rescind this Agreement by notice in writing
to
the Purchaser if prior to Completion it appears that any of the Warranties
is not or was not true and accurate in any material respect or if
there is
any material non-fulfillment of any of the Warranties which (being
capable
of remedy) is not remedied prior to
Completion.
|
|
5
|
COMPLETION
|
| 5.1 |
Subject
to the terms of this Agreement and subject to the approval of the
board of
directors of the Purchaser, the Completion of the transactions
contemplated by this Agreement, shall take place pursuant to this
clause
at the offices of the Purchaser's Legal Counsel on the Completion
Date.
|
| 5.2 |
Upon
Completion the Seller, the Company, and the Holding Company shall
deliver
to the Purchaser:
|
| (a) |
duly
completed and signed transfers of the Sale Shares by the Seller in
favor
of the Purchaser or as it may direct together with the relative
bought/sold notes and share
certificates;
|
| (b) |
duly
completed, executed and validly issued share certificates of the
Sale
Shares in favor of the Purchaser or as it may
direct;
|
| (c) |
certified
true copies of the minutes of meetings of the Company and the Holding
Company’s board of directors and shareholders approving the transfer,
assignment and allotment of the Sale Shares to the
Purchaser;
|
| (d) |
certified
true copies of the minutes of meetings of the Company and the Holding
Company’s board of directors and shareholders approving this Agreement and
all matters herein contemplated and the transfer and assignment of
its
Sale Shares to the Purchaser; and
|
| (e) |
the
executed ESA;
|
|
5.3
|
Upon
Completion the Purchaser shall deliver to the Seller and the Holding
Company a copy of resolutions of the board of directors of the Purchaser
approving this Agreement, the ESA and other documents necessary for
the
purpose of effecting this transaction and authorizing a person or
persons
to execute the same (with seal, where appropriate) for and on its
behalf.
The Purchaser shall issue to the Purchaser the share certificates
for the
Escrow Shares issued pursuant to clause 3.4.1 as soon as possible
but in
any event, within 20 working days of the Completion
Date.
|
|
6
|
REPRESENTATIONS,
WARRANTIES AND
UNDERTAKINGS
|
| 6.1.1 |
Representations
and Warranties. The
Company, Holding Company, the Seller, and the Warrantor, severally
represent, warrant and undertake to the Purchaser (to the extent
that the
provisions of this clause shall continue to have full force and
effect
notwithstanding completion, and shall survive for one year thereafter
and
any Claim in respect of the Warranties must be brought by the Purchaser
within 12 months of the Purchaser first becoming aware of the
circumstances leading to such Claim)
that:
|
| (a) |
each
of the representations and warranties are true and accurate in all
respects and not misleading at the date of this Agreement and will
continue to be true and accurate in all respects and not misleading
up to
and including the Completion Date;
|
| (b) |
the
Companies and the Seller have and will have full power and authority
to
enter into and perform this Agreement which constitute or when executed
will constitute binding obligations on them in accordance with their
respective terms;
|
| (c) |
the
Sale Shares constitute 100 percent of the entire issued and allotted
capital of the Holding Company, , on a fully diluted
basis,
|
13
| (d) |
the
Holding Company owns 100 percent of the entire issued and allotted
capital
of the Company on a fully diluted basis, free from any encumbrance;
|
| (e) |
there
have been no options, warrants, pledges, bonds or any instrument
or
agreement of the like whatsoever granted to any third party by
the Seller
in favor of any third party in respect of any shares in the Holding
Company without the prior agreement of the
Purchaser;
|
| (f) |
there
have been no options, warrants, pledges, bonds or any instrument
or
agreement of the like whatsoever granted to any third party by
the Holding
Company in favor of any third party in respect of any shares in
the
Company without the prior agreement of the
Purchaser;
|
| (g) |
there
is and at Completion will be no pledge, lien or other encumbrance
on, over
or affecting the Sale Shares and there is and at completion will
be no
agreement or arrangement to give or create any such encumbrance
and no
claim has been or will be made by any person to be entitled to
any of the
foregoing with respect to the Sale Shares, or the shares of the
Company
without the prior agreement of the
Purchaser;
|
| (h) |
the
Seller is the 100% beneficial owner of the shares in the Holding
Company
free from any encumbrance, the Seller has, and as of the Completion
Date
will have, full legal and beneficial ownership over the Sale Shares,
and
is entitled to transfer the Sale Shares to the Purchaser on the
terms of
this Agreement without the consent of any third
party;
|
| (i) |
the
Seller is an “accredited investor” as defined pursuant to Regulation D of
the Securities Act of 1933, as amended. The Seller acknowledges
that the
Escrow Shares have not been registered and are “restricted securities,”
and there is no agreement between the Seller and PACT to register
the
Escrow Shares;
|
| (j) |
the
Company listed in Part I of Schedule 2 are all the present subsidiaries
of
the Holding Company;
|
| (k) |
the
information in Schedule 2 and Schedule 6 (List of games and products
and
related software, patents and trademarks) relating to the Companies
is
true and accurate in all respects;
|
| (l) |
the
list of third party loans taken by the Company and liens over the
Intellectual Property of the Company is true and accurate in all
respects
and the related documents in Schedule 5 are true and accurate copies
of
the same; and
|
| (m) |
each
of the Companies are duly incorporated and validly existing in
its
relevant jurisdiction of
incorporation.
|
| 6.1.2 |
The
Purchaser and PACT jointly and severally, represent, warrant and
undertake
to the Seller (to the extent that the provisions of this clause
shall
continue to have full force and effect notwithstanding Completion,
and
shall survive for one year thereafter and any Claim must be bought
by the
Seller within 6 months of the Seller first becoming aware of the
circumstances leading to such Claim) that the Purchaser and PACT
have and
will have full power and authority to enter into and perform this
Agreement (including the issue of the Escrow Shares) which constitute
or
when executed will constitute binding obligations on them in accordance
with their respective terms.
|
| 6.2 |
Undertakings
|
Each
of
the Companies will implement all the necessary financial control procedures,
certification and representation letters, as required by PACT’s management,
audit committee, independent auditor, the US SEC, and the USA, Hong Kong,China,
and their respective governments.
14
| 7. |
RESTRICTIONS
|
| 7.1 |
The
Companies, the Seller, and the Warrantor further severally undertake
to
the Purchaser that after the Completion
Date:
|
| (a) |
they
will not at any time hereafter make use of or disclose or divulge
to any
person other than to officers or employees of the Group and/or
PACT and
companies within the PACT group companies whose province it is
to know the
same or for the purposes of carrying on the Business of the Company,
any
information relating to the Companies or the subsidiaries other
than any
information properly available to the public or disclosed or divulged
pursuant to an order of a court of competent jurisdiction or as
required
pursuant to any applicable law or regulation and the Seller and
the
Holding Company undertake further that they shall not use any advantages
derivable from such confidential information for their business
or affairs
unless agreed otherwise by the
Purchaser;
|
| (b) |
they
will not at any time hereafter in relation to any trade, business
or
company use a name, or internet domain name including the word
or symbol,
or logo design Octavian
and PacificNet,
or any similar word and symbol in such a way as to be capable
of or likely
to be confused with the name of the Company and shall use all
reasonable
endeavors to procure that no such name shall be used by any person,
firm
or company with which it is/they are connected provided that
the Company
and its subsidiaries shall be entitled to use the name "Octavian"
for the
purposes of carrying out the
Business;
|
| (c) |
they
will procure that their subsidiaries, holding company (where applicable)
and any other affiliated companies and their employees will observe
the
restrictions contained in this Clause 7;
|
| (d) |
they
shall not do anything which is reasonably likely to prejudice the
goodwill
of the Companies or their
subsidiaries.
|
| 7.2 |
The
Holding Company undertakes that it will not, without the prior
written
consent of the Purchaser, for a period of 3 years after
Completion:
|
| (a) |
carry
on or be engaged or interested directly or indirectly in any business
which shall be in competition within Greater China and the USA
with the
Business of the Company or its subsidiaries as carried on at the
Completion Date;
|
| (b) |
solicit
or entice or endeavor to solicit or entice away from the Company
or its
subsidiaries, any employee, officer, manager or consultant of the
Company
or its subsidiaries; or
|
| (c) |
deal
with, canvass, solicit or approach or cause to be dealt with, canvassed,
solicited or approached for business in competition with the Business
carried on by the Company or its subsidiaries at Completion, any
person
who is or was in the previous 12 months, a customer, supplier or
client of
the Company or its subsidiaries.
|
| 7.3 |
Each
and every obligation under this clause shall be treated as a separate
obligation and shall be severally enforceable as such and in the
event of
any obligation or obligations being or becoming unenforceable in
whole or
in part, such part or parts as are unenforceable shall be deleted
from
this clause and any such deletion shall not affect the enforceability
of
all such parts of this clause as remain not so
deleted.
|
| 7.4 |
The
restrictions contained in this clause 7 are considered reasonable
by the
parties but in the event that any such restriction shall be found
to be
void but would be valid if some part thereof were deleted or the
area of
operation or the period of application reduced such restriction
shall
apply with such modification as may be necessary to make it valid
and
effective.
|
| 7.5 |
Nothing
in this Clause 7 shall apply to:
|
|
(a)
|
the
direct or indirect holding of any securities listed on a recognized
stock
exchange where the total voting rights exercisable at general meetings
of
the company concerned as represented by such holding do not exceed
10 per
cent of the total voting rights attaching to the securities of
the same
class as that held by the Companies, the Seller, and the Warrantor;
or
|
|
(b)
|
the
holding by the Companies, the Seller, and the Warrantor of any
securities
of any member of the Group; or
|
15
|
(c)
|
the
use or disclosure of any information which can be shown by Seller
to be in
the public domain (otherwise than in consequence of any breach
by any of
the Companies, the Seller, and the Warrantor of any provisions
of this
Agreement); or
|
|
(d)
|
the
carrying out of services pursuant to the ESA (and any subsequent
such
agreement); or
|
|
(e)
|
the
Company and its subsidiaries carrying on the
Business.
|
| 8. |
BOARD
OF DIRECTORS, OPERATION AND
MANAGEMENT
|
|
(a)
|
The
board of directors of each of the Companies shall be the highest
authority
of their respective Companies and shall determine all major issues
of the
respective Companies, subject to applicable
law.
|
|
(b)
|
The
board of directors of the Company will consist of Xxxxxx Xxxxxxxxxxxxxx,
Xxxx Xxxx and Xxxxxx Xxxx.
|
|
(c)
|
The
boards of directors shall meet at least once every quarter. A Board
meeting may be called by any
director.
|
| (d) |
Each
of the Companies shall establish an operation and management structure
to
be responsible for the daily operation and management of the respective
Companies. The board of directors of the Company shall appoint
officers of
each of the Companies that shall include one (1) General Manager,
one (1)
Vice General Manager, and one Chief Financial Officer. The appointment
of
the Chief Financial Officer shall be subject to the approval of
the
Seller.
|
| (e) |
The
task of the General Manager shall be to carry out the various resolutions
of the board of directors of the respective Companies and organize
and
direct the daily operation and management of the respective Company.
The
operation and management structure may consist of certain departments,
the
managers for which shall be responsible for the work of the relevant
departments, handle matters delegated by the General Manager and
the Vice
General Manager, and report to the General Manager and the Vice
General
Manager.
|
| (f) |
In
the event of grave or serious dereliction of duty, the General
Manager,
the Vice General Manager, and the Chief Financial Officer may be
removed
and replaced by the board of directors of the respective Companies
with a
resolution at any time.
|
| (g) |
For
so long as he serves as the Chief Executive Officer of the Company,
the
Seller warrants that he shall use all reasonable endeavours to
ensure that
the PACT Company-wide
Accounting, Financial and Internal Control Policies and Standard
Procedures (Schedule 4) and any related or additional SEC regulations
on
Internal Control (eg. SEC’s Xxxxxxxx-Xxxxx Act) will be followed and
implemented:
|
| (i) |
The
Company and Seller, hereby jointly agree to and accept the following
PacificNet Member Company Financial Accounting Monthly Reporting
and
Internal Control Requirements, and agree to all the PacificNet
financial
accounting and internal control requirements in accordance with
the terms
and conditions outlined in the PacificNet Accounting Policy, Code
of
Conducts and Code of Ethics. The Seller
agrees to perform to his best capability to fulfill all the job
duties as
listed in the above requirement list. Seller agrees to abide by
PacificNet’s monthly reporting requirements, and Seller agrees to use all
reasonable endeavours to provide all the required information according
to
PacificNet’s Member Company Financial Accounting Monthly Reporting And
Internal Control Requirements, as outlined in (h) to (t)
below:
|
|
(ii)
|
PacificNet
Member Company Financial Accounting Monthly Reporting And Internal
Control
Requirements, and Standard Operation Procedures:
(DocID:ACCT-050001)
|
16
| (h) |
Balance
Sheet, including detailed list of assets (*Required monthly, within
15
days after the end of each month)
|
|
(i)
|
Detailed
Profit & Loss Account (P&L) for the month and year-to-date. Must
include the MD&A section (MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN
OF OPERATION). (*Required monthly, within 15 days after the end
of each
month) Management must discuss and analyze the financial results.
The
Companies shall, in this MD&A section, report how they are performing
compared to last quarter, tax issues, etc. Must include Related
party
transactions (RPT), and Management's Discussion and
Analysis.
|
| (j) |
Cash
Flow Statement for the month, and year-to-date (*Required monthly,
within
15 days after the end of each
month)
|
|
(k)
|
Bank
statements as for the month, and corresponding bank reconciliation
statements (*Required monthly, within 15 days after the end of
each month)
(* Must provide certified true copy of original
statements)
|
|
(l)
|
Detailed
breakdown of Accounts Receivable (AR) and Accounts Payable (AP),
AR aging
reports and net of allowance for doubtful accounts, and consider
whether
any provision required. (*Required monthly, within 15 days after
the end
of each month)
|
|
(m)
|
Material
Contracts, Sales Agreements, Invoices, Purchase Orders, Legal Disputes
or
Lawsuits, Tenancy agreements, Labor Issues, Tax Issues. Any necessary
schedules and documents. (*Required monthly, within 15 days after
the end
of each month) (* Must provide certified true copy of original
documents)
|
|
(n)
|
Updated
Company Group Chart, including all subsidiaries, affiliates, joint
ventures, and related party companies, % ownership, list of shareholders,
directors and officers. Report of equity movement (number of shares,
options, warrants, any new issuance and transfer) for each member
company.
(*Required monthly, within 15 days after the end of each
month)
|
|
(o)
|
Minutes
of shareholders' and directors' meeting for each subsidiary and
affiliated
companies. Each company must hold a minimum of one Board of Directors
meeting per quarter to review the quarterly financial reports before
submitting to PacificNet Inc. for consolidation and auditors reviews.
(*Required quarterly, within 15 days after the end of each
quarter)
|
|
(p)
|
Revenue/Profit
forecast for the current and next quarter, and for the whole year.
(*Required quarterly, within 15 days after the end of each quarter.
Must
provide immediate update, revision if the Companies see an important
change in the forecast.)
|
|
(q)
|
Human
Resources (HR) report: must provide complete staff directory (including
consultants, contractors and part-time employees), name, title,
job
function/description, compensation (including salary, bonus, benefits,
reimbursement, stock and options), telephone, mobile, instant message
(MSN, SkypeID), job function, etc. Updated Employee Directory and
HR
Company Organization Chart. (*Required monthly, within 15 days
after the
end of each month)
|
|
(r)
|
Important
Business Development News, Press Releases, Events Announcements,
Media
Coverage
|
|
(s)
|
Implementation
of PacificNet Company-wide Standard Financial Accounting Software:
agree
to implement PACT company wide, standard financial accounting software,
intranet, VPN and office automation (OA) systems as required by
PacificNet.
|
|
(t)
|
Adoption
and proper display of PacificNet corporate identity, standard trade
name,
brand name, company name, symbol and signage, domain name, logo
and
trademark on all company facilities, printed materials, media coverage,
press releases, business cards and web sites as required by
PacificNet.
|
17
9.
INDEMNITY
The
Seller will indemnify and will keep indemnified and save harmless the Purchaser
(for itself and as trustee for the Companies) from and against any and all
losses, claims, damages (including lost profits, consequential damages,
interest, penalties, fines and monetary sanctions) liabilities and costs
incurred or suffered by the Purchaser by reason of, resulting from, in
connection with, or arising in any manner whatsoever out of the breach of
any
Warranties or covenants or the inaccuracy of any representation of the Seller
or
the Warrantor contained in this Agreement including, but not limited to,
any
diminution in the value of the assets of and any payment made or required
to be
made by the Purchaser or the Companies or any subsidiary and any costs and
expenses incurred as a result of such breach provided that the indemnity
contained in this clause 9 shall be without prejudice to any other rights
and
remedies available to the Purchaser hereunder, at law or in equity.
10. COSTS
The
costs
incurred by each party in relation to due diligence including auditing and
valuation appraisal costs, fairness opinion letter, legal costs, and expenses
and other incidental costs and disbursements in relation to negotiations
leading
up to the purchase of the Sale Shares and to the preparation, execution and
carrying into effect of this Agreement shall be borne by the party incurring
the
same.. The Company will pay the auditor of the Purchaser and PACT, Xxxxxx
&
Company, Inc. (“Xxxxxx”),
one-third of the audit cost for the full audit of the Company's financials
on
each of the 10th day, 40th day, and 70th day after the Completion Date. The
Seller and the Company undertake to cooperate and assist Xxxxxx and the
Purchaser and PACT to complete and file the audit report in an 8-K form to
be
filed with the US SEC within 70 days after the Completion Date.
11. COMPLETE
AGREEMENT
This
Agreement represents the entire and complete agreement between the parties
in
relation to the subject matter hereof and supersedes any previous agreement
whether written or oral in relation thereto. No variations to this Agreement
shall be effective unless made or confirmed in writing and signed by all
the
parties hereto.
12. SEVERABILITY
In
the
event that any provision of this Agreement is held to be unenforceable, illegal
or invalid by any court of competent jurisdiction, the validity, legality
or
enforceability of the remaining provisions shall not be affected nor shall
any
subsequent application of such provisions be affected. In lieu of any such
invalid, illegal or unenforceable provision, the parties hereto intend that
there shall be added as part of this Agreement a provision as similar in
terms
to such invalid, illegal or unenforceable provision as may be possible and
be
valid, legal and enforceable.
13. COUNTERPARTS
This
Agreement may be executed in counterparts with the same force and effect
as if
executed on a single document and all such counterparts shall constitute
one and
the same instrument.
14. NOTICES
Any
notice required to be given under this Agreement shall be sufficiently given
if
delivered in person, forwarded by registered post or sent by overnight
international couriers or facsimile transmission to the relevant party at
its
address, or fax number set out below (or such other address as the addressee
has
by five days prior written notice specified to the other parties):
To
the Purchaser:
Attn: Xxxxxx
Xxxx, President
Floor
23rd, Tower A, TimeCourt,
Xx.0
Xxxxxxxxxxxx,
Xxxxxxxx
Xxxxxxxx Xxxxxxx,
Xxxxx.
18
To
the Company, the Holding Company, the Seller, and the
Warrantor:
Attn: Xx.
Xxxxxx Xxxxxxxxxxxxxx
Xxxxxxxx
International Limited
Address:
Xxxx Xxxxx, 0-0 Xxxx Xxxxxx, Xxxxxxxxx,
Xxxxxx,
XX0 4 AW
United
Kingdom
Alternative
Address: Xx.0
Xxxxxxxxxx Xxxxxxxxxx, Xxxxx Xxxxxxxxxx, Xxxxxxxx, Xxxxxx
00. SETTLEMENT
OF DISPUTES
|
16.1
|
The
formation of this Agreement and its schedules, appendices and related
agreements, and the validity, interpretation, performance and settlement
of disputes thereof shall be governed by the laws of the Hong Kong
SAR.
|
|
16.2
|
Any
disputes arising out of or in connection with this Agreement shall
be
resolved through friendly consultations by the Parties; if no agreement
can be reached through consultations within thirty (30) days after
the
occurrence of such dispute, either Party shall have the right to
submit
such dispute to the International Economic and Trade Arbitration
Commission Hong Kong Branch for arbitration in Hong Kong in accordance
with its procedures of arbitration. The arbitral award shall be
final and
binding upon both Parties.
|
17.
GOVERNING LAW AND JURISDICTION
This
Agreement shall be governed by and construed in accordance with the laws
of Hong
Kong. The parties hereto hereby irrevocably submit to the non-exclusive
jurisdiction of the courts of Hong Kong.
19
IN
WITNESS WHEREOF,
each of
the Purchaser, the Holding Company, the Company and the Seller have duly
executed, or has caused to be duly executed by their respective officers
thereunto duly authorized, this Agreement as of the date first written
above.
THE
PURCHASER: PACIFICNET GAMES INTERNATIONAL CORPORATION
|
By:
|
/s/
Xxxxxx Xxxx
|
|
Name:
|
Xxxxxx
Xxxx
|
|
Title:
|
President
|
THE
COMPANY: OCTAVIAN INTERNATIONAL LIMITED
|
By:
|
/s/
Xxxxxx Xxxxxxxxxxxxxx
|
|
Name:
|
Harmen
Breninnkmeijer
|
|
Title:
|
THE
HOLDING COMPANY: EMPEROR HOLDINGS LIMITED
|
By:
|
/s/
Xxxxxx Xxxxxxxxxxxxxx
|
|
Name:
|
Harmen
Breninnkmeijer
|
|
Title:
|
Director
|
THE
SELLER AND WARRANTOR: ZIRIA ENTERPRISES LIMITED
|
By:
|
/s/
Xxxxxx Xxxxxxxxxxxxxx
|
|
Name:
|
Harmen
Breninnkmeijer
|
|
Title:
|
Director
|
PACIFICNET
INC.
|
By:
|
/s/
Xxxxxx Xxxx
|
|
Name:
|
Xxxxxx
Xxxx
|
|
Title:
|
President
|
20
SCHEDULE
1
PART
I: THE COMPANY SHAREHOLDERS AND SHARES
Company
Name: Octavian
International Limited
|
Name
of Shareholder (1)
|
Percentage
of Shares held by the Shareholder
|
|
Emperor
Holdings Limited
|
100%
|
PART
II: THE HOLDING COMPANY SHAREHOLDERS AND SHARES
Company
Name:
Emperor Holdings Limited
|
Name
of Shareholder (1)
|
Number
of Shares held by the Shareholder
|
|
Ziria
Enterprises Limited
|
2
|
PART
III: THE
SALE SHARES
Sale
Shares: 2
ordinary
shares of the Holding Company
21
SCHEDULE
2
Group
Companies
Part
1 Members
of the Group
|
Name of Group Company
|
Place of Incorporation
|
Company
Number
|
Registered Office
|
|||
|
Casino Amusement Technology Supplies Limited
|
United
Kingdom
|
04871087
|
19 –
00 Xxxxxx Xxxxx
Xxxxxxxx
Xxxx
Xxxxxxxx
Xxxxx
Xxxxx
0X0 8HD
United
Kingdom
|
|||
|
Octavian
International (Europe) Limited
|
United
Kingdom
|
05854626
|
Xxxx
Xxxxx
0-0
Xxxx Xxxxxx
Xxxxxxxxx
Xxxxxx
XX0 0XX
|
|||
|
Octavian
International Limited
|
United
Kingdom
|
4185988
|
19
– 00 Xxxxxx Xxxxx
Xxxxxxxx
Xxxx
Xxxxxxxx
Xxxxx
Xxxxx
0X0 8HD
United
Kingdom
|
|||
|
Octavian
International (Latin America) Limited
|
United
Kingdom
|
05854627
|
Xxxx
Xxxxx
0-0
Xxxx Xxxxxx
Xxxxxxxxx
Xxxxxx
XX0 0XX
|
|||
|
Octavian
Latin America S A
|
Columbia
|
830083714-7
|
Xxx.
0X Xx 00-00
Xxxxxx
000
Xxxxxx
Xxxxxxxx
|
|||
|
Xxxxxxxx
Xxxxx S.R.L.
|
Italy
|
03521410237
|
Xxx
xxxxx Xxxxxxxx 00
00000
Xxxxxx
Xxxxx
|
|||
|
Argelink
S.A.
|
Argentina
|
N/A
|
Tte.Gral.
Xxxxx 000
Xxxx
0
0000
Xxxxxxx Xxxxxxx
Xxxxxxxxx
|
|||
|
ISHIR
Octavian Technologies Private Limited
|
|
India
|
|
N/A
|
|
00-X/0,
Xxxxxxx Xxxxxx (Xxxx)
Xxx
Xxxxx 000000
Xxxxx
|
Part
2 Capital
Structure of Group
|
Name
of Group Company
|
Casino
Amusement Technology Supplies Limited
|
|
|
Issued
Share Capital
|
1,000
fully paid ordinary shares
|
|
|
Shares
Held by Company
|
100%
of the issued capital
|
|
|
Other
Shareholders and number of Shares Held
|
Nil
|
|
|
Other
Securities on Issue
|
Nil
|
|
|
Name
of Group Company
|
Octavian
International Limited
|
|
|
Issued
Share Capital
|
1,020
fully paid ordinary shares
|
|
|
Shares
Held by Company
|
100%
of the issued capital
|
|
|
Other
Shareholders and number of Shares Held
|
Nil
|
|
|
Other
Securities on Issue
|
Nil
|
|
|
Name
of Group Company
|
Octavian
International (Europe) Limited
|
|
|
Issued
Share Capital
|
1,000
fully paid ordinary shares
|
|
|
Shares
Held by Company
|
100%
of the issued capital
|
|
|
Other
Shareholders and number of Shares Held
|
Nil
|
|
|
Other
Securities on Issue
|
Nil
|
|
|
Name
of Group Company
|
Octavian
International (Latin America) Limited
|
|
|
Issued
Share Capital
|
1,000
fully paid ordinary shares
|
|
|
Shares
Held by Company
|
100%
of the issued capital
|
|
|
Other
Shareholders and number of Shares Held
|
Nil
|
|
|
Other
Securities on Issue
|
Nil
|
|
|
Name
of Group Company
|
Octavian
Latin America S A
|
|
|
Issued
Share Capital
|
2,000
ordinary shares paid to COL$50,000 and unpaid to COL$50,000
each
|
|
|
Shares
Held by Company
|
89.7%
of the issued capital, being 1,794 partly paid ordinary shares
|
2
|
Other
Shareholders and number of Shares Held
|
Xxxx
Xxxxxxx Xxxxxxxxxx L – 200 partly paid ordinary
shares
Xxxxxxxx
Xxxxxx Xxxxxxx – 2 partly paid ordinary shares
Xxxxx
Xxxx Xxxxxxxx – 2 partly paid ordinary shares
Xxxxxx
Xxxxxx Lara – 2 partly paid ordinary shares
|
|
|
Other
Securities on Issue
|
Nil
|
|
|
Name
of Group Company
|
Octavian
Italy S.R.L.
|
|
|
Issued
Share Capital
|
Euro
50,000 (issued and fully paid)
|
|
|
Shares
Held by Company
|
50%
of the issued capital, being one quota with a nominal value of
Euro
25,000
|
|
|
Other
Shareholders and number of Shares Held
|
Euro
Gruppo Giochi S.R.L – one quota with a nominal value of
Euro 25,000
|
|
|
Other
Securities on Issue
|
Nil
|
|
|
Name
of Group Company
|
Argelink
S.A.
|
|
|
Issued
Share Capital
|
12,000
fully paid ordinary shares
|
|
|
Shares
Held by Company
|
50%
of the issued capital, being 6,000 fully paid ordinary
shares
|
|
|
Other
Shareholders and number of Shares Held
|
Mediciones
Urbanas S.A. – 6,000 fully paid ordinary
shares
|
|
|
Other
Securities on Issue
|
Nil
|
|
|
Name
of Group Company
|
ISHIR
Octavian Technologies Private Limited
|
|
|
Issued
Share Capital
|
50,000
fully paid equity shares of 10 Rupees each
|
|
|
Shares
Held by Company
|
74.9%
of the issued capital, being 37,450 fully paid equity
shares of 10 Rupees each
|
|
|
Other
Shareholders and number of Shares Held
|
ISHIR
Infotech Private Limited - 12,550 fully paid equity shares of 10
Rupees
each
|
|
|
Other
Securities on Issue
|
|
Nil
|
Part
3 Officers
|
Name
of Group Company
|
Octavian
International Limited
|
|
|
Directors
|
Xxxxxx
Xxxxxxxxxxxxxx
Xxxx
Xxxxxxx
|
3
|
Secretary
|
Xxxxx
Xxxx (in process of being replaced)
|
|
|
Auditor
|
Xxxxx
Xxxxxxxx UK LLP
|
|
|
Name
of Group Company
|
Casino
Amusement Technology Supplies Limited
|
|
|
Directors
|
Xxxxxx
Xxxxxxxxxxxxxx
Xxxx
Xxxxxxx
Xxxx
Xxxx (in process of being replaced)
|
|
|
Secretary
|
FS
Secretarial Limited
|
|
|
Auditor
|
Xxxxx
Xxxxxxxx UK LLP
|
|
|
Name
of Group Company
|
Octavian
International (Europe) Limited
|
|
|
Directors
|
Xxxx
Xxxxxxx
|
|
|
Secretary
|
Xxxxx
Xxxxx
|
|
|
Auditor
|
Xxxxx
Xxxxxxxx UK LLP
|
|
|
Name
of Group Company
|
Octavian
International (Latin America) Limited
|
|
|
Directors
|
Xxxx
Xxxxxxx
|
|
|
Secretary
|
Xxxxx
Xxxxx
|
|
|
Auditor
|
Xxxxx
Xxxxxxxx UK LLP
|
|
|
Name
of Group Company
|
Octavian
Latin America S A
|
|
|
Directors
|
Xxxxxxxx
Xxxxxx Xxxxxxx
|
|
|
Secretary
|
July
Xxxxxx
|
|
|
Xxxxxxx
|
Xxxxxx
X Xx Xxxxx
|
0
|
Name
of Group Company
|
Octavian
Italy S.R.L.
|
|
|
Directors
|
Mauro
Crivellente
|
|
|
Secretary
|
EGG
personnel
|
|
|
Auditor
|
Not
required as to small under Italian civil codes
|
|
|
Name
of Group Company
|
Argelink
S.A.
|
|
|
Directors
|
Fabian
Xxxx Xxxxx
Xxxxxxxxxxx
Xxxx Xxxxxxx
|
|
|
Secretary
|
Xxxxx
Ubhaches
|
|
|
Auditor
|
Xxxx
Orzanco
|
|
|
Name
of Group Company
|
ISHIR
Octavian Technologies Private Limited
|
|
|
Directors
|
Xxxxxxxx
Xxxxxx
Xxxxx
Xxxxxx
Xxxxxxxx
Trond Xxxxxxxxx
Xxxxx
Xxxx XxXxx
|
|
|
Secretary
|
Not
yet appointed
|
|
|
Auditor
|
|
Xxxxx
X.X. Chopra
|
5
SCHEDULE
3
CONFIDENTIALITY,
NON-COMPETITION, AND NON-CIRCUMVENTION AGREEMENT
Dated
this 7th
day
of Dec. 2007.
Company
Name: OCTAVIAN INT. LTD.
Company
Address: 0-0 XXXX XXX. XXXXX X00 0XX U.K.
This
Confidentiality and Non-Circumvent Agreement (hereby referred to as the
Agreement) is made effective on the abovementioned date (the Effective Date)
between the abovementioned Companies and Pacificnet Games International
Corporation and PacificNet Inc., with an office located at Floor 23rd,
Tower
A, TimeCourt, Xx.0 Xxxxxxxxxxxx, Xxxxxxxx Xxxxxxxx Xxxxxxx, Xxxxx. (hereby
know
as the Parties).
Confidentiality
It
is
agreed and Understood that PacificNet own certain confidential and proprietary
information that the Company, from time to time, may need or may have acquired
in order to explore business or investment opportunity of mutual
interest.
Confidential
Information means any information and/or material which is proprietary to
PacificNet, whether or not owned or developed by PacificNet, which is not
generally know other than by PacificNet, and which either Party may obtain
through any direct or indirect contact with the other Party. Confidential
Information will be conspicuously identified when, or soon after, it is
originally disclosed, as “Confidential” or “Proprietary”.
Confidential
Information includes without limitation, business records and plans, customer
and partner lists, investor and investee lists, bank and lending lists, trade
secrets, pricing structures, business sources, computer programs, names and
expertise of employees and consultant and other technical, business, financial,
customer and product development plans, forecasts, strategies and information.
Confidential information does not include: matters of public knowledge;
information rightfully received by the Company from a third Party without
a duty
of confidentiality; information independently developed by either Party;
information disclosed by operation of law; information disclosed by PacificNet
with the prior written consent of the Company; and any other information
that
PacificNet agrees in writing is not confidential.
The
Company understands and acknowledges that Confidential Information has been
developed or obtained by PacificNet by the investment of significant time,
effort and expense, and that the Confidential Information is a valuable,
special
and unique asset of the respective Parties. Therefore, the Company agree
to hold
in confidence and not to disclose the Confidential Information to any person,
employee or entity [including their affiliates, subsidiaries, stockholders,
partners, trading partners and other associated organizations (herein referred
to as affiliates)][BRACKETS?] without the prior written consent of the other
Party that owns the Confidential Information for a period of three (3) years
from the Effective Date hereof unless Parties enter into a Relationship,
[NEED
TO DEFINE] in which case, this Agreement remains in effect for the term of
the
partnering agreement and after the termination of said partnering agreement
or
when all Confidential Information has been returned to its owner, whichever
occur first.
Immediately
upon the earlier of (i) the written request of the disclosing party or (ii)
the
termination of this Agreement, the receiving party will return to the disclosing
party all Confidential Information of the disclosing party and all documents
or
media containing any such Confidential Information and any and all copies
or
extracts thereof, which remain the property of the disclosing party at all
times.
Page
6 of
10
Non-Circumvention
Both
Parties agree that neither Party shall circumvent the other Party with regards
to any transaction resulting from the disclosure of Confidential Information
from one Party to the other Party. Specifically, but without limitation,
the
Company will not approach PacificNet’s business partner(s), potential
investor(s) and investee(s) in circumvention of PacificNet. Each Party undertake
not to directly contact deal with transact Business with or otherwise be
involved with any Corporation, Partnership, Proprietorship, Trust, Individual,
Affiliate, or other Entity introduced by either Party without the specific
written permission of the Introducing Party. In the event of circumvention
of
this agreement by either party, directly or indirectly, the circumvented
party
shall be entitled to legal monetary penalty equal to the maximum potential
investment return and service it should realize from such a transaction plus
any
and all expenses, including, but nut limited to, all legal costs and expenses
to
recover the lost revenue.
General
Provisions
This
Agreement sets forth the entire understanding of the Parties regarding
confidentiality and non-circumvention. Any amendments must be in writing
and
signed by both Parties. Each Party shall take reasonable steps to ensure
that
their Employees, Agents, Representatives, Officers, Independent Contractors
Shareholders, Principals, Affiliates, and other Third Parties– also – abide by
the provisions of this Agreement. This Agreement shall not be assignable
by
either Party, and neither Party may delegate its duties under this Agreement,
without prior written consent of the other Party. This Agreement shall remain
in
effect until canceled in writing by both Parties. This agreement creates
no
obligation to purchase, sell, develop, research or disclose anything. It
grants
no license or right to use proprietary technology. It creates no agency or
partnership. This agreement is governed by Minnesota and the US law. Injunctive
relief can be granted for any breach of the agreement, as money damages would
not cure the harm from the breach. It supersedes all prior nondisclosure
or
similar agreements between the parties as to the Proprietary Information
disclosed after the Effective Date. It binds the parties, their heirs,
successors, subsidiaries, associates, affiliates, and assignees. Any controversy
or claim arising out of this Agreement, which could not be settled amicably
between the Parties themselves, shall be decided by arbitration in accordance
with the International Chamber of Commerce (ICC) Rules of Arbitration and
the
Non-Circumvention and Non-Disclosure Laws and Provisions, in the nearest
Regional ICC Court of Administration. In any proceedings to interpret or
enforce
the agreement, the prevailing party shall receive from the other party costs
and
reasonable attorney fees, including costs and fees incurred in preparation
therefore and on appeal therefrom.
THE
PURCHASER: Company A Pacific Net Games International Corp. and
PacificNet Inc.
|
By:
|
/s/
Xxxxxx Xxxx
|
|
Name:
|
Xxxxxx
Xxxx
|
|
Title:
|
President
|
The
COMPANY:
| Octavian Int. Ltd. | |
|
By:
|
/s/
Xxxxxx Xxxxxxxxxxxxxx
|
|
Name:
|
Xxxxxx
Xxxxxxxxxxxxxx
|
|
Title:
|
CEO
|
Page
7 of
10
SCHEDULE
4
Internal
Control Agreement
SOX
Compliance Agreement
Escrow
Agreement
Page
8 of
10
SCHEDULE
5
List
of third party loans and charges
Loan
Agreement dated 20 June 2007 between eBet Limited and Octavian International
Limited (with drawdown notice)
Deed
of
Charge dated 15 August 2007 between Octavian International Limited and eBet
Limited (registered at Companies House on 23 August 2007)
Page
9 of
10
SCHEDULE
6
List
of games and products and related software, patents and
trademarks
Page
10
of 10
