-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, RBHwGN2sdQ9kY77tJGEIjiieIAsDTBWXFW2qCikSIf0PujjFKzHtzvFUOankxoSu knMjmnZG/WWF2vOAeBO7Mw== 0000950123-04-007463.txt : 20040617 0000950123-04-007463.hdr.sgml : 20040617 20040617113237 ACCESSION NUMBER: 0000950123-04-007463 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 20040617 GROUP MEMBERS: BRENTHURST LIMITED GROUP MEMBERS: BRENTHURST PRIVATE EQUITY II LIMITED GROUP MEMBERS: BRENTHURST PRIVATE EQUITY SOUTH AFRICA I LIMITED GROUP MEMBERS: THESEUS LIMITED SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: NET 1 UEPS TECHNOLOGIES INC CENTRAL INDEX KEY: 0001041514 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-BUSINESS SERVICES, NEC [7389] IRS NUMBER: 650903895 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-79903 FILM NUMBER: 04868116 BUSINESS ADDRESS: STREET 1: 507-700 WEST PENDER ST STREET 2: VANCOUVER BRITISH COLUMBIA CITY: CANADA V6C 1G8 STATE: A1 ZIP: 00000 BUSINESS PHONE: 8887962233 MAIL ADDRESS: STREET 1: 507-700 WEST PENDER ST STREET 2: VANCOUVER BRITISH COLUMBIA CITY: CANADA V6C 1G8 STATE: A1 ZIP: 00000 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: Maitland Trustees LTD CENTRAL INDEX KEY: 0001294003 IRS NUMBER: 000000000 STATE OF INCORPORATION: D8 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: 9 COLUMBUS CENTRE STREET 2: PELICAN DRIVE CITY: ROAD TOWN, TORTOLA STATE: D8 ZIP: PO BOX 805 BUSINESS PHONE: (1) 284-494-4567 MAIL ADDRESS: STREET 1: 9 COLUMBUS CENTRE STREET 2: PELICAN DRIVE CITY: ROAD TOWN, TORTOLA STATE: D8 ZIP: PO BOX 805 SC 13D 1 y98296sc13d.htm NET 1 UEPS TECHNOLOGIES, INC. NET 1 UEPS TECHNOLOGIES, INC.
 

SCHEDULE 13D

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 13D
(Rule 13d-101)

Under the Securities Exchange Act of 1934

NET 1 UEPS TECHNOLOGIES, INC.

(Name of Issuer)

Common Stock, Par Value $0.001 Per Share

(Title of Class of Securities)

64107N107

(Cusip Number)

John Whillis
c/o Maitland Trustees Limited
9 Columbus Centre, Pelican Drive
Road Town, Tortola, British Virgin Islands
(+44) 1624 630-000

With a copy to:
 
John W. Carr, Esq.
Simpson Thacher & Bartlett LLP
425 Lexington Avenue
New York, New York 10017
(212) 455-2000

(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

June 7, 2004

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box. o

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

Page 1 of 17 Pages

 

             
CUSIP No. 64107N107
  1. Name of Reporting Person:
Brenthurst Private Equity II Limited		 I.R.S. Identification Nos. of above persons (entities only):
  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) o  
    (b) x  
  3. SEC Use Only:
  4. Source of Funds (See Instructions):
AF
  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o
  6. Citizenship or Place of Organization:
British Virgin Islands
Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
11,000,000
8. Shared Voting Power:
None
9. Sole Dispositive Power:
11,000,000
10.Shared Dispositive Power:
None
  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
11,000,000
  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o
  13.Percent of Class Represented by Amount in Row (11):
8.69%
  14.Type of Reporting Person (See Instructions):
IC

Page 2 of 17 Pages

 

             
CUSIP No. 64107N107
  1. Name of Reporting Person:
Brenthurst Private Equity South Africa I Limited		 I.R.S. Identification Nos. of above persons (entities only):
  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) o  
    (b) x  
  3. SEC Use Only:
  4. Source of Funds (See Instructions):
AF
  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o
  6. Citizenship or Place of Organization:
British Virgin Islands
Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
6,000,000
8. Shared Voting Power:
None
9. Sole Dispositive Power:
6,000,000
10.Shared Dispositive Power:
None
  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
6,000,000
  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o
  13.Percent of Class Represented by Amount in Row (11):
4.74%
  14.Type of Reporting Person (See Instructions):
IC

Page 3 of 17 Pages

 

             
CUSIP No. 64107N107
  1. Name of Reporting Person:
Brenthurst Limited		 I.R.S. Identification Nos. of above persons (entities only):
  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) o  
    (b) x  
  3. SEC Use Only:
  4. Source of Funds (See Instructions):
AF
  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o
  6. Citizenship or Place of Organization:
British Virgin Islands
Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
17,000,000
8. Shared Voting Power:
None
9. Sole Dispositive Power:
17,000,000
10.Shared Dispositive Power:
None
  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
17,000,000
  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o
  13.Percent of Class Represented by Amount in Row (11):
13.43%
  14.Type of Reporting Person (See Instructions):
IC

Page 4 of 17 Pages

 

             
CUSIP No. 64107N107
  1. Name of Reporting Person:
Theseus Limited		 I.R.S. Identification Nos. of above persons (entities only):
  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) o  
    (b) x  
  3. SEC Use Only:
  4. Source of Funds (See Instructions):
AF
  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o
  6. Citizenship or Place of Organization:
British Virgin Islands
Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
17,000,000
8. Shared Voting Power:
None
9. Sole Dispositive Power:
17,000,000
10.Shared Dispositive Power:
None
  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
17,000,000
  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o
  13.Percent of Class Represented by Amount in Row (11):
13.43%
  14.Type of Reporting Person (See Instructions):
OO

Page 5 of 17 Pages

 

             
CUSIP No. 64107N107
  1. Name of Reporting Person:
Maitland Trustees Limited		 I.R.S. Identification Nos. of above persons (entities only):
  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) o  
    (b) x  
  3. SEC Use Only:
  4. Source of Funds (See Instructions):
AF
  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o
  6. Citizenship or Place of Organization:
British Virgin Islands
Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
17,000,000
8. Shared Voting Power:
None
9. Sole Dispositive Power:
17,000,000
10.Shared Dispositive Power:
None
  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
17,000,000
  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o
  13.Percent of Class Represented by Amount in Row (11):
13.43%
  14.Type of Reporting Person (See Instructions):
OO

Page 6 of 17 Pages

 

     This Statement on Schedule 13D relates to Common Stock, par value $0.001 per share (“Common Stock”), of Net 1 UEPS Technologies, Inc. (the “Issuer”). This Statement is being filed to report that, pursuant to a Common Stock Purchase Agreement (which is defined herein and more fully described in Item 6 below), the Reporting Persons (as defined herein) acquired beneficial ownership of the shares of Common Stock reported herein (the “Shares”).

Item 1. Security and Issuer.

     This Schedule 13D relates to the Shares. The address of the principal executive offices of the Issuer is Net 1 UEPS Technologies, Inc., Suite 325-744 West Hastings Street, Vancouver, British Columbia, Canada V6C 1A5.

Item 2. Identity and Background.

     This Schedule 13D is being filed on behalf of:

  (i)   Brenthurst Private Equity II Limited, a company organized in the British Virgin Islands (“BPE2”);
 
  (ii)   Brenthurst Private Equity South African I Limited, a company organized in the British Virgin Islands (“BPESA”);
 
  (iii)   Brenthurst Limited, a company organized in the British Virgin Islands(“Brenthurst”), in its capacity as the controlling shareholder of BPE2 and BPESA;
 
  (iv)   Theseus Limited, a company organized in the British Virgin Islands (“Theseus”), in its capacity as the parent company of Brenthurst;
 
  (v)   Maitland Trustees Limited, a company organized in the British Virgin Islands (“Maitland”), in its capacity as the parent company of Theseus (together with BPE2, BPESA, Brenthurst and Theseus, the “Reporting Persons”).

     This Schedule 13D relates to shares held by BPE2 and BPESA.

     The address and principal place of business of the Reporting Persons are 9 Columbus Centre, Pelican Drive, Road Town, Tortola, British Virgin Islands. Each of BPE2, BPESA and Brenthurst are principally engaged as investment holding companies. Each of Theseus and Maitland is engaged principally as trustee companies providing trustee services to international trusts.

Page 7 of 17 Pages

 

     Certain information regarding the Reporting Persons’ directors and executive officers is set forth in Annexes A and B hereto, which are incorporated by reference herein. The citizenships of all of these individuals are listed in Annexes A and B.

     During the last five years, neither the Reporting Persons nor any of the individuals listed in Annexes A and B has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors), or has been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction as a result of which any of them was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

Item 3. Source and Amount of Funds or Other Consideration.

     The amount of funds contributed by the Reporting Persons to purchase the Shares was $8.5 million. The source of the funds was capital contributions by Tabasheer Limited, a British Virgin Islands Company.

Item 4. Purpose of Transaction.

     The Shares held by the Reporting Persons were acquired as described in Item 6. The information set forth in Item 6 hereof is hereby incorporated by reference into this Item 4. The Reporting Persons currently hold the Shares for investment purposes. Except as otherwise disclosed herein, none of the Reporting Persons currently has any agreements, beneficially or otherwise, which would be related to or would result in any of the matters described in Items 4(a)-(j) of Schedule 13D; however, as part of the ongoing evaluation of this investment and investment alternatives, each Reporting Person may consider such matters and, subject to applicable law, may formulate a plan with respect to such matters, and, from time to time, each Reporting Person may hold discussions with or make formal proposals to management or the Board of Directors of the Issuer, other shareholders of the Issuer or other third parties regarding such matters.

Item 5. Interest in Securities of the Issuer.

     The information set forth in Item 6 hereof is hereby incorporated by reference into this Item 5.

     The filing of this Schedule 13D shall not be construed as an admission that any Reporting Person or any of their respective members, officers, employees, affiliates or partners, as applicable, are, for the purposes of Section 13(d) or Section 13(g) of the Securities Exchange Act of 1934, the beneficial owners of any securities covered by this Schedule 13D. In addition, the filing of this Schedule 13D shall not be construed as an admission that the Reporting Persons are the beneficial owners of any securities covered

Page 8 of 17 Pages

 

by this Schedule 13D for any purposes other than Section 13(d) or Section 13(g) of the Securities Act of 1934.

(a)   BPE2 beneficially owns 11,000,000 shares of Common Stock (approximately 8.69% of the total number of shares of Common Stock outstanding).
 
    BPESA beneficially owns 6,000,000 shares of Common Stock (approximately 4.74% of the total number of shares of Common Stock outstanding).
 
    Brenthurst, in its capacity as the controlling shareholder of each of BPE2 and BPESA, may be deemed to be the beneficial owner of 17,000,000 shares of Common Stock (approximately 13.43% of the total number of shares of Common Stock outstanding).
 
    Theseus, in its capacity as the parent company of Brenthurst, may be deemed to be the beneficial owner of 17,000,000 shares of Common Stock (approximately 13.43% of the total number of shares of Common Stock outstanding).
 
    Maitland, in its capacity as the parent company of Theseus, may be deemed to be the beneficial owner of 17,000,000 shares of Common Stock (approximately 13.43% of the total number of shares of Common Stock outstanding).
 
(b)   Brenthurst, in its capacity as sole shareholder of each of BPE2 and BPESA, has discretionary authority and control over all of the assets of each of BPE2 and BPESA, including the power to vote and dispose of the Issuer’s Shares. Therefore, Brenthurst may be deemed to have sole power to direct the voting and disposition of 17,000,000 shares of Common Stock.
 
    Theseus, in its capacity as the parent company of Brenhurst, has discretionary authority and control over all of the assets of Brenthurst, including the power to vote and dispose of the Issuer’s Shares. Therefore, Theseus may be deemed to have sole power to direct the voting and disposition of 17,000,000 shares of Common Stock.
 
    Maitland, in its capacity as the parent company of Theseus, has discretionary authority and control over all of the assets of Theseus, including the power to vote and dispose of the Issuer’s Shares. Therefore, Maitland may be deemed to have sole power to direct the voting and disposition of 17,000,000 shares of Common Stock.
 
(c)   Except as set forth in Item 6 below, the Reporting Persons have not effected or caused to be effected any transactions with respect to the Shares in the 60 days prior to the date hereof.

Page 9 of 17 Pages

 

(d)   The Reporting Persons are not aware of any other person with the right to receive the power to direct the receipt of dividends from, or the proceeds of the sale of, any of the Shares beneficially owned by them.
 
(e)   Not applicable.

Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer.

     Pursuant to a Common Stock Purchase Agreement, dated as of January 30, 2004 (the “Agreement”), between the Issuer and SAPEF III International G.P. Limited (“SAPEF G.P.”), the Issuer agreed to sell to SAPEF G.P. (or its nominees) 105,661,428 shares of Common Stock of the Issuer. A copy of the Agreement is attached hereto as Exhibit A and incorporated herein by reference thereto in response to this Item 6.

     Pursuant to an Assignment and Acceptance Agreement (“Assignment Agreement”), dated as of June 7, 2004, between SAPEF G.P., South African Private Equity Fund III, L.P. (“SAPEF III Fund”), Rose Nominees Limited (A/C 20423) (“Rose”), BPE2 and BPESA, SAPEF G.P. assigned to BPE2 and BPESA its right to purchase, respectively, 11,000,000 and 6,000,000 shares of Common Stock of the Issuer pursuant to the Agreement. A copy of the Assignment Agreement is attached hereto as Exhibit B and incorporated herein by reference thereto in response to this Item 6.

     Pursuant to an Underwriting Agreement (“Underwriting Agreement”), dated as of November 5, 2003, between SAPEF III Fund (represented by SAPEF G.P.), South African Private Equity Trust III and Newshelf 713 (Proprietary) Limited, SAPEF III Fund could be required to purchase shares of the Issuer that are not purchased by shareholders of Net 1 Applied Technology Holdings Limited. A copy of the Underwriting Agreement is attached hereto as Exhibit C and incorporated herein by reference thereto in response to this Item 6.

     Each of BPE2 and BPESA is a party to the Deed of Delegation and Assumption (“Deed of Delegation”), dated as of June 1, 2004, between SAPEF III Fund, South African Private Equity Trust III, Rose, BPE2, BPESA and other entities named therein, pursuant to which certain obligations of SAPEF III Fund under the Underwriting Agreement have been delegated to Rose, BPE2 and BPESA. A copy of the Deed of Delegation is attached hereto as Exhibit D and incorporated herein by reference thereto in response to this Item 6.

     The foregoing descriptions of the Agreement, Assignment Agreement, the Underwriting Agreement and the Deed of Delegation do not purport to be complete and are qualified in their entirety by the terms of those agreements, which are incorporated herein by this reference.

Page 10 of 17 Pages

 

     Except as described above and elsewhere in this Schedule 13D, as of the date hereof there are no other contracts, arrangements, understandings or relationships (legal or otherwise) among the parties named in Item 2 hereto and between such persons and any person with respect to any of the securities of the Issuer beneficially owned by BPE2 and BPESA.

Item 7. Material to be Filed as Exhibits.

     The Exhibit Index is incorporated herein by this reference.

Page 11 of 17 Pages

 

SIGNATURE

     After reasonable inquiry and to the best of my knowledge and belief, I certify that the information in this statement is true, complete and correct.

         
Date: June 17, 2004
        
 
        
    BRENTHURST PRIVATE EQUITY II LIMITED
 
        
  By:   /s/  Sir Chippendale Keswick
     
 
      Name:  Sir Chippendale Keswick
      Title:    Director
 
        
    BRENTHURST PRIVATE EQUITY SOUTH AFRICA I LIMITED
 
        
  By:   /s/  Sir Chippendale Keswick
     
 
      Name:  Sir Chippendale Keswick
      Title:    Director
 
        
    BRENTHURST LIMITED
 
        
  By:   /s/  Sir Chippendale Keswick
     
 
      Name:  Sir Chippendale Keswick
      Title:    Director
 
        
    THESEUS LIMITED
 
        
  By:   /s/  John Whillis
     
 
      Name:  John Whillis
      Title:    Director
 
        
    MAITLAND TRUSTEES LIMITED
 
        
  By:   /s/  John Whillis
     
 
      Name:  John Whillis
      Title:    Director

Page 12 of 17 Pages

 

Annex A

Brenthurst Limited

     The name, business addresses, and present principal occupations of the directors and executive officers of Brenthurst Limited are set forth below.

             
        Present Principal    
        Occupation or    
Name
   Business Address
   Employment
   Citizenship
Directors:            
             
Clifford T. Elphick   6 St. Andrews Road 2193, Parktown, South Africa   CEO, E. Oppenheimer & Son Group   South Africa
             
Sir Chippendale Keswick   1 Charterhouse Street, London EC1 N 6SA   Director of Companies   United Kingdom
             
Steven Georgala   6 Rue Adlophe Fischer, Luxembourg   Attorney   Luxembourg/South Africa
             
Dr. H.P. Kaul   26 Rue de-Marche-aux-herbes, Luxembourg   Banker   Germany
             
Julian Ogilvie Thompson   1 Charterhouse Street, London EC1 N 6SA   Retired   South Africa

Page 13 of 17 Pages

 

Annex B

Theseus Limited

     The name, business addresses, and present principal occupations of the directors and executive officers of Theseus Limited are set forth below.

             
        Present Principal    
        Occupation or    
Name
   Business Address
   Employment
   Citizenship
Directors:            
             
John Mills   6 Rue Adlophe Fischer, Luxembourg   Attorney   Ireland
             
John Whillis   Falcon Cliff, Palace Road, Douglas, Isles of Man, 1M1 3EF   Group Director   United Kingdom/Canada
             
Steven Georgala   6 Rue Adlophe Fischer, Luxembourg   Attorney   Luxembourg/South Africa
             
Rory Kerr   16 Windson Place, Dublin   Attorney   Ireland
             
Peter Wentzel   Falcon Cliff, Palace Road, Douglas, Isles of Man, 1M1 3EF   Attorney   South Africa
             
Rupert Worsdale   Falcon Cliff, Palace Road, Douglas, Isles of Man, 1M1 3EF   Attorney   United Kingdom
             
Alan Butler   Falcon Cliff, Palace Road, Douglas, Isles of Man, 1M1 3EF   Director   South Africa

Page 14 of 17 Pages

 

Exhibit Index

A.   Common Stock Purchase Agreement
 
B.   Assignment and Acceptance Agreement
 
C.   Underwriting Agreement
 
D.   Deed of Delegation and Assumption
 
E.   A written agreement relating to the filing of the joint acquisition statement as required by Rule 13d-1(k)(1) under the Securities Exchange Act of 1934, as amended

Page 15 of 17 Pages

EX-99.A 2 y98296exv99wa.txt STOCK PURCHASE AGREEMENT Exhibit A ================================================================================ COMMON STOCK PURCHASE AGREEMENT Between NET 1 UEPS TECHNOLOGIES, INC. And SAPEF III INTERNATIONAL G.P. LIMITED (OR ITS NOMINEES) Dated as of January 30, 2004 ================================================================================ TABLE OF CONTENTS
PAGE ARTICLE I AGREEMENT TO SELL AND PURCHASE 2 SECTION 1.1. Authorization of Shares 2 SECTION 1.2. Sale and Purchase 2 ARTICLE II CLOSING, DELIVERY AND PAYMENT 2 SECTION 2.1. Closing 2 SECTION 2.2. Delivery 2 ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY 3 SECTION 3.1. Organization, Good Standing and Qualification 3 SECTION 3.2. Capital Structure 3 SECTION 3.3. Authority; No Conflicts; Governmental Approvals. 4 SECTION 3.4. Reports and Financial Statements. 5 SECTION 3.5. Information Supplied 5 SECTION 3.6. Board Approval. 6 SECTION 3.7. Vote Required. T 6 SECTION 3.8. Litigation, Compliance with Laws 6 SECTION 3.9. Absence of Certain Changes or Events. 7 SECTION 3.10. Environmental Matters 7 SECTION 3.11. Intellectual Property. 7 SECTION 3.12. Brokers or Finders 8 SECTION 3.13. Taxes. 8 SECTION 3.14. Certain Contracts 8 SECTION 3.15. Employee Benefit Plans. 9 SECTION 3.16. Labor Matters. 9 SECTION 3.17. Affiliate Transactions 10 SECTION 3.18. Insurance. 10 SECTION 3.19. Opinion of the Company Financial Advisor. 10 ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE PURCHASER 10
i SECTION 4.1. Requisite Power and Authority 10 SECTION 4.2. Investment Representations 10 SECTION 4.3. Litigation 11 SECTION 4.4. No Broker 11 ARTICLE V COVENANTS OF THE COMPANY 11 SECTION 5.1. Ordinary Course of Business 11 SECTION 5.2. Access 13 SECTION 5.3. Creation of Subsidiaries for Certain Acquisitions 13 SECTION 5.4. Use of Proceeds 13 SECTION 5.5. Efforts 14 SECTION 5.6. Notification of Certain Matters 14 SECTION 5.7. Regulatory and Other Authorizations; Notices and Consents 14 SECTION 5.8. Appointment of Directors 14 SECTION 5.9. Stockholder Approval 15 SECTION 5.10. The Registration Rights Agreement 15 SECTION 5.11. Convertible Preference Stock 15 ARTICLE VI CONDITIONS TO CLOSING 15 SECTION 6.1. Conditions to the Purchaser's Obligation 15 SECTION 6.2. Conditions to Obligations of the Company 17 ARTICLE VII SURVIVAL OF REPRESENTATIONS, WARRANTIES, COVENANTS; INDEMNIFICATION 17 SECTION 7.1. Survival. 17 SECTION 7.2. Exclusivity 18 SECTION 7.3. Indemnification. 18 SECTION 7.4. Method of Asserting Claims 19 ARTICLE VIII Certain Agreements 20 SECTION 8.1. Financial Statements and Other Reports 20 ARTICLE IX MISCELLANEOUS 22 SECTION 9.1. Other Definitions 22 SECTION 9.2. Governing Law; Jurisdiction; Waiver of Jury Trial 27 SECTION 9.3. Successors and Assigns; Assignment 27
ii SECTION 9.4. No Reliance 27 SECTION 9.5. Entire Agreement; Supersedes Prior Agreement 27 SECTION 9.6. Severability 27 SECTION 9.7. Amendment and Waiver 27 SECTION 9.8. Delays or Omissions 27 SECTION 9.9. Notices 28 SECTION 9.10. Expenses 29 SECTION 9.11. Titles and Subtitles 29 SECTION 9.12. Termination 29 SECTION 9.13. Counterparts; Execution by Facsimile Signature 29 Schedules Schedule 3.17 --- Disclosure Schedule Exhibits Exhibit A -- Articles of Amendment to the Articles of Incorporation of the Company Exhibit B -- Form of Opinion of Counsel to the Company
iii COMMON STOCK PURCHASE AGREEMENT COMMON STOCK PURCHASE AGREEMENT (this "Agreement"), dated as of January 30, 2004, between NET 1 UEPS TECHNOLOGIES, INC., a Florida corporation (the "Company"), and SAPEF III INTERNATIONAL G.P. LIMITED, a British Virgin Islands company and its nominees (together, with its nominees, the "Purchaser"). RECITALS WHEREAS, pursuant to a Sale Agreement dated October 31, 2003 among Aplitec (as defined herein), Net 1 Investment Holdings (Proprietary) Limited, Net 1 Support Services (Proprietary) Limited and New Aplitec (as defined herein) (the "Aplitec Acquisition Agreement"), the Company intends to acquire, through a wholly owned subsidiary, substantially all of the assets and liabilities of Aplitec (the "Aplitec Acquisition"); WHEREAS, the Company intends to amend its Articles of Incorporation in the form attached hereto as Exhibit A (the "Amendment") to (i) increase the maximum number of the Company's authorized shares of the Common Stock, par value $0.001 per share (the "Common Stock") from 100,000,000 shares to 500,000,000 shares, (ii) increase the authorized shares of preferred stock (the "Preferred Stock") from 3,000,000 to 300,000,000 and (iii) set forth the designations, preferences, conversion rights, cumulative, relative, participating, optional or other rights, including voting rights, qualifications, limitations or restrictions thereof as shall be stated and expressed in the resolution providing for the creation and issuance of such series of Preferred Stock as adopted by the Board of Directors pursuant to the authority of Article IV of the Articles of Incorporation; WHEREAS, the Amendment requires approval from the majority of the unaffiliated holders of shares of Common Stock ("Stockholder Approval"); WHEREAS, subject to obtaining the Stockholder Approval, the Company has authorized the sale and issuance of an aggregate of 105,661,428 shares of its Common Stock, and 192,967,138 shares of its Special Convertible Preference Stock, par value $0.001 per share (the "Convertible Preference Stock"); WHEREAS, the Company intends to use a portion of the proceeds from the sale of shares of Common Stock in connection with the Aplitec Acquisition, which portion will be in a certain dollar amount equal to 229,814,997 South African Rand on the date of payment for the shares of Common Stock as contemplated herein and for which will constitute a suspensive condition in the Aplitec Acquisition Agreement, and the balance of the proceeds will be used for working capital and general corporate purposes of the Company, which is not a suspensive condition under the Aplitec Acquisition Agreement; 1 WHEREAS, the Purchaser initially desires to purchase shares of Common Stock, on the terms and conditions set forth herein; and WHEREAS, the Company desires to issue and sell such shares of Common Stock to the Purchaser on the terms and conditions set forth herein; NOW, THEREFORE, in consideration of the foregoing recitals and the mutual promises hereinafter set forth, the parties hereto agree as follows: ARTICLE I AGREEMENT TO SELL AND PURCHASE SECTION 1.1. Authorization of Shares. The Company, subject to Stockholder Approval, has authorized (i) the initial sale and issuance to the Purchaser of 105,661,428 shares of Common Stock (the "Firm Shares"), subject to the Stockholder Approval, (ii) the issuance of up to 192,967,138 shares of Convertible Preference Stock in connection with the Aplitec Acquisition, and (iii) the issuance of up to 192,967,138 shares of Common Stock upon conversion of the shares of Convertible Preference Stock (the "Conversion Shares"). The Convertible Preference Stock shall have the rights, preferences, privileges and restrictions set forth in the Amendment. SECTION 1.2. Sale and Purchase. Subject to the terms and conditions hereof, the Company hereby agrees to issue and sell to the Purchaser, and the Purchaser agrees to purchase from the Company, the Firm Shares for the consideration of (i) cash in the amount of $0.50 per Firm Share and (ii) the procurement of the assignment of all the issued and outstanding capital stock of New Aplitec. Subject to the terms and conditions hereof, the Company will issue and sell to the Purchaser and the Purchaser will purchase from the Company, at the Closing, 105,661,428 Firm Shares. ARTICLE II CLOSING, DELIVERY AND PAYMENT SECTION 2.1. Closing. The closing of the sale and purchase of the Firm Shares under this Agreement (the "Closing"), shall take place on the 12th business day after the satisfaction or waiver of the conditions set forth in Section 6, at the offices of Simpson Thacher & Bartlett LLP, 425 Lexington Avenue, New York, New York 10017, or at such other time or place as the Company and the Purchaser may mutually agree (such date for the purchase of the Firm Shares is hereinafter referred to as the "Closing Date"). SECTION 2.2. Delivery. At the Closing, subject to the terms and conditions hereof, the Company will deliver to the Purchaser all of the Firm Shares to be purchased in accordance with Section 1.2 at the Closing, by delivery of a certificate or certificates evidencing the Firm Shares to be purchased at such Closing, free and clear of any encumbrances (other than those placed thereon by or on behalf of the Purchaser), and the Purchaser will make payment to the Company of the aggregate purchase price therefor by wire transfer of immediately available 2 funds to an account designated by the Company at least two business days prior to the applicable Closing Date. ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY SECTION 3.1. Organization, Good Standing and Qualification. (a) The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Florida, has the requisite power and authority to own, lease and operate its properties and to carry on its business as now conducted, except where the failure to be so organized, existing and in good standing or to have such power and authority would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect (as defined herein) on the Company, and is duly qualified and in good standing to do business in each jurisdiction in which the nature of its business or the ownership or leasing of its properties makes such qualification necessary, other than in such jurisdictions where the failure so to qualify or to be in good standing would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on the Company. The copies of the Articles of Incorporation and By-laws of the Company which were previously furnished or made available to the Purchaser are true, complete and correct copies of such documents as in effect on the date of this Agreement. The Company is not in default in the performance, observation or fulfillment of its Articles of Incorporation or By-laws, and except for the Amendment, no amendments to the Company's Articles of Incorporation or By-laws are currently pending. The minute books and other corporate records of the Company are complete and accurate in all material respects and contain all resolutions and other appropriate documents ratifying the actions of the Company to the date of this Agreement. The stock records of the Company are true and complete. The Company has made true, complete and correct copies or originals of all such documents available for review and inspection by the Purchaser and its representatives. (b) The Company has no Subsidiaries. SECTION 3.2. Capital Structure. (a) As of the date of this Agreement, the authorized capital stock of the Company consists of (A) 100,000,000 shares of Company Common Stock, of which 15,852,856 shares were outstanding as of the date hereof, (B) 3,000,000 shares of Preferred Stock, $.10 par value per share, of which no shares of are outstanding. Since December 31, 2002 to the date of this Agreement, there have been no issuances of shares of the capital stock of the Company or any other securities of the Company. All issued and outstanding shares of the capital stock of the Company are duly authorized, validly issued, fully paid and nonassessable, and no capital stock is entitled to preemptive rights. There were outstanding as of the date hereof no options, warrants or other rights to acquire capital stock from the Company. No options or warrants or other rights to acquire capital stock from the Company have been issued or granted since December 31, 2002 to the date of this Agreement. (b) No bonds, debentures, notes or other indebtedness of the Company having the right to vote on any matters on which stockholders may vote are issued or outstanding. 3 (c) Except as otherwise set forth in this Section, as of the date of this Agreement, there are no securities, options, warrants, calls, rights, commitments, agreements, arrangements or undertakings of any kind to which the Company is a party or by which it is bound obligating the Company to issue, deliver or sell, or cause to be issued, delivered or sold, additional shares of capital stock or other voting securities of the Company or obligating the Company to issue, grant, extend or enter into any such security, option, warrant, call, right, commitment, agreement, arrangement or undertaking. As of the date of this Agreement, there are no outstanding obligations of the Company to repurchase, redeem or otherwise acquire any shares of capital stock of the Company. (d) After giving effect to the Aplitec Acquisition and the transactions contemplated in this Agreement and the Aplitec Acquisition Agreement, there will be outstanding 121,514,284 shares of Common Stock and 192,967,138 shares of Convertible Preferred Stock. SECTION 3.3. Authority; No Conflicts; Governmental Approvals. (a) The Company has all requisite corporate power and authority to enter into this Agreement and to consummate the transactions contemplated hereby, subject to the Shareholder Approval referred to in Section 3.7. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of the Company, subject to the adoption of the Amendment by the Stockholder Approval. This Agreement has been duly executed and delivered by the Company and, assuming that this Agreement constitutes the valid and binding agreement of the Purchaser, constitutes a valid and binding agreement of the Company, enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and similar Laws (as defined herein) relating to or affecting creditors generally or by general equity principles (regardless of whether such enforceability is considered in a proceeding in equity or at Law) or by an implied covenant of good faith and fair dealing. (b) The execution and delivery of this Agreement by the Company does not, and the other transactions contemplated hereby will not, conflict with, or result in a Violation pursuant to: (A) any provision of the Articles of Incorporation or By-laws of the Company or (B) subject to obtaining or making the consents, approvals, Orders, authorizations, registrations, declarations and filings referred to in paragraph (c) below, any loan or credit agreement, note, mortgage, bond, indenture, lease, benefit plan or other agreement, obligation, instrument, Permit (as defined herein), Law or Order (as defined herein) applicable to the Company or any Subsidiary of the Company or their respective properties or assets. (c) No consent, approval, Order or authorization of, or registration, declaration or filing with, any Governmental Entity (as defined herein) is required by or with respect to the Company in connection with the execution and delivery of this Agreement by the Company and the consummation of the other transactions contemplated hereby, except for those required under or in relation to (A) the Florida Business Corporation Act (the "Florida Statute") with respect to the filing of the Amendment, (B) the filing of a proxy statement with respect to the Stockholder Approval with the SEC under the Securities and Exchange Act of 1934, as 4 amended (the "Exchange Act"), which proxy statement will also constitute the prospectus for the Registration Statement on Form S-4 referred to in clause (C) (the "Proxy Statement/Prospectus") and (C) the filing of a registration statement of the Company on Form S-4 with the SEC (the "Form S-4") under the Securities Act of 1933, as amended, (the "Securities Act") with respect to the issuance of the shares of Convertible Preference Stock and the shares of Common Stock issuable upon conversion of such shares of Convertible Preference Stock, and the declaration by the SEC of the Form S-4 effective, and (D) such consents, approvals, Orders, authorizations, registrations, declarations and filings the failure of which to make or obtain would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on the Company. SECTION 3.4. Reports and Financial Statements. (a) The Company and its controlling stockholders have filed all required registration statements, prospectuses, reports, schedules, forms, statements and other documents required to be filed by it with the SEC since January 1, 2001 (collectively, including all exhibits thereto, the "SEC Reports"). None of the SEC Reports, as of their respective dates (and, if amended or superseded by a filing prior to the date of this Agreement or the Closing Date, then on the date of such filing), contained or will contain any untrue statement of a material fact or omitted or will omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. The SEC Reports and any public announcements made by the Company after the date hereof as of the date of filing or announcement, as applicable, will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances, not misleading. Each of the financial statements (including the related notes) included in the SEC Reports presents fairly, in all material respects, the consolidated financial position and consolidated results of operations and cash flows of the Company as of the respective dates or for the respective periods set forth therein, all in conformity with GAAP (as defined herein) applied on a consistent basis throughout the periods involved except as otherwise noted therein, and subject, in the case of the unaudited interim financial statements, to normal and recurring adjustments that were not or are not expected to be material in amount, and lack of footnote disclosure. All of such SEC Reports, as of their respective dates (and as of the date of any amendment to the respective SEC Report), complied as to form in all material respects with the applicable requirements of the Securities Act and the Exchange Act. (b) Except as disclosed in the SEC Reports filed prior to the date hereof, the Company has not incurred any liabilities or obligations (whether or not accrued, contingent or otherwise) that are of a nature that would be required to be disclosed on a balance sheet of the Company or the footnotes thereto prepared in conformity with GAAP, other than (A) liabilities incurred in the ordinary course of business or (B) liabilities that would not, in the aggregate, reasonably be expected to have a Material Adverse Effect on the Company. SECTION 3.5. Information Supplied. (a) None of the information supplied or to be supplied by the Company for inclusion or incorporation by reference in (A) the Form S-4 will, at the time the Form S-4 is filed 5 with the SEC, at any time it is amended or supplemented or at the time it becomes effective under the Securities Act, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, and (B) the Proxy Statement/Prospectus will, on the date it is first mailed to the Company stockholders or at the time of the stockholders meeting at which the stockholders will vote to on the matters as set forth in the Proxy Statement/Prospectus, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The Proxy Statement/Prospectus will comply as to form in all material respects with the requirements of the Exchange Act and the Securities Act and the rules and regulations of the SEC thereunder. (b) Notwithstanding the foregoing provisions of this Section 3.5(b), 2no representation or warranty is made by the Company with respect to statements made or incorporated by reference in the Form S-4 or the Proxy Statement/Prospectus based on information supplied by (i) the Purchaser or (ii) Aplitec (as defined herein) in connection with the Aplitec Acquisition (as defined herein). SECTION 3.6. Board Approval. The Board of Directors of the Company, by resolutions duly adopted by vote of those voting at a meeting duly called and held and not subsequently rescinded or modified in any way, has duly (i) determined that this Agreement is advisable, fair to and in the best interests of the Company and its stockholders, (ii) approved this Agreement and the transactions contemplated hereby, including the Aplitec Acquisition Agreement, (iii) opted-out of Section 607.0902 of the Florida Statute (regarding control-share acquisitions), (iv) determined that the filing of the Amendment with the State of Florida Department of State is in the best interest of the Company in connection with the terms of this Agreement, and (v) approved the designation of shares of Convertible Preference Stock as set forth in the Amendment. No state takeover statute or other similar statute is applicable to this Agreement or the other transactions contemplated hereby, including Section 607.0901 of the Florida Statute (regarding affiliated transactions) and 607.0902 of the Florida Statute (regarding control-share acquisitions). SECTION 3.7. Vote Required. The affirmative vote of the majority of holders of Common Stock who cast votes to approve the Amendment is the only vote of the holders of any class or series of the Company capital stock necessary to adopt this Agreement and approve the filing of the Amendment and the other transactions contemplated hereby. SECTION 3.8. Litigation, Compliance with Laws. (a) There is no suit, action, investigation or proceeding pending or, to the Knowledge (as defined herein) of the Company, threatened, against or affecting the Company, nor is there any Order of any Governmental Entity (as defined herein) or arbitrator outstanding against the Company. (b) Except as disclosed in the SEC Reports filed prior to the date of the Agreement and except as would not reasonably be expected to have a Material Adverse Effect on the Company, the Company holds all Permits necessary for the operation of the Businesses of the 6 Company, taken as a whole. The Company is in compliance with the terms of each such Permit, except where the failure to so comply would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on the Company. Except as disclosed in the SEC Reports filed prior to the date of this Agreement, the business of the Company is not being conducted in violation of, and the Company has not received any notices of violations with respect to, any Law of any Governmental Entity, except for possible violations which would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on the Company. SECTION 3.9. Absence of Certain Changes or Events. Except for liabilities incurred in connection with this Agreement or the transactions contemplated hereby and except as disclosed in the SEC Reports filed prior to the date of this Agreement, since June 30, 2003, the Company has conducted its business only in the ordinary course and there has not been (i) any change, circumstance or event which has had, or would reasonably be expected to have, a Material Adverse Effect on the Company or (ii) any action taken by the Company during the period from June 30, 2003 through the date of this Agreement that, if taken during the period from the date of this Agreement through the Closing Date, would have constituted a breach of Section 5.1. SECTION 3.10. Environmental Matters. Except as would not reasonably be expected to have a Material Adverse Effect on the Company, (i) the operations of the Company have been and are in compliance with all applicable Environmental Laws (as defined herein) and with all Environmental Permits (as defined herein), (ii) there are no pending or, to the Knowledge of the Company, threatened, actions, suits, claims, investigations or other proceedings under or pursuant to Environmental Laws against the Company or, to the Knowledge of the Company, involving any real property currently or formerly owned, operated or leased by the Company, (iii) the Company is not subject to any Environmental Liabilities (as defined herein) and, to the Knowledge of the Company, no facts, circumstances or conditions relating to, arising from, associated with or attributable to any real property currently or formerly owned, operated or leased by the Company or operations thereon would reasonably be expected to result in Environmental Liabilities, (iv) all real property owned and all real property operated or leased by the Company is free of Hazardous Materials (as defined herein) in conditions and concentrations that would reasonably be expected to have an adverse effect on human health or the environment and the Company has disposed of any Hazardous Materials on or about such premises, and (v) no release, discharge, spillage or disposal of any Hazardous Material and no soil, water or air contamination by any Hazardous Material has occurred or is occurring in, from or on such premises the result of which would have a Material Adverse Effect on the Company. SECTION 3.11. Intellectual Property. Except as would not reasonably be expected to have a Material Adverse Effect on the Company, (a) the Company owns, or is licensed to use (in each case, free and clear of any Liens), all Intellectual Property (as defined herein) used in or necessary for the conduct of its business as currently conducted; (b) to the Knowledge of the Company, the use of any Intellectual Property by the Company does not infringe on or otherwise violate the rights of any Person and is in accordance with any applicable license pursuant to which the Company acquired the right to use any Intellectual Property; (c) to the Knowledge of the Company, no Person is challenging or infringing on or otherwise violating any right of the Company with respect to any Intellectual Property owned by or licensed to the 7 Company; and (d) the Company has not received any written notice of any pending claim with respect to any Intellectual Property used by the Company and to the Knowledge of the Company no Intellectual Property owned or licensed by the Company is being used or enforced in a manner that would result in the abandonment, cancellation or unenforceability of such Intellectual Property. Each of the Technology Agreements (as defined herein) is in full force and effect and there is no Violation of any of such Technology Agreements. SECTION 3.12. Brokers or Finders. No agent, broker, investment banker, financial advisor or other firm or Person is or will be entitled to any broker's or finder's fee or any other similar commission or fee in connection with any of the transactions contemplated by this Agreement, based upon arrangements made by or on behalf of the Company, except for Brait Advisory Services Limited ("BAS") appointed by Letter of Appointment dated April 25, 2003, whose fees and expenses will be paid by the Company in accordance with the Company's agreements with such firm, copies of which have been provided to the Purchaser. SECTION 3.13. Taxes. The Company (i) has prepared in good faith and duly and timely filed (taking into account any extension of time within which to file) all material Tax Returns (as defined herein) required to be filed by any of them and all such filed Tax Returns are complete and accurate in all material respects; (ii) has paid all Taxes (as defined herein) that are shown as due and payable on such filed Tax Returns or that the Company is obligated to pay without the filing of a Tax Return; (iii) has paid all other assessments received to date in respect of Taxes other than those being contested in good faith for which provision has been made in accordance with GAAP on the most recent balance sheet included in the Company's Annual Report on Form 10-KSB for the year ended December 31, 2002; (iv) has withheld from amounts owing to any employee, creditor or other Person (as defined herein) all Taxes required by law to be withheld and have paid over to the proper governmental authority in a timely manner all such withheld amounts to the extent due and payable; (v) has not waived any applicable statute of limitations with respect to United States federal or state income or franchise Taxes and have not otherwise agreed to any extension of time with respect to a United States federal or state income or franchise Tax assessment or deficiency; (vi) has never been members of any consolidated group for income tax purposes; and (vii) is not party to any tax sharing agreement or arrangement. No Liens for Taxes exist with respect to any of the assets or properties of the Company, except for statutory Liens for Taxes not yet due or payable or that are being contested in good faith. The Company has made available to the Purchaser true and correct copies of the United States federal income Tax Returns filed by the Company for each of the years ended December 31, 2001 and 2002. There is no contract or agreement, plan or arrangement by the Company covering any Person that, individually or collectively, could give rise to the payment of any amount that would not be deductible by the Company by reason of Section 280G of the Code or would constitute compensation in excess of the limitation set forth in Section 162(m) of the Code. There are not being conducted or, to the Knowledge of the Company, threatened in writing any material audits, examinations, investigations, litigation, or other proceedings in respect of Taxes of the Company. The Company has not been a party to a Section 355 transaction that could give rise to a Tax liability pursuant to Section 355(e) of the Code. SECTION 3.14. Certain Contracts. 8 (a) The Disclosure Schedule attached hereto as Schedule 3.13 (the "Disclosure Schedule") lists, as of the date hereof, each of the following contracts, agreements or arrangements to which the Company is a party or by which it is bound: (i) any contract for the purchase or sale of services, materials, products or supplies which involve aggregate payments by the Company of more than $10,000 for each such agreement or involve aggregate payments to the Company of more than $10,000 for each such agreement or other statutory or regulatory requirements), (ii) promissory notes, loans, agreements, indentures, evidences of indebtedness or other instruments providing for the lending of money, whether as borrower, lender or guarantor (excluding trade payables or receivables arising in the ordinary course of business), (iii) any contract or other agreement restricting the payment of dividends or the repurchase of stock or other equity, (iv) employment agreements, (v) change in control or similar arrangements with any officers, employees or agents of the Company that will result in any obligation (absolute or contingent) to make any payment to any officers, employees or agents of the Company following either the consummation of the transactions contemplated hereby, termination of employment, or both, (vi) labor contracts, (vii) joint venture, partnership agreements or other similar agreements, (viii) any contract for the pending acquisition, directly or indirectly (by merger or otherwise), of any entity or business, (ix) any contract, agreement or policy for reinsurance, (x) any contract or agreement that is material to the business, assets or condition (financial or otherwise) of the Company taken as a whole, or (xi) any non-competition agreement or any other agreement or arrangement that limits or otherwise restricts the Company or any successor thereto or that would, after the Closing Date, limit or restrict the Purchaser or any of its affiliates or any successor thereto, from engaging or competing in any line of business or in any geographic area (collectively, the "Material Contracts"). (b) The Company is not, nor has it received any notice or has any Knowledge that any other party is, in default (or would be in default but for the lapse of time or the giving of notice or both) in any respect under any such Material Contract, except for those defaults which could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on the Company. SECTION 3.15. Employee Benefit Plans. (a) The Company has no Benefit Plan (as defined herein), stock purchase, stock option, severance, employment, change-in-control, fringe benefit, collective bargaining, bonus, incentive, deferred compensation and all other employee benefit plans, agreements, programs, policies or other arrangements, whether or not subject to ERISA, whether formal or informal, oral or written, legally binding or under which any employee or former employee of the Company or any of its Subsidiaries has any present or future right to benefits or under which the Company or any of its Subsidiaries has any present or future liability. (b) No Company Plan (as defined herein) exists which could result in the payment to any employee of the Company of any money or other property or rights or accelerate or provide any other rights or benefits to any such employee as a result of the transactions contemplated by this Agreement. SECTION 3.16. Labor Matters. 9 The Company has only one employee. SECTION 3.17. Affiliate Transactions. Except as disclosed in Schedule 3.13, there are no contracts, commitments, agreements, arrangements or other transactions between the Company, on the one hand, and any Affiliate of the Company or any of its Subsidiaries, on the other hand. SECTION 3.18. Insurance. The Company has provided or made available to the Purchaser true, correct and complete copies of all policies of insurance to which the Company is a party or is a beneficiary or named insured. The Company maintains insurance coverage with reputable insurers in such amounts and covering such risks as are in accordance with normal industry practice for companies engaged in businesses similar to that of the Company (taking into account the cost and availability of such insurance). SECTION 3.19. Opinion of the Company Financial Advisor. The Board of Directors of the Company has received the opinion of Stenton Leigh Capital Corporation (the "Company Financial Advisor"), dated the date of this Agreement, to the effect that, as of such date, the consideration to be paid for the Firm Shares is fair, from a financial point of view, to the holders of Company Common Stock (other than the Purchaser and its Affiliates), copy of which opinion will promptly be made available to the Purchaser after receipt by the Company. ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE PURCHASER The Purchaser hereby represents and warrants to the Company as follows: SECTION 4.1. Requisite Power and Authority. The Purchaser has all requisite power and authority to execute and deliver this Agreement to consummate the transactions contemplated hereby and to perform its obligations hereunder. All action on the Purchaser's part necessary for the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby and the performance of all obligations of the Purchaser hereunder as of the Closing has been or will be effectively taken prior to the Closing. This Agreement has been or will be duly executed and delivered by the Purchaser. This Agreement (assuming due execution and delivery by the Company) will be legal, valid and binding obligations of the Purchaser, enforceable against it in accordance with their terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating to or affecting creditors' rights generally, general equitable principles (whether considered in a proceeding in equity or at law) and an implied covenant of good faith and fair dealing. SECTION 4.2. Investment Representations. The Purchaser acknowledges that the Firm Shares have not been registered under the Securities Act or under any state securities 10 laws. The Purchaser (a) is acquiring the Firm Shares for investment for its own account, not as a nominee or agent, and not with the view to, or for resale in connection with, any distribution thereof, (b) is an "accredited investor" within the meaning of Regulation D, Rule 501(a), promulgated by the SEC, (c) acknowledges that the Firm Shares must be held indefinitely unless subsequently registered under the Securities Act or unless an exemption from the registration requirements of the Securities Act is available and (d) represents that by reason of its business or financial experience, the Purchaser has the capacity to protect its own interests in connection with the transactions contemplated by this Agreement. The Purchaser has had an opportunity to discuss the Company's business, management and financial affairs with the Company's management. The Purchaser has had an opportunity to ask questions of and receive answers from, officers of the Company. The Purchaser understands that such discussions, as well as any other written information issued by the Company, were intended to describe certain aspects of the Company's business and operations, but were not an exhaustive description. SECTION 4.3. Litigation. There is no Action pending, or to the Purchaser's knowledge, currently threatened against the Purchaser which, if adversely determined, would, individually or in the aggregate, reasonably be expected to have a material adverse effect on the ability of the Purchaser to perform its obligations under this Agreement and to consummate the transactions contemplated hereby. SECTION 4.4. No Broker. The Purchaser has not employed any broker or finder, or incurred any liability for any brokerage or finders' fees or any similar fees or commissions in connection with the transactions contemplated by this Agreement. ARTICLE V COVENANTS OF THE COMPANY SECTION 5.1. Ordinary Course of Business. The Company covenants and agrees that, during the period from the date hereof to the Closing Date and except as contemplated herein, in the Aplitec Acquisition Agreement, the Asset Purchase Agreement or as otherwise agreed to in writing by the Purchaser, the business of the Company shall be conducted only in, and the Company shall not take any action except in the ordinary course of business and in a manner consistent with past practice and in compliance with applicable Laws; and the Company shall use its commercially reasonable efforts to preserve substantially intact the business organization of the Company, to keep available the services of the present officers, employees and consultants of the Company and to preserve the present relationships of the Company with such of the customers, suppliers, licensors, licensees, or distributors with which the Company has significant business relations. By way of amplification and not limitation, the Company shall not, between the date of this Agreement and the Closing Date, except as contemplated herein, in the Aplitec Acquisition Agreement, or in the Asset Purchase Agreement, directly or indirectly do, or propose or commit to do, any of the following: (a) Except to incorporate the provisions of the Amendment, amend its Articles of Incorporation or By-laws or, equivalent organizational documents; (b) Issue, deliver, sell, pledge, dispose of or encumber, or authorize or commit to the issuance, sale, pledge, disposition or encumbrance of any shares of capital 11 stock of any class, or any options, warrants, convertible securities or other rights of any kind to acquire any shares of capital stock, or any other ownership interest (including but not limited to stock appreciation rights or phantom stock), of the Company; (c) Declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock; (d) Reclassify, combine, split, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock; (e) Acquire (by merger, consolidation or acquisition of stock or assets) any corporation, partnership or other business organization or division or line of business, whether in a single transaction or series of related transactions or (B) enter into any proposed transaction or series of related transactions involving a "change of control" of the Company; (f) Transfer, lease, mortgage, or otherwise dispose of or subject to any lien any of its assets; (g) Incur any indebtedness for borrowed money or issue any debt securities or assume, guarantee or endorse, or otherwise as an accommodation become responsible for, the obligations of any person, or make any loans, advances or capital contributions to, or investments in, any other person; (h) Enter into or amend any contract or agreement, other than contracts or amendments issued or entered into in the ordinary course of business with customers or providers of the Company, or any agreement contemplated herein; (i) Increase the compensation or fringe benefits of any of its directors, officers or employees, or grant any severance or termination pay or enter into, or amend, any employment, consulting or severance agreement or arrangement with any present or former director, officer or other employee of the Company, or establish, adopt, enter into or amend or terminate any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, deferred compensation, employment, termination, welfare, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of any directors, officers or employees; (j) Except as may be required as a result of a change in Law or in GAAP, make any change to the accounting practices or principles or reserving or underwriting practices or principles used by it; (k) Settle or compromise any pending or threatened suit, action or claim; (l) Adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization of the Company; 12 (m) Fail to maintain in full force and effect the existing insurance policies covering the Company or its properties, assets and businesses or comparable replacement policies to the extent available for a cost not exceeding 150% of the current cost of such policy; (n) Authorize or make capital expenditures which are, in the aggregate, in excess of $100,000 for the Company; (o) Expand its marketing efforts beyond those countries or states in which its products are offered as of the date of this Agreement, except as agreed in writing with the Purchaser; (p) Make any Tax election or settle or compromise any material federal, state, local or foreign Tax liability, change any annual tax accounting period, change any method of Tax accounting, enter into any closing agreement relating to any Tax, surrender any right to claim a Tax refund, or consent to any extension or waiver of the limitations period applicable to any Tax claim or assessment; or (q) Take, or offer or propose to take, or agree to take in writing or otherwise, any of the actions described in Sections 5.1(a) through 5.1(q) or any action which would result in any of the conditions set forth in Article VII not being satisfied or materially delay the Closing. SECTION 5.2. Access. From the date of this Agreement to the Closing Date (the "Pre-Closing Period"), the Company shall, and shall cause its officers, directors, employees, auditors and other agents to, (a) afford the officers, employees, auditors and other agents of the Purchaser, during normal business hours reasonable access at all reasonable times to its officers, employees, auditors, legal counsel, properties, offices, plants and other facilities and to all books and records, (b) furnish the Purchaser with all financial, operating and other data and information as the Purchaser, through its officers, employees or agents, may from time to time reasonably request and (c) afford the Purchaser the opportunity to discuss the Company's affairs, finances and accounts with the Company's officers on a regular basis. SECTION 5.3. Creation of Subsidiaries for Certain Acquisitions . On the Closing Date, each of New Aplitec and Applied Technologies shall become direct, wholly owned subsidiaries of the Company, and the Company shall cause them to consummate the transactions contemplated in this Agreement for the purpose of effecting the Aplitec Acquisition, in the case of New Aplitec, and the acquisition of the IP rights of Luxco pursuant to the Asset Purchase Agreement, in the case of Applied Technologies. SECTION 5.4. Use of Proceeds. The Company shall use the proceeds from the sale of the Firm Shares to finance the Aplitec Acquisition, to fund working capital and for general corporate purposes; provided that a certain dollar amount to be equal to ZAR 229,814,997 as determined on the Closing Date, of such proceeds shall be used by the Company to (i) invest in New Aplitec A Class Shares (as defined herein) and (ii) advance a credit loan account in New Aplitec in the aggregate principal amount of ZAR 172,361,248, all on the terms 13 and subject to the conditions set forth in the Subscription Agreement, dated as of October 31, 2003, between the Company and New Aplitec (the "Subscription Agreement"). SECTION 5.5. Efforts. Each party hereto agrees to use commercially reasonable efforts to take any and all actions required in order to consummate the transactions contemplated in this Agreement. SECTION 5.6. Notification of Certain Matters. During the Pre-Closing Period, the Company shall give prompt notice to the Purchaser of the occurrence or non-occurrence of any event known to the Company the occurrence or non-occurrence of which would reasonably be expected to cause any representation or warranty contained in Article III to be untrue, or the failure of the Company to comply with or satisfy any covenant or agreement under this Agreement or result in the failure or inability to satisfy any of the conditions precedent set forth in Section 6.1. SECTION 5.7. Regulatory and Other Authorizations; Notices and Consents. Each of the parties hereto shall use their commercially reasonable efforts to give such notices and obtain all authorizations, consents, orders and approvals of all governmental authorities and other third parties that may be or become necessary for its execution and delivery of, and the performance of its obligations pursuant to, this Agreement and will cooperate fully with the other parties hereto in promptly seeking to obtain all such authorizations, consents, orders and approvals. SECTION 5.8. Appointment of Directors. (a) Prior to the Closing, the Company shall take all action necessary to increase the size of the Board up to 10 (ten) directors and to elect three (3) designees of the Purchaser to the Board. (b) At any time, in the Purchaser's reasonable determination and at the request of the Purchaser, (i) the Company shall nominate Brait Nominees (as defined herein) for election or appointment to the Board of Directors as part of the management slate that is included in the proxy statement (or consent solicitation or similar document) of the Company relating to the annual election of directors, and shall provide the same support for the election of such Brait Nominee as it provides to other persons standing for election as directors of the Company as part of the Company's management slate, (ii) the Company shall not permit the removal of any of the Brait Nominees from the Board of Directors without the approval of the Purchaser, and (iii) unless otherwise agreed to by the Purchaser, each committee of the Board of Directors (including any executive committee, audit committee or compensation committee) shall contain a number of Brait Nominees (to the extent available), rounded upward to the nearest whole number, equal to the total number of directors on such committee multiplied by the percentage of the entire Board of Directors who are Brait Nominees. (c) The Company shall reimburse each Brait Nominee that serves as a director for all reasonable costs and expenses (including travel expenses) incurred in connection with such director's attendance at meetings of the Board of Directors or any committee of the Board of Directors upon which such director serves. The Company shall indemnify and provide directors 14 and officers liability insurance for each such director to the maximum extent permitted by law. The Company shall purchase additional policies or endorsements to existing insurance policies as are necessary to provide continuous directors and officers liability insurance coverage including coverage for claims asserted up to six years after the termination of such a policy that arise out of matters occurring prior to such policy terminations, as reasonably requested by the Purchaser. SECTION 5.9. Stockholder Approval. As promptly as practicable following the filing and causing the S-4 to be declared effective by the SEC and mailing or providing to the shareholders of Aplitec a copy of the Proxy Statement/Prospectus, the Company shall take all action necessary to obtain the Stockholder Approval approving the Capital Increase as set forth in the Amendment, including, without limitation, preparing, filing with the SEC and mailing to its stockholders a Proxy Statement/Prospectus or statements with respect thereto, and duly calling, setting a record date for, giving notice of, convening and holding a meeting or meetings of its stockholders for such purpose. The Board shall recommend stockholder approval of (i) the issuance of the Firm Shares and the shares of Convertible Preference Stock and (ii) the Amendment. SECTION 5.10. The Registration Rights Agreement. Prior to the Closing, the Company, Purchaser, Purchaser's nominees who purchase Firm Shares and other investors mutually agreed to between the Company and the Purchaser shall enter into a registration rights agreement, with such terms as may agreed upon among the parties thereto. SECTION 5.11. Convertible Preference Stock. In connection with the Aplitec Acquisition, the Company shall issue 192,967,138 shares of Convertible Preference Stock, as provided for in the Amendment, which shares shall be issued to the Aplitec Holdings Participation Trust, a trust established in the Cayman Islands, for the benefit of the New Aplitec Participation Trust, a trust established in South Africa, and indirectly the shareholders of Aplitec who elect the reinvestment option pursuant to the terms of the Aplitec Acquisition Agreement. ARTICLE VI CONDITIONS TO CLOSING SECTION 6.1. Conditions to the Purchaser's Obligation. (a) Closing. The Purchaser's obligation to purchase the Firm Shares at the Closing is subject to the satisfaction (or waiver by the Purchaser) of the following conditions: (i) Representations and Warranties True; Performance of Obligations. Each of the representations and warranties of the Company contained in this Agreement that is qualified as to materiality or Material Adverse Effect shall be true and correct, and each of the representations and warranties of the Company contained in this Agreement that is not so qualified as to materiality or Material Adverse Effect shall be true and correct in all material respects, in each case as of the Closing Date (except for those representations and warranties which address matters only as of a particular date, which shall be true and correct, or true and correct in all material respects, as the case may be, as of such date). The Company shall have performed in all material respects all 15 agreements, obligations, covenants and conditions herein required to be performed or observed by it on or prior to the Closing Date. (ii) Legal Investment. On such Closing Date, there shall not be in effect any Law or Order directing that the purchase and sale of the Shares, as the case may be, and the other transactions contemplated by this Agreement not be consummated or which has the effect of rendering it unlawful to consummate such transactions. (iii) Proceedings and Litigation. No Action shall have been commenced by any governmental authority against any party hereto seeking to restrain or delay the purchase and sale of the Shares, as the case may be, or the other transactions contemplated by this Agreement. (iv) Approvals. All approvals, consents, permits and waivers of governmental authorities and of third parties in the reasonable judgment of the Purchaser necessary or appropriate for consummation of the transactions contemplated by this Agreement shall have been obtained, and no such approval, consent, permit or waiver of any governmental authority or such other third party shall contain any term or condition that the Purchaser in its reasonable discretion determines to be unduly burdensome. (v) Compliance Certificate; Secretary's Certificate. The Company shall have delivered to the Purchaser a compliance certificate, executed by the Chairman of the Board of Directors and the Chief Executive Officer President of the Company, dated the Closing Date, to the effect that the conditions specified in Section 6.1(a)(i) have been satisfied. The Company shall have delivered to the Purchaser a certificate executed by the Secretary of the Company, dated the Closing Date, certifying as to (i) the resolutions of the Board evidencing approval of the transactions contemplated by and from this Agreement and the authorization of the named officer or officers to execute and deliver this Agreement and (ii) certain of the officers of the Company, their titles and examples of their signatures. (vi) Legal Opinion. The Purchaser shall have received from legal counsel to the Company an opinion addressed to them, dated as of the Closing Date, in the form attached hereto as Exhibit B. (vii) Stockholder Approval. The Stockholder Approval shall have been obtained. (viii) Amendment. The Amendment authorizing the increase of authorized shares of Common Stock and designation of the stock of Convertible Preference Stock shall have been filed with and certified by the State of the Florida Department of State. (ix) Board of Directors. The Company shall have taken all actions required by Section 5.9. (x) Asset Purchase Agreement. The Asset Purchase Agreement shall have been executed and delivered. 16 (xi) Aplitec Acquisition Agreement. The Aplitec Acquisition Agreement shall have been executed and delivered and the suspensive conditions referred to therein shall have been fulfilled substantially satisfactorily to the Purchaser, save for any condition therein that this agreement becomes unconditional. SECTION 6.2. Conditions to Obligations of the Company. (a) Closing. The Company's obligation to issue and sell the Firm Shares at the Closing is subject to the satisfaction (or waiver by the Company), on or prior to the Closing, of the following conditions: (i) Representations and Warranties True. Each of the representations and warranties of the Purchaser contained in this Agreement shall be true and correct in all material respects as of the Closing Date. The Purchaser shall have performed in all material respects all agreements, obligations, covenants and conditions herein required to be performed or observed by it on or prior to the Closing Date. (ii) Legal Investment. On the Closing Date, there shall not be in effect any Law or Order directing that the purchase and sale of the Firm Shares, as the case may be, and the other transactions contemplated by this Agreement not be consummated or which has the effect of rendering it unlawful to consummate such transactions. (iii) Proceedings and Litigation. No Action shall have been commenced by any governmental authority against any party hereto seeking to restrain or delay the purchase and sale of the Firm Shares or the other transactions contemplated by this Agreement. (iv) Approvals. All approvals, consents, permits and waivers of governmental authorities and other third parties in the reasonable judgment of the Purchaser necessary or appropriate for consummation of the transactions contemplated by this Agreement shall have been obtained. (v) Stockholders Approval. The Stockholder Approval shall have been obtained. ARTICLE VII SURVIVAL OF REPRESENTATIONS, WARRANTIES, COVENANTS; INDEMNIFICATION SECTION 7.1. Survival. Notwithstanding any right of any party to fully investigate the affairs of the other party and notwithstanding any knowledge of facts determined or determinable by such party pursuant to such investigation or right of investigation, each party has the right to rely fully upon the representations, warranties, covenants and agreements of each other party in this Agreement. All representations, warranties, covenants and agreements contained in this Agreement shall remain operative and in full force and effect for 24 months after the Closing Date. Notwithstanding the preceding sentence, (i) the representations and warranties contained in Section 3.13 (Taxes) shall terminate on the date that is thirty (30) days 17 after the expiration of the period of all applicable statutes of limitations, (ii) the representations and warranties contained in Section 3.10 (Environmental Matters) shall terminate on the date that is five (5) years after the Closing Date and (iii) the representations and warranties contained in Sections 3.1 (Organization, Good Standing and Qualification), 3.2 (Capital Structure), 3.3 (Authority; No Conflicts; Governmental Approvals) and 3.11 (Brokers or Finders) will survive the Closing indefinitely. (b) No claim for indemnification hereunder for breach of any such representations or warranties may be made after the expiration of the survival period applicable to such claims; provided that any representation or warranty in respect of which indemnity may be sought under this Article VII, and the indemnity with respect thereto, shall survive the time at which it would otherwise terminate pursuant to this Section 7.1 if notice of breach or potential breach thereof giving rise to such right or potential right of indemnity shall have been given to the Person against whom such indemnity may be sought prior to such time. SECTION 7.2. Exclusivity. After the closing to the extent permitted by Law, the indemnities set forth in Section 7.3 shall be the exclusive remedies of the Purchaser against the Company, on the one hand, and of the Company against the Purchaser and its Affiliates, on the other hand for any breach of representation or warranty or breach of any covenant or agreement contained in this Agreement. Notwithstanding the foregoing, nothing herein will eliminate the availability to the parties of any equitable remedies with respect to any dispute that may arise under this Agreement or limit any remedies available under applicable Law for fraud or willful breach. SECTION 7.3. Indemnification. (a) Subject to the other Sections of this Article VII, the Company (the "Purchaser Indemnifier") shall indemnify the Purchaser, its Affiliates and their respective partners, members, stockholders, representatives, officers, directors, employees, agents, successors and permitted assigns (collectively, the "Purchaser Indemnitee) in respect of, and save and hold each of them harmless from and against, any and all Losses (as defined herein) suffered, incurred or sustained by any of them or to which any of them becomes subject, resulting from, arising out of or relating to (i) any breach of a representation or warranty made by the Company without regard to any materiality qualifiers (including Material Adverse Effect) and, in the case of Section 4.2(j) (Environmental Matters), qualifications of Knowledge or (ii) any breach or non-fulfillment of any covenant or agreement or other provision by the Company contained in this Agreement. (b) Subject to the other Sections of this Article VII, the Purchaser (the "Company Indemnifier", and together with the Purchaser Indemnifier, the "Indemnifiers") shall indemnify the Company, its officers, directors, employees, agents, successors and permitted assigns (collectively, the "Company Indemnitee", and together with the Purchaser Indemnitee, the "Indemnified Parties") in respect of, and save and hold each of them harmless from and against, any and all Losses suffered, incurred or sustained by any of them or to which any of them becomes subject, resulting from, arising out of or relating to (i) any breach of a representation or warranty made by the Company without regard to any materiality qualifiers (including Material 18 Adverse Effect) and (ii) any breach or non-fulfillment of any covenant or agreement or other provision by the Purchaser contained in this Agreement. SECTION 7.4. Method of Asserting Claims. All claims for indemnification by any Indemnified Party under Section 7.3 will be asserted and resolved as follows: (a) In the event any claim or demand in respect of which a Indemnified Party might seek indemnity under Section 7.3 is asserted against or sought to be collected from a Indemnifier by a Person other than the Purchaser or any Affiliate of the Purchaser (a "Third Party Claim"), the Indemnified Party shall deliver a Claim Notice with reasonable promptness to the Indemnifier; provided that the failure to so notify the Indemnifier shall not relieve the Indemnifier of its obligations hereunder except to the extent (and only to the extent) that such failure shall have caused the damages for which the Indemnifier is obligated to be greater than such damages would have been had the Indemnified Party given the Indemnifier prompt notice hereunder. The Indemnifier will notify the Indemnified Party as soon as practicable within the Dispute Period (as defined herein) whether the Indemnifier disputes its liability to the Indemnified Party under this Section 7.3 or whether the Indemnifier desires, at its sole cost and expense, to defend the Indemnified Party against such Third Party Claim. (i) If the Indemnifier notifies the Indemnified Party within the Dispute Period that the Indemnifier desires to defend the Indemnified Party with respect to the Third Party Claim pursuant to this Section 7.4(a), then the Indemnifier will have the right to defend with counsel selected by the Indemnifier who shall be reasonably acceptable to the Indemnified Party, at the sole cost and expense of the Indemnifier, such Third Party Claim by all appropriate proceedings, which proceedings will be vigorously and diligently prosecuted by the Indemnifier to a final conclusion; provided that the Indemnifier shall obtain the prior written consent of the Indemnified Party (which consent shall not be unreasonably withheld, delayed or conditioned) before entering into any settlement of a claim or ceasing to defend such claim. If the Indemnifier assumes defense of a Third Party Claim, then such Indemnifier will have full control of such defense and proceedings, including (except as provided in the immediately preceding sentence) any settlement thereof; provided, however, that the Indemnified Party may, at the sole cost and expense of the Indemnified Party, at any time prior to the Indemnifier's delivery of the notice referred to in the first sentence of this clause (i), file any motion, answer or other pleadings or take any other action that the Indemnified Party reasonably believes to be necessary or appropriate to protect its interests and not prejudicial to the Indemnifier; and provided, further, that the Indemnified Party may participate, at its own expense, in the defense of such Third Party Claim; and provided further, that if requested by the Indemnifier, the Indemnified Party will, at the sole cost and expense of the Indemnifier, cooperate with the Indemnifier and its counsel in contesting any Third Party Claim that the Indemnifier elects to contest, or, if appropriate and related to the Third Party Claim in question, in making any counterclaim against the Person asserting the Third Party Claim, or any cross-complaint against any Person (other than the Indemnified Party or any of its Affiliates). The Indemnified Party will be entitled to participate in any such defense with separate counsel at the expense of the Indemnifier if (i) so requested by 19 the Indemnifier to participate, (ii) in the reasonable opinion of counsel to the Indemnified Party, a conflict or potential conflict exists between the Indemnified Party and the Indemnifying that would make such separate representation advisable or (iii) the Indemnified Party has defenses available to it that are not available to the Indemnifier. (ii) If an Indemnifier fails to notify the Indemnified Party within the Dispute Period that the Indemnifier desires to defend the Third Party Claim pursuant to this Section 7.4(a), or if an Indemnifier gives such notice but fails to prosecute vigorously and diligently or settle the Third Party Claim, or if the Indemnifier fails to give any notice whatsoever within the Dispute Period, then the Indemnified Party will have the right to defend, at the sole cost and expense of the Indemnifier, the Third Party Claim by all appropriate proceedings, which proceedings will be vigorously and diligently prosecuted by the Indemnified Party to a final conclusion or will be settled at the discretion of the Indemnified Party (with the consent of the Indemnifier, which consent will not be unreasonably withheld delayed or conditioned). If an Indemnified Party defends any Third Party Claim, then the Indemnifier shall be required to reimburse the Indemnified Party for the reasonable costs and expenses of defending such Third Party Claim within ten (10) Business Days after the date of receipt of any bill. The Indemnified Party will have full control of such defense and proceedings, including (except as provided in the immediately preceding sentence) any settlement thereof; provided, however, that if requested by the Indemnified Party, the Indemnifier will, at the sole cost and expense of the Indemnifier, cooperate with the Indemnified Party and its counsel in contesting any Third Party Claim which the Indemnified Party is contesting, or, if appropriate and related to the Third Party Claim in question, in making any counterclaim against the Person asserting the Third Party Claim, or any cross-complaint against any Person (other than the Company Indemnifier or any of its Affiliates). The Indemnifier may participate in, but not control, any defense or settlement controlled by the Indemnified Party pursuant to this clause (ii), and the Indemnifier will bear its own costs and expenses with respect to such participation. (b) In the event an Indemnified Party should have a claim under Section 7.3 against any Indemnifier that does not involve a Third Party Claim, the Indemnified Party shall deliver an Indemnity Notice with reasonable promptness to the Indemnifier. The Indemnifier shall notify the Indemnified Party within thirty (30) days following its receipt of such notice if the Indemnifier disputes its liability to the Indemnified Party under this Article 7. If the Indemnifier does not so notify the Indemnified Party, the claim specified by the Indemnified Party in such notice shall be conclusively deemed to be a liability of the Indemnifier under this Article 8, and the Indemnifier shall pay the amount of such liability to the Indemnified Party on demand, or, in the case of any notice in which the amount of the claim (or any portion of the claim) is estimated, on such later date when the amount of such claim (or such portion of the claim) becomes finally determined. ARTICLE VIII CERTAIN AGREEMENTS SECTION 8.1. Financial Statements and Other Reports. The Company shall deliver, or cause to be delivered to the Purchaser: 20 (a) Monthly Financials. As soon as practicable and in any event within 30 days after the end of each calendar month of the Company, copies of the consolidated and consolidating income statement, operating cash flow statement, balance sheet and performance to budget analysis for the Company and its consolidated Subsidiaries for and as of the end of such month. (b) Quarterly Financials. As soon as practicable and in any event within 45 days after the end of each fiscal quarter of the Company, a consolidated balance sheet of the Company and its consolidated Subsidiaries as at the end of such period, and the related unaudited consolidated statements of income and of cash flows, as contained in the Form 10-Q for such fiscal quarter provided by the Company to the SEC, and if such Form 10-Q is no longer required to be so provided by the Company, then the Company shall provide the Purchaser with comparable financial statements, certified by the chief financial officer of the Company that they fairly present the financial condition and results of operations of the Company and its consolidated Subsidiaries, as appropriate, as at the end of such periods and for such periods, subject to changes resulting from audit and normal year-end adjustments. (c) Year-End Financials. As soon as practicable and in any event within 90 days after the end of each fiscal year of the Company, the audited consolidated balance sheet of the Company and its consolidated Subsidiaries, as at the end of such year, and the related consolidated statements of income, shareholders' equity and cash flows of the Company and its consolidated Subsidiaries for such fiscal year, (1) accompanied by a report thereon of independent certified public accountants of recognized international standing selected by the Company and reasonably satisfactory to the Purchaser, which report shall state that the examination by such accountants in connection with such financial statements has been made in accordance with generally accepted auditing standards without any limitations being imposed on the scope of such examination and (2) certified by the chief financial officer of the Company that they fairly present the financial condition and results of operations of the Company and its consolidated Subsidiaries, as at the dates and for the periods indicated, as appropriate. (d) Reconciliation Statement. If, as a result of any change in accounting principles and policies from those used in the preparation of the financial statements, the financial statements of the Company and its Subsidiaries delivered pursuant to subsections (b), (c) or (e) of this Section will differ in any material respect from the financial statements that would have been delivered pursuant to such subsection had no such change in accounting principles and policies been made, then, together with the first delivery of financial statements pursuant to subsections (b), (c) or (e) following such change, financial statements of the Company and its consolidated Subsidiaries prepared on a pro forma basis, for (1) the current year to the effective date of such change and (2) the one full fiscal year immediately preceding the fiscal year in which such change is made, as if such change had been in effect during such period. (e) Accountants' Reports. Promptly upon receipt thereof, copies of all significant reports submitted to the Company by independent public accountants in connection with each annual, interim or special audit of the financial statements of the Company made by such accountants, including, without limitation, the comment letter submitted by such accountants to management in connection with their annual audit. 21 (f) Reports and Filings. Within five days after the same are sent, copies of all financial statements and reports which the Company sends to its stockholders, and within five days after the same are filed, copies of all financial statements and reports which the Company may make to, or file with, the SEC. (g) Events of Default etc. Promptly upon, but in any event no later than two Business Days after, any executive officer of the Company obtaining knowledge (1) of any condition or event that constitutes a violation or default, or becoming aware that any lender has given any notice or taken any other action with respect to a claimed violation or default under the instruments governing its outstanding debt, (2) that any Person has given any notice to the Company or any of its Subsidiaries or taken any other action with respect to a claimed default or event or condition that would be required to be disclosed in a current report filed by the Company with the SEC on Form 8-K (Items 1, 2, 4 and 5 of such Form as in effect on the date hereof) or (3) of any condition or event which has had or could reasonably be expected to have a Material Adverse Effect, an officer's certificate specifying the nature and period of existence of such condition or event, or specifying the notice given or action taken by such holder or Person and the nature of such claimed violation, default, event or condition, and what action the Company has taken, is taking and proposes to take with respect thereto. (h) Litigation. promptly upon any executive officer of the Company obtaining knowledge of (1) the institution of any action, suit, proceeding, governmental investigation or arbitration against or affecting the Company or any Subsidiary not previously disclosed by the Company to the Purchaser or (2) any material adverse development in any such action, suit, proceeding, governmental investigation or arbitration that, in any case involves claims in excess of $500,000 in the aggregate or would reasonably be expected to cause a Material Adverse Effect, the Company shall promptly give notice thereof to the Purchaser and provide such other information as may be reasonably available to them to enable the Purchaser and its counsel to evaluate such matters; (i) Financial Plans. As soon as practicable and in any event no later than 30 days before the end of any fiscal year of the Company, a budget and financial forecast for the Company and its Subsidiaries including, (1) a forecasted operating cash flows statement of the Company and its Subsidiaries for the next succeeding fiscal year, (2) forecasted operating cash flows statement of the Company and its Subsidiaries for each fiscal quarter of the next succeeding fiscal year and (3) such other information and projections as the Purchaser may reasonably request, in each case, in a format satisfactory to the Purchaser. (j) Other Information. With reasonable promptness, such other information and data with respect to the Company or any of its Subsidiaries as from time to time may be reasonably requested by the Purchaser. ARTICLE IX MISCELLANEOUS SECTION 9.1. Other Definitions. The following terms as used in this Agreement shall have the following meanings: 22 "Affiliate" means, with respect to any Person, any other Person that directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with, such specified Person, for so long as such Person remains so associated to the specified Person. "Aplitec" means Net 1 Applied Technology Holdings Limited, a public company incorporated in South Africa and listed on the Johannesburg Stock Exchange. "Applied Technologies" means Net 1 Applied Technologies S.a.r.l. or such other name as determined by the Company, a Luxembourg company to be incorporated or formed as a wholly owned subsidiary of the Company. "Asset Purchase Agreement" means the Asset Purchase Agreement between Luxco and the Company whereby the Company will purchase on behalf of Applied Technologies certain intellectual property from Luxco. "Benefit Plans" means, with respect to any Person, each employee benefit plan, program, arrangement and contract (including, without limitation, any "employee benefit plan," as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended ("ERISA") and any bonus, deferred compensation, stock bonus, stock purchase, restricted stock, stock option, employment, termination, stay agreement or bonus, change in control and severance plan, program, arrangement and contract) in effect on the date of this Agreement or disclosed on the Disclosure Schedule to which such Person or its Subsidiary is a party, which is maintained or contributed to by such Person, or with respect to which such Person could incur material liability under Section 4069, 4201 or 4212(c) of ERISA. "Board of Directors" means the Board of Directors of any specified Person and any committees thereof. "Brait Nominee" means any individual nominated by the Purchaser or any purchaser nominee for election to the Board of Directors. "Claim Notice" means written notification pursuant to Section 7.4 of a Third Party Claim as to which indemnity under Section 7.3 is sought by an Indemnified Party, enclosing a copy of all papers served, if any, and specifying the nature of and basis for such Third Party Claim and for the Indemnified Party's claim against the Indemnifier under Section 7.4, together with the amount or, if not then reasonably ascertainable, the estimated amount, determined in good faith, of such Third Party Claim. "Code" means the Internal Revenue Code of 1986, as amended. "Control" (including the terms "controlled by" and "under common control with"), with respect to the relationship between or among two or more Persons, means the possession, directly or indirectly, of the power to direct or cause the direction of the affairs or management of a Person, whether through the ownership of voting securities, as trustee or executor, by contract or otherwise. 23 "Dispute Period" means the period ending thirty (30) calendar days following receipt by the Indemnifier of either a Claim Notice or an Indemnity Notice. "Environmental Laws" means all applicable Laws and Orders relating in any manner to contamination, pollution or protection of human health, natural resources or the environment. "Environmental Liabilities" with respect to any person means any and all liabilities of or relating to such person or any of its Subsidiaries (including any entity which is, in whole or in part, a predecessor of such person or any of such Subsidiaries), whether vested or unvested, contingent or fixed, actual or potential, known or unknown, which (i) arise under applicable Environmental Laws or with respect to Hazardous Materials, and (ii) relate to actions occurring or conditions existing, on or prior to the Closing Date. "Environmental Permits" means all Permits and other governmental authorizations required under Environmental Laws for the Company to conduct its operations. "Exchange Act" means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder. "GAAP" means generally accepted accounting principles, consistently applied. "Governmental Entity" means any government, quasi-governmental authority, court, tribunal, arbitrator, authority, regulatory body, agency, commission, official or other instrumentality and any supranational organization of sovereign states exercising such function for such sovereign states of the United States or any foreign country or any domestic or foreign state, county, city or other political subdivision exercising executive, legislative or judicial authority. "Group" shall have the meaning assigned to it in Section 13(d)(3) of the Exchange Act. "Hazardous Materials" means all hazardous, infectious, dangerous or toxic substances, including without limitation, petroleum (including without limitation crude oil or any fraction thereof), asbestos and asbestos-containing materials, polychlorinated biphenyls, and any other material that is regulated pursuant to any Environmental Laws or that could result in any Loss under any Environmental Laws. "Intellectual Property" means all intellectual property, including without limitation all (i) (a) the patents, inventions, discoveries, processes, designs, techniques, developments, technology and know-how, (b) copyrights and works of authorship in any media, including computer programs, hardware, firmware, software, applications, files, specifications, Internet site content, databases and compilations, documentation and related items textual works, graphics, advertising, marketing and promotional materials, photographs, drawings, articles, textual works, the protected features of any utilitarian objects or pictorial or graphic works; (c) trademarks, service marks, trade names, brand names, corporate names, domain names, logos, trade dress and other source indicators, and the goodwill of any business symbolized thereby; (d) trade secrets, confidential, proprietary or non-public information, documents, data, analyses, 24 research and lists including but not limited to all design documents, specifications, source code and all current and potential customer lists; (ii) all registrations, applications, recordings and the right to obtain renewals, extensions, substitutions, continuations, continuations-in-part, divisions, re-issues, re-examinations or similar legal protections related thereto; (iii) all material licenses, consents, royalty and other agreements concerning all the foregoing; and (iv) all materials or tangible media embodying or incorporating the foregoing, and any renewals or extensions thereof; and any similar intellectual property or proprietary rights. "Known" or "Knowledge" means, with respect to the Company or the Purchaser, the actual conscious knowledge of the Company or the Purchaser, as the case may be, or the knowledge that would be expected to have been obtained after reasonable inquiry, of any director or officer of the Company or the Purchaser, as the case may be. "Laws" means all laws, common law, statutes, rules, regulations, ordinances, constitutions, treaties, compacts, directives, codes, orders, Permits, authorizations, variances, rules, judicial decisions, governmental agreements and other pronouncements having the effect of law of the United States, any foreign country or any domestic or foreign state, county, city or other political subdivision or of any Governmental or Regulatory Authority. "Liens" means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), other charge or security interest; or any preference, priority or other agreement or preferential arrangement of any kind or nature whatsoever (including, without limitation, any conditional sale or other title retention agreement, any capital lease having substantially the same economic effect as any of the foregoing). "Loss" means any and all liabilities, damages, fines, penalties, deficiencies, Taxes, losses and expenses (including without limitation interest, court costs, reasonable fees of attorneys, accountants and other experts or other reasonable expenses of litigation or other proceedings or any claim, default or assessment). "Luxco" means Net 1 Holdings S.a.r.l., a Luxembourg company. "Material Adverse Effect" means, with respect to the Purchaser or the Company, any effect that is material and adverse to the business, assets or financial condition of the Purchaser, or the Company, taken as a whole, respectively. "New Aplitec" means Newshelf 713 (Proprietary) Limited to be renamed "Net1 Applied Technologies South Africa (Proprietary) Limited" or a similar name, a private company incorporated in South Africa and whose ordinary shares will be owned 100% by the Company pursuant to terms of the Subscription Agreement. "New Aplitec A Class Shares" means the A class ordinary shares, par value ZAR 0.001 per share, of New Aplitec. "Order" means any writ, judgment, decree, injunction, award, settlement or stipulation, decision, determination, ruling, subpoena or verdict or similar order entered, issued, made or rendered by any Governmental Entity (in each such case whether preliminary or final). 25 "Permit" means all licenses, permits, orders, consents, approvals, registrations, authorizations, qualifications and filings with and under all U.S. federal, state or local or other non-U.S. laws and Governmental Entities. "Permitted Liens" means (i) any liens for taxes not yet due or which are being contested in good faith by appropriate proceedings, (ii) carriers', warehousemen's, mechanics', materialmen's, repairmen's or other similar liens, (iii) pledges or deposits in connection with workers' compensation, unemployment insurance, and other social security legislation and (iv) easements, rights-of-way, restrictions and other similar encumbrances incurred in the ordinary course of business which, in the aggregate, are not substantial in amount and which do not in any case materially detract from the value of the property subject thereto. "Person" means any individual, corporation, limited liability company, limited or general partnership, joint venture, association, joint-stock company, trust, unincorporated organization, government or any agency or political subdivisions thereof or any Group comprised of two or more of the foregoing. "SEC" means the U.S. Securities and Exchange Commission. "Securities Act" means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. "Subsidiary" when used with respect to any party means any corporation or other organization, whether incorporated or unincorporated, (i) of which such party or any other Subsidiary of such party is a general partner (excluding partnerships, the general partnership interests of which held by such party or any Subsidiary of such party do not have a majority of the voting interests in such partnership) or (ii) at least a majority of the securities or other interests of which having by their terms ordinary voting power to elect a majority of the Board of Directors or others performing similar functions with respect to such corporation or other organization is directly or indirectly owned or controlled by such party or by any one or more of its Subsidiaries, or by such party and one or more of its Subsidiaries. "Tax" (including, with correlative meaning, the terms "Taxes" and "Taxable") means all federal, state, local and foreign income, profits, premium, franchise, gross receipts, environmental, customs duty, capital stock, severance, stamp, payroll, sales, employment, unemployment, disability, use, property, withholding, excise, production, value added, occupancy and other taxes, duties or governmental levies of any nature whatsoever, together with all interest, penalties and additions imposed with respect to such amounts or filing requirements and any interest in respect of such penalties and additions. "Tax Return" means all returns and reports (including elections, declarations, disclosures, schedules, estimates, information returns, claim for refund, and amended returns) relating to Taxes. "Technology Agreements" means the collective reference to (i) the Patent and Technology Agreement dated May 3, 2000 between Luxco and the Company and (ii) the Distribution Agreement, dated as of July 1, 2002, between the Company and Net 1 Investment Holdings (Pty) Limited. 26 "ZAR" means the South African Rand. SECTION 9.2. Governing Law; Jurisdiction; Waiver of Jury Trial. This Agreement shall be governed in all respects by the laws of the State of New York. No suit, action or proceeding with respect to this Agreement may be brought in any court or before any similar authority other than in a court of competent jurisdiction in the State of New York, as the Purchaser may elect in its sole discretion, and the Company hereby submits to the exclusive jurisdiction of such courts for the purpose of such suit, proceeding or judgment. The Company hereby irrevocably waives any right which it may have had to bring such an action in any other court, domestic or foreign, or before any similar domestic or foreign authority. Each of the parties hereto hereby irrevocably and unconditionally waives trial by jury in any legal action or proceeding in relation to this Agreement and for any counterclaim therein. SECTION 9.3. Successors and Assigns; Assignment. Except as otherwise expressly provided herein, the provisions hereof shall inure to the benefit of, and be binding upon, the successors, permitted assigns, heirs, executors and administrators of the parties hereto and shall inure to the benefit of and be enforceable by each Person who shall be a holder of the Shares from time to time. This Agreement may not be assigned without the prior written consent of the other party, except that the Purchaser may assign its rights and obligations hereunder to any Affiliate or Affiliates or nominee purchasers of any of the Firm Shares and each nominee purchaser shall benefit from all the representations, warranties and covenants of the Company contained herein to the same degree as the Purchaser. SECTION 9.4. No Reliance. Except as provided in Section 9.3, no third party is entitled to rely on any of the representations, warranties and agreements contained in this Agreement, and the Company and the Purchaser assume no liability to any third party because of any reliance on the representations, warranties and agreements of the Company and the Purchaser contained in this Agreement. SECTION 9.5. Entire Agreement; Supersedes Prior Agreement. This Agreement and the Exhibits and Schedules hereto and the other documents delivered pursuant hereto constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and no party shall be liable or bound to any other in any manner by any representations, warranties, covenants and agreements except as specifically set forth herein and therein. SECTION 9.6. Severability. In case any provision of this Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. SECTION 9.7. Amendment and Waiver. This Agreement may be amended or modified, and the rights of the Company or the Purchaser hereunder may only be waived, upon the written consent of the Company and the Purchaser. SECTION 9.8. Delays or Omissions. It is agreed that no delay or omission to exercise any right, power or remedy accruing to any party, upon any breach, default or noncompliance by another party under this Agreement, shall impair any such right, power or 27 remedy, nor shall it be construed to be a waiver of any such breach, default or noncompliance, or any acquiescence therein, or of or in any similar breach, default or noncompliance thereafter occurring. It is further agreed that any waiver, permit, consent or approval of any kind or character on the Purchaser's part of any breach, default or noncompliance under this Agreement or any waiver on such party's part of any provisions or conditions of this Agreement, must be in writing and shall be effective only to the extent specifically set forth in such writing. All remedies under this Agreement, by Law, or otherwise afforded to any party, shall be cumulative and not alternative. SECTION 9.9. Notices. All notices required or permitted hereunder shall be in writing and shall be deemed effectively given: (a) upon personal delivery to the party to be notified; (b) when sent by confirmed telex or facsimile if sent during normal business hours of the recipient, if not, then on the next business day; (c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid; or (d) one (1) business day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of receipt. All communications shall be sent to the addresses set forth below: If to the Company: Net 1 UEPS Technologies, Inc. 325-744 West Hastings Street Vancouver, British Columbia, Canada V6C 1A5 Attn: Chief Executive Officer with copies to: Schneider Weinberger LLP 2499 Glades Road, Suite 108 Boca Raton, FL 33431 Telephone: (561) 362-9595 Fax: (561) 362-9612 Attn: Jim Schneider, Esq. If to the Purchaser: 19 Baarestrasse Zug Switzerland Telephone: Fax: 0941 41 710 3377 c/o Brait Capital Partners Limited 19 Baarestrasse Zug Switzerland Telephone: 28 Fax: 0941 41 710 3377 with copies to: Simpson Thacher & Bartlett LLP 425 Lexington Avenue New York, NY 10017 Telephone: (212) 455-2000 Fax: (212) 455-2502 Attn: John W. Carr, Esq. SECTION 9.10. Expenses. The Company shall pay all costs and expenses that it incurs with respect to the negotiation, execution, delivery and performance of this Agreement. The Company shall pay all fees and expenses as set forth in the Letter of Appointment dated April 25, 2003 from BAS to the Company. The Company shall, at or after the Closing, reimburse all reasonable expenses of the Purchaser incurred in connection with the transactions contemplated by this Agreement, including the payment of the reasonable fees, disbursements and expenses payable to consultants, accountants and counsel to the Purchaser. The Purchaser may, at its option, net any such amounts against amounts payable to the Company at the Closing. SECTION 9.11. Titles and Subtitles. The titles of the sections and subsections of this Agreement are for convenience of reference only and are not to be considered in construing this Agreement. SECTION 9.12. Termination. This Agreement may be terminated by (i) mutual agreement of the parties hereto or (ii) by the Purchaser or the Company in the event the Closing has not occurred by May 31, 2004; provided that this termination right may not be exercised by a party whose nonperformance has delayed the Closing. Upon termination of this Agreement pursuant to this Section, this Agreement shall be void and of no further force and effect and no party shall have any liability to any other party under this Agreement, except that nothing herein shall relieve any party from any liability for the breach of any of the representations, warranties, covenants and agreements set forth in this Agreement and except as contemplated by Section 9.10. SECTION 9.13. Counterparts; Execution by Facsimile Signature. This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument. This Agreement may be executed by facsimile signature(s). 29 IN WITNESS WHEREOF, the parties hereto have executed this Common Stock Purchase Agreement as of the date set forth in the first paragraph hereof. NET 1 UEPS TECHNOLOGIES, INC. By: /s/ Claude Guerard ----------------------------------------- Name: Claude Guerard Title: Chief Executive Officer SAPEF III INTERNATIONAL G.P. LIMITED By: /s/ Hans Schibli ----------------------------------------- Name: Hans Schibli Title: Director Schedule 3.17 - Disclosure Schedule Patent and Technology Agreement between Luxco and the Company dated May 3, 2000 Distribution Agreement between the Company and Net 1 Investment Holdings (Pty) Limited dated July 1, 2002 EXHIBIT A Articles of Amendment to the Articles of Incorporation of the Company EXHIBIT B FORM OF OPINION OF COUNSEL TO THE COMPANY The Purchaser shall have received the favorable opinion, dated as of the Closing Date, of Schneider Weinberger LLP, counsel to the Company, in form and substance satisfactory to the Purchaser, and addressed to the Purchaser and to the effect that: 1. The Company has been duly incorporated and is validly existing and in good standing as a corporation under the laws of the State of Florida and has full corporate power and authority to conduct its business as described in the Proxy Statement/Prospectus. 2. The Company has full corporate power and authority to enter into and perform its obligations under the Stock Purchase Agreement and the transactions contemplated thereby and to issue the Common Shares. The execution and delivery of the Stock Purchase Agreement by the Company and the consummation by it of the transactions contemplated thereby have been duly authorized by all necessary corporate action, and no further consent or authorization of the Company or its Board of Directors or stockholders is required. The Stock Purchase Agreement has been duly executed and delivered, and constitutes a valid and binding obligation of the Company enforceable against the Company in accordance with its respective terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, or similar laws relating to, or affecting generally the enforcement of, creditors' rights and remedies or by other equitable principles of general application. 3. The Common Shares have been duly authorized and, upon payment and delivery in accordance with the Stock Purchase Agreement, will be, validly issued, fully paid and nonassessable. 4. The statements made in the Proxy Statement/Prospectus under the caption "Description of Capital Stock", insofar as they purport to constitute summaries of the terms of the Common Stock and Preferred Stock, constitute accurate summaries of the terms of such Common Stock and Preferred Stock in all material respects. 5. No consent, approval, authorization, order, registration or qualification of or with any federal or Florida governmental agency or body, to such Counsel's knowledge, any federal or Florida court or any Florida court acting pursuant to the Florida Business Corporation Act is required for the issue and sale of the shares of Common Stock by the Company or the issuance of the shares of Convertible Preference Stock by the Company, except for the registration under the Securities Act of such shares, and such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the purchase shares of Common Stock by the Purchaser. 6. There are no preemptive rights under federal or Florida law to subscribe for or purchase shares of the Common Stock. There are no preemptive or other rights to subscribe for or purchase, nor any restriction upon the voting or transfer of, any shares of the Common Stock pursuant to the Company's Articles of Incorporation or By-laws or any agreement or other instrument filed on the annexed schedule furnished to us by the Company. 7. To such Counsel's knowledge, there are no statutes or pending or threatened legal or governmental proceedings against the Company required to be described in the Proxy Statement/Prospectus which are not described as required, or any contracts or documents to which the Company is a party of a character required to be described in the Proxy Statement/Prospectus or to be filed as exhibits to the Proxy Statement/Prospectus or incorporated by reference therein that are not described and filed or incorporated by reference as required. 8. The authorized capital stock of the Company consists of 500,000,000 shares of Common Stock, par value $0.001 per share, and 300,000,000 shares of Preferred Stock, par value of $0.001 per share. 9. The Company is not an "investment company" within the meaning of and subject to regulation under the Investment Company Act of 1940, as amended. EX-99.B 3 y98296exv99wb.txt ASSIGNMENT AGREEMENT Exhibit B ASSIGNMENT AND ACCEPTANCE Reference is made to the Common Stock Purchase Agreement, dated as of January 30, 2004 (the "Agreement"), between Net 1 UEPS Technologies, Inc., a Florida corporation (the "Seller"), and SAPEF III International G.P. Limited, a British Virgin Islands company, or its nominees (the "Assignor"). Unless otherwise defined herein, terms defined in the Agreement and used herein shall have the meanings given to them in the Agreement. For good and valid consideration, the receipt and sufficiency of which is hereby acknowledged, the Assignor and each of South African Private Equity Fund III, L.P. ("SAPEF III Fund"), Rose Nominees Limited (A/C 20423) ("Rose"), Brenthurst Private Equity II Limited ("BPE2") and Brenthurst Private Equity South Africa I Limited ("BPESA") (each, individually, an "Assignee", and collectively, the "Assignees"), agree as follows: 1. The Assignor hereby assigns to each Assignee, and each Assignee hereby assumes from the Assignor, as of June 7, 2004 (the "Effective Date"), the interest in and to the Assignor's rights and obligations under the Agreement, to purchase that number of Firm Shares set forth opposite each Assignee's name on Schedule A attached hereto. 2. From and after the Effective Date, (a) each Assignee shall be a party to the Agreement and, to the extent provided in this Assignment and Acceptance, have the rights and obligations under the Agreement (including the Assignor's rights and obligations with respect of any certificates, agreements or other documents delivered at Closing) and shall be bound by the provisions thereof; (b) each Assignee shall benefit from all of the representations, warranties and covenants of the Seller contained in the Agreement to the same degree as the Assignor and (c) each Assignee shall do all other acts and things necessary, advisable or convenient for the purposes of giving effect to all or any of the preceding mentioned agreements, documents or transactions, provided, however, that nothing in this Assignment and Acceptance shall cause any Assignee to be liable to the Seller in respect of any Firm Shares except as specified in Section 1 above or in respect of any breach of any representation or warranty given in or under the Agreement which did not relate to such Assignee. 3. This Assignment and Acceptance shall be governed by and construed in accordance with the laws of the State of New York. 2 IN WITNESS WHEREOF, the parties hereto have caused this Assignment and Acceptance to be executed as of the Effective Date by their respective duly authorized officers. SAPEF III International G.P. Limited, as South African Private Equity Assignor Fund III, L.P., as Assignee By: SAPEF III International G.P. Limited, its General Partner By: ______________________________ By: _______________________________ Name: Name: Title: Title: Rose Nominees Limited (A/C 20423), as Assignee By: _______________________________ Name: Title: Brenthurst Private Equity II Limited, as Assignee By: _______________________________ Name: Title: Brenthurst Private Equity South Africa I Limited, as Assignee By: _______________________________ Name: Title: 3 Pursuant to Section 9.3 of the Agreement, the Seller hereby consents to this Assignment and Acceptance. Net 1 UEPS Technologies, Inc. By: _______________________________ Name: Title: SCHEDULE A
Name Number of Firm Shares - ---- --------------------- South African Private Equity Fund III, L.P. 86,661,428 Rose Nominees Limited (A/C 20423) 2,000,000 Brenthurst Private Equity II Limited 11,000,000 Brenthurst Private Equity South Africa I Limited 6,000,000
EX-99.C 4 y98296exv99wc.txt UNDERWRITING AGREEMENT Exhibit D UNDERWRITING AGREEMENT between SOUTH AFRICAN PRIVATE EQUITY TRUST III (Herein represented by BRAIT CAPITAL PARTNERS TRUSTEES (PTY) LIMITED) and SOUTH AFRICAN PRIVATE EQUITY FUND III L.P. (Herein represented by SAPE INTERNATIONAL GP LTD) and NEWSHELF 713 (PTY) LIMITED TABLE OF CONTENTS
PAGE 1. PARTIES 1 2. INTRODUCTION 1 3. UNDERWRITING 2 4. CONDITION 2 5. BREACH 2 6. DOMICILIUM AND NOTICES 3 7. GENERAL 4 8. COSTS 6
UNDERWRITING AGREEMENT 1. PARTIES 1.1 SOUTH AFRICAN PRIVATE EQUITY TRUST III (herein represented by BRAIT CAPITAL PARTNERS TRUSTEES (PTY) LIMITED) ("SAPET") 1.2 SOUTH AFRICAN PRIVATE EQUITY III L.P. (herein represented by SAPE INTERNATIONAL 3P LIMITED) ("SAPEF") 1.3 NEWSHELF 713 (PTY) LIMITED ("Newco") 2. INTRODUCTION 2.1 Newco has resolved to make an offer to Net 1 Applied Technology Holdings Limited ("Aplitec") to acquire the whole of its business undertaking in terms of Section 228 of the Companies Act, 1973, as amended ("the Disposal") in terms of an offer submitted to the Board of Directors of Aplitec dated 28 October 2003 ("the Offer Agreement") and the Disposal Agreement signed on 31 October 2003 ("the Disposal Agreement") 2.2 The purchase price payable under the Disposal will be discharged at the election of the shareholders of Aplitec as to 100% in cash or 40% in cash and 60% as a reinvestment option in Newco ("the Reinvestment Option"). 2.3 SAPET and SAPEF have agreed to underwrite the Reinvestment Option on the terms and conditions set out herein. 2.4 The parties wish to record their agreement in writing. 3. UNDERWRITING 3.1 SAPET and SAPEF hereby agrees to underwrite the Reinvestment Option offered by Newco to the shareholders of Aplitec in terms of the Disposal in the maximum sum of R436 972 343,10 ("the Maximum Sum") and undertakes to take up all of the rights of the Reinvestment Option not taken up by the shareholders of Aplitec in terms of the Reinvestment Option in the Maximum Sum. 3.2 In calculating the Maximum Sum, the irrevocable undertakings to vote in favour of the Disposal and to take up their respective rights under the Reinvestment Option by Nedbank Limited and Serge Belamont have been taken into account. 3.3 SAPET and SAPEF shall, on the day that the shareholders of Aplitec who elect to take up their pro rata share of the Reinvestment Option pay to Newco via the same investment vehicle as the reinvesting shareholders of Aplitec, so much of the amount of the Reinvestment Option not taken up by the shareholders of Aplitec as a capital contribution and loans in the same ratio as the reinvesting shareholders of Aplitec. 4. CONDITION The whole of this agreement is conditional upon all of the conditions contained in the Disposal Agreement either being waived or being fulfilled on due date for fulfillment thereof as set out in the Disposal Agreement. 5. BREACH Save as otherwise provided in this agreement, should a party the ("defaulting party") commit a material breach of any material provision of this agreement and should such breach be: 5.1 Incapable of remedy; or 2 5.2 be capable of being remedied and should such party fail to remedy such breach within seven days after receiving written notice from another party the ("aggrieved party") requiring the defaulting party to do so, then the aggrieved party shall be entitled, without prejudice to its other rights in law, to cancel this agreement or to claim immediate specific performance of all of the defaulting party's obligations whether or not due for performance, neither event without prejudice to the aggrieved party's right to claim damages. 6. DOMICILIUM AND NOTICES 6.1 The parties choose domicilium otandi et executandi for all purposes of the giving of any notice, the payment of any sum, the serving of any process and for any other purpose arising from this agreement as follows: 6.1.1 SAPET 9 Fricker Road Illovo Boulevard Illovo fax (011) 507-1557 6.1.2 SAPEF Walker House P.O. Box 255 GT Mary Street George Town Grand Cayman Cayman Islands fax (345) 949-7836 6.1.3 NEWCO 9 Fricker Road Illovo Boulevard Illovo fax (011) 507-1557 3 6.2 Each party shall be entitled from time to time, by written notice to the others, to vary its domicilium to any other physical address within the Republic of South Africa and/or its fax number. 6.3 Any notice given and any payment made by a party to another party which is delivered by hand during the normal business hours of the addressee at the addressee's domicilium shall be rebuttably presumed to have been received by the addressee at the time of delivery. 6.4 Any notice given by a party to another party by fax shall be rebuttably presumed to have been received by the addressee on the date of successful transmission thereof. 6.5 Notwithstanding anything to the contrary in this ___ a written notice or other communication actually received by a party shall be adequate notice to it notwithstanding that the notice was not delivered to its given domicilium. 7. GENERAL 7.1 This document constitutes the sole record of this agreement between the parties in relation to its subject matter. 7.2 No party shall be bound by any representation, warranty, promise or the like not recorded in this document. 7.3 No addition to, variation, novation or agreed cancellation of this agreement shall be of any force or effect unless in writing and signed by or on behalf of the parties. 7.4 No suspension of a right to enforce any term of this agreement and no pactum de non petendo shall be of any force or effect unless in writing and duly signed by or on behalf of the parties. 4 7.5 No indulgence which a party may grant to another party shall constitute a waiver of any of the rights of the grantor unless in writing signed by both parties. 7.6 All costs, charges and expenses of any nature whatever which may be incurred by a party in enforcing its rights in terms of this agreement, including without limiting the generality of the aforegoing, legal costs on the scale of attorney and own client and collection commission, irrespective of whether any action has been instituted, shall be recoverable on demand from the party against which such rights are successfully enforced and shall be payable on demand. 7.7 The provisions of this agreement shall be binding upon the successors-in-title and the permitted assigns of the parties. Accordingly, the rights and obligations of each party pursuant to this agreement shall devolve upon and bind its successors-in-title and permitted assigns. 7.8 All provisions in this agreement are, notwithstanding the manner in which they have been put together or linked grammatically, severable from each other. Any provision of this agreement which is or becomes unenforceable in any jurisdiction, whether due to voidness, invalidity, illegality, unlawfulness or for any other reason whatsoever, shall, in such jurisdiction only and only to the extent that it is so unenforceable, be treated as pro non scripto and the remaining provisions of this agreement shall be of full force and effect. The parties declare that it is their intention that this agreement would be executed without such unenforceable provisions if they were aware of such unenforceability at the time of its execution. 5 8. COSTS Each party shall bear and pay its own fees and costs of and incidental to the negotiation, drafting, preparation and execution of this agreement. THUS DONE and SIGNED at ILLOVO on this the 5th day of NOVEMBER 2003. For and on behalf of SOUTH AFRICAN PRIVATE EQUITY TRUST III (herein represented by BRAIT CAPITAL PARTNERS TRUSTEE (PTY) LIMITED by ------------------------------------------------- who warrants his authority hereto THUS DONE and SIGNED at ILLOVO on this the 5th day of NOVEMBER 2003. For and on behalf of SOUTH AFRICAN PRIVATE EQUITY TRUST III (herein represented by SAPE INTERNATIONAL GP LTD) by ------------------------------------------------- who warrants his authority hereto THUS DONE and SIGNED at ILLOVO on this the 5th day of NOVEMBER 2003. For and on behalf of NEWSHELF 713 (PTY) LIMITED by ------------------------------------------------- who warrants his authority hereto EX-99.D 5 y98296exv99wd.txt DEED OF DELEGATION AND ASSUMPTION EXHIBIT E [PAUL BOTHA LOGO] DEED OF DELEGATION AND ASSUMPTION Between THE SOUTH AFRICAN PRIVATE EQUITY FUND III L.P. THE SOUTH AFRICAN PRIVATE EQUITY TRUST III BRENTHURST PRIVATE EQUITY SOUTH AFRICA I LIMITED BRENTHURST PRIVATE EQUITY II LIMITED ROSE NOMINEES LIMITED and THE TRUSTEES OF THE NEW APLITEC PARTICIPATION TRUST DEED OF DELEGATION AND [PAUL BOTHA LOGO] ASSUMPTION CONTENTS 1. INTERPRETATION 1 2. INTRODUCTION 6 3. SUSPENSIVE CONDITION 7 4. DELEGATION AND ASSUMPTION 8 5. DETERMINATION OF EXTENT OF OBLIGATIONS 8 6. PAYMENT 10 7. DOMICILIUM AND NOTICES 10 8. APPLICABLE LAW 12 9. GENERAL 12 10. COSTS 13 11. COUNTERPARTS 13
DEED OF DELEGATION AND [PAUL BOTHA LOGO] ASSUMPTION 1 1. INTERPRETATION In this agreement - 1.1 clause headings are for convenience purposes only and shall not be used in its interpretation; 1.2 unless the context clearly indicates a contrary intention: 1.2.1 an expression which denotes any gender includes the other genders, a natural person includes an artificial person and vice versa and the singular includes the plural and vice versa; 1.2.2 where any term is defined within a particular clause, other than the interpretation clause, that term shall bear the meaning ascribed to it in that clause wherever it is used in this agreement; 1.2.3 the following expressions shall bear the following meanings and related expressions shall bear corresponding meanings - 1.2.3.1 "acquisition agreement" means the agreement whereby New Aplitec will acquire all the assets and liabilities of the Aplitec Group, but excluding ZAR 300 million in cash and additional cash sufficient to result in the distribution of an extra ZAR 25 cents (after payment of any STC thereon) per Aplitec share to Aplitec shareholders who elect the cash option and the shares in Country On A Card (Proprietary) Limited, Net1 Loyalty (Proprietary) Limited and Net1 Payroll (Proprietary) Limited; 1.2.3.2 "Aplitec" means Net1 Applied Technology Holdings Limited, Registration Number 1997/007207/06, a public company incorporated in the RSA; 1.2.3.3 "Aplitec Group" means Aplitec and all its subsidiaries; 1.2.3.4 "Aplitec Holdings Participation Trust" means the Aplitec Holdings Participation Trust, a Star trust established in the Cayman Islands; 1.2.3.5 "Aplitec shareholder" means a holder of Aplitec shares; DEED OF DELEGATION AND [PAUL BOTHA LOGO] ASSUMPTION 2 1.2.3.6 "Aplitec shares" means ordinary shares of ZAR 0,1 cent each in the issued share capital of Aplitec; 1.2.3.7 "B class loan account" means the B class loan account against New Aplitec in the sum of ZAR 101,004 cents, to be credited to the New Aplitec Participation Trust as fully paid up for each Aplitec share in respect of which an Aplitec shareholder exercises the reinvestment option or to SAPEF and SAPET in terms of the underwriting agreement; 1.2.3.8 "B class preference share" means a B class preference share in the issued share capital of New Aplitec to be issued to the New Aplitec Participation Trust credited as fully paid up for each Aplitec share in respect of which an Aplitec shareholder exercises the reinvestment option or to SAPEF and SAPET in terms of the underwriting agreement; 1.2.3.9 "Brenthurst I" means Brenthurst Private Equity South Africa I Limited, Registration Number 562615, a company incorporated in the British Virgin Islands; 1.2.3.10 "Brenthurst II" means Brenthurst Private Equity II Limited, Registration Number 514615, a company incorporated in the British Virgin Islands; 1.2.3.11 "cash option" means the cash option referred to in clause 2.3.1; 1.2.3.12 "common shares" means common shares in the authorised share capital of NUEP having the rights of ordinary shares; 1.2.3.13 "common stock purchase agreement" means the agreement entered into between NUEP and SAPEF III International G.P. Limited on 30 January 2004 whereby NUEP will issue to SAPEF III International G.P. Limited (or its nominee) 105 661 428 common shares in consideration for cash in the amount of US$0,50 per common share and the procurement of the assignment of all the issued A ordinary shares in New Aplitec to NUEP; DEED OF DELEGATION AND [PAUL BOTHA LOGO] ASSUMPTION 3 1.2.3.14 "condition" means the suspensive condition referred to in clause 3; 1.2.3.15 "distribution ratio" means the ratio in which the special convertible preference shares shall be distributed on the occurrence of a trigger event, which at the closing date of the acquisition agreement, shall be 0,814285714 special convertible preference shares for every one B class preference share. If after the closing date NUEP consolidates or sub-divides the common shares, the special convertible preference shares shall be consolidated or sub-divided in the same proportions, and the distribution ratio shall be adjusted accordingly; 1.2.3.16 "effective date" means the date that SAPEF and SAPET's obligations to underwrite the reinvestment option become effective in terms of the underwriting agreement; 1.2.3.17 "New Aplitec" means Net1 Applied Technologies South Africa Limited, Registration Number 2002/031446/06, formerly known as Newshelf 713 (Proprietary) Limited, a company incorporated in the RSA; 1.2.3.18 "New Aplitec Participation Trust" means the New Aplitec Participation Trust, Master's Reference Number IT 8094/03, a bewind trust registered in the RSA, represented herein by its trustee, First National Asset Management and Trust Company (Proprietary) Limited; 1.2.3.19 "NUEP" means Net1 UEPS Technologies, Inc., IRS Employer Number 65/0903895, a company incorporated in Florida in the United States of America; 1.2.3.20 "reinvestment option" means the reinvestment option referred to in clause 2.3.2; 1.2.3.21 "reinvesting shareholders" means those Aplitec shareholders who elect the reinvestment option; 1.2.3.22 "Rose" means Rose Nominees Limited, Registration Number A/C 20423, a company incorporated in Guernsey; 1.2.3.23 "RSA" means the Republic of South Africa; DEED OF DELEGATION AND [PAUL BOTHA LOGO] ASSUMPTION 4 1.2.3.24 "SAPEF" means the South African Private Equity Fund III, L.P., a limited liability partnership incorporated in the Cayman Islands, represented herein by its general partner, SAPEF III International G.P. Limited; 1.2.3.25 "SAPET" means the South African Private Equity Trust III, Master's Reference Number IT9960/1998, a trust established in the RSA, represented herein by its trustee, Brait Capital Partners Trustees (Proprietary) Limited; 1.2.3.26 "signature date" means the date upon which this agreement has been signed by all the parties; 1.2.3.27 "special convertible preference shares" means special convertible preference shares in NUEP; 1.2.3.28 "trigger event" means: 1.2.3.28.1 a unit holder notifies the Trustees of the New Aplitec Participation Trust in writing that he wishes the New Aplitec Participation Trust to dispose of the shares and loan account attributable to some or all of his units; or 1.2.3.28.2 New Aplitec is wound-up or placed under judicial management, whether provisionally or finally; or 1.2.3.28.3 NUEP is wound up or placed under judicial management, whether provisionally or finally; or 1.2.3.28.4 South African Exchange Controls are relaxed or abolished, permitting unit holders to hold the common shares directly; 1.2.3.29 "underwriting agreement" means the underwriting agreement entered into between SAPEF, SAPET and New Aplitec on 5 November 2003 whereby SAPEF and SAPET undertook to underwrite the reinvestment option and, via the New Aplitec Participation Trust, to subscribe for any the B class preference shares and B class loan accounts not taken up because the Aplitec shareholders elect the cash option rather than the reinvestment option, but limited to a DEED OF DELEGATION AND [PAUL BOTHA LOGO] ASSUMPTION 5 maximum sum of ZAR 436 972 343,10; 1.2.3.30 "unit" means a unit in the New Aplitec Participation Trust, comprising a capital contribution of 183,996 cents and a loan contribution of ZAR 101,004 cents; 1.2.3.31 "unit holder" means a person who from time to time holds units; 1.2.3.32 "US$" means dollars, the currency of the United States; 1.2.3.33 "ZAR" means Rands, the currency of the RSA; 1.3 the terms "holding company" and "subsidiary" shall bear the meaning assigned to them in the Act; 1.4 should any provision in a definition be a substantive provision conferring rights or imposing obligations on any party, then effect shall be given to that provision as if it were a substantive provision in the body of this agreement; 1.5 any reference to an enactment, regulation, rule or by-law is to that enactment, regulation, rule or by-law as at the signature date, and as amended or replaced from time to time; 1.6 when any number of days is prescribed, such number shall exclude the first and include the last day, unless the last day falls on a Saturday, Sunday or public holiday in the RSA, in which case the last day shall be the next succeeding day which is not a Saturday, Sunday or public holiday; 1.7 any schedule or annexure to this agreement shall form part of this agreement; 1.8 the use of the word "including" followed by a specific example/s shall not be construed as limiting the meaning of the general wording preceding it and the eiusdem generis rule shall not be applied in the interpretation of such general wording or such specific example/s; 1.9 the expiration or termination of this agreement shall not affect those provisions of this agreement which expressly provide that they will operate after any such expiration or termination or which of necessity must continue to have effect after such expiration or termination, notwithstanding the fact that the clauses DEED OF DELEGATION AND [PAUL BOTHA LOGO] ASSUMPTION 6 themselves do not expressly provide this; 1.10 in its interpretation, the contra proferentem rule of construction shall not apply (this agreement being the product of negotiations between the parties) nor shall this agreement be construed in favour of or against any party by reason of the extent to which any party or its professional advisors participated in the preparation of this agreement; and 1.11 recordals shall be binding on the parties and are not merely for information purposes. 2. INTRODUCTION 2.1 In terms of the acquisition agreement, New Aplitec will acquire all the assets and liabilities of the Aplitec Group. 2.2 Pursuant to the acquisition agreement, it is intended that Aplitec will be voluntarily wound up and that the Aplitec shareholders will receive the consideration payable by New Aplitec for Aplitec's assets and liabilities in the form of the advance distribution of a liquidation dividend. 2.3 The Aplitec shareholders will be entitled to receive the advance distribution, of 475 cents per Aplitec share plus an additional 25 cents per Aplitec share for those Aplitec shareholders who elect the cash option, in whole or in part at their election as follows: 2.3.1 THE CASH OPTION 500 cents in cash in respect of each Aplitec share; and/or 2.3.2 THE REINVESTMENT OPTION In respect of each Aplitec share, an amount of 190 cents in cash and the balance in the form of a reinvestment in New Aplitec via the New Aplitec Participation Trust, comprising one B class preference share to the value of 183,996 cents and a B class loan account of 101,004 cents by way of nil paid renounceable letters of allocation issued by New Aplitec, which will be deemed to have been renounced by the Aplitec shareholders in favour of the New Aplitec Participation Trust. In addition, the New Aplitec DEED OF DELEGATION AND [PAUL BOTHA LOGO] ASSUMPTION 7 Participation Trust, for the benefit of the relevant Aplitec shareholders, will be granted the right by the Aplitec Holdings Participation Trust to receive special convertible preference shares in the distribution ratio in due course on the occurrence of a trigger event. 2.4 Those Aplitec shareholders who choose to receive the consideration payable to them in whole or in part by way of the reinvestment option shall subscribe for and shall be issued with one unit credited as fully paid for each share in Aplitec in respect of which they exercise the reinvestment option. 2.5 In turn, the New Aplitec Participation Trust shall be issued with one B class preference share, to the value of 183,996 cents, and one B class loan account in the sum of 101,004 cents, both credited as fully paid, for each Aplitec share in respect of which the reinvestment option is exercised. 2.6 In terms of the underwriting agreement, SAPEF and SAPET are obliged, via the New Aplitec Participation Trust, to subscribe for any B class preference shares and B class loan accounts not taken up as a result of the Aplitec shareholders electing the cash option rather than the reinvestment option, up to a maximum sum of R 436 972 343,10. 2.7 Brenthurst I, Brenthurst II and Rose wish to assume certain of the obligations of SAPEF and SAPET under the underwriting agreement and SAPEF and SAPET are willing to delegate to Brenthurst I, Brenthurst II and Rose these obligations on the terms and conditions of this agreement. 3. SUSPENSIVE CONDITION 3.1 This entire agreement, save for the provisions of clause 1, this clause 3, and clauses 7 to 10, which shall be of immediate force and effect, is subject to the underwriting agreement becoming unconditional. 3.2 The condition has been expressed for the benefit of all the parties. 3.3 The parties shall use their best endeavours to procure the fulfillment of the condition as soon as reasonably possible after the signature date. 3.4 In the event that the suspensive condition is not fulfilled or waived timeously, then DEED OF DELEGATION AND [PAUL BOTHA LOGO] ASSUMPTION 8 save for the provisions of clause 1, this clause 3, and clauses 7 to 10, which shall remain effective, this agreement shall never become of any force or effect and no party shall have any claim against any other party for anything done hereunder or arising herein, save as a result of a breach of any of the provisions of clause 3.3 by a party, and the parties shall be restored to the status quo ante. 4. DELEGATION AND ASSUMPTION SAPEF and SAPET hereby delegate a portion of their obligations under the underwriting agreement as determined in clause 5 to Brenthurst I, Brenthurst II and Rose, and Brenthurst I, Brenthurst II and Rose hereby assume such obligations from SAPEF and SAPET with effect from the effective date. 5. DETERMINATION OF EXTENT OF OBLIGATIONS 5.1 If the total capital required in terms of the common stock purchase agreement and the underwriting agreement is between US$52 830 714,00 and US$93 798 203,49 (based on an exchange rate of ZAR7,00 to US$1,00), the amount of the obligations assumed by Rose under the underwriting agreement shall be determined in accordance with the following formula: Y = (0,0122047996X + 0,3552117220 - 1,0) * 7 Where: X = total capital required in terms of the common stock purchase agreement and the underwriting agreement in US$ Million (based on an exchange rate of ZAR7,00 to US$1,00) Y = total underwriting required from Rose in ZAR million. 5.2 If the total capital required in terms of the common stock purchase agreement and the underwriting agreement is between US$93 798 203,49 and US$115 255 308,73 (based on an exchange rate of ZAR7,00 to US$1,00), the amount of the obligations assumed by Rose under the underwriting agreement shall be ZAR 3 500 000,00. 5.3 Brenthurst I and Brenthurst II shall assume portion of SAPEF and SAPET's DEED OF DELEGATION AND [PAUL BOTHA LOGO] ASSUMPTION 9 obligations under the underwriting agreement as determined in terms of clauses 5.4 and 5.5 in the proportions Brenthurst I 33.33% and Brenthurst II 66.66% until the obligations of Brenthurst I reach US$ 5 000 000,00 from which point Brenthurst II shall assume 100%. 5.4 If the total capital required in terms of the common stock purchase agreement and the underwriting agreement is between US$52 830 714,00 and US$93 798 203,49 (based on an exchange rate of ZAR7,00 to US$1,00), the extent of the obligations under the underwriting agreement assumed by Brenthurst I and Brenthurst II in the proportions set out in clause 5.3 shall be determined in accordance with the following formula: Y = (0,158662395X + 0,1177523858 - 8,5) * 7 Where: X = total capital required in terms of the common stock purchase agreement and the underwriting agreement in US$ Million (based on an exchange rate of ZAR7,00 to US$1,00) Y = total underwriting required from Brenthurst I and Brenthurst II in the proportions referred to in clause 5.3 in ZAR million. 5.5 If the total capital required in terms of the common stock purchase agreement and the underwriting agreement is between US$93 798 203,49 and US$115 255 308,73 (based on an exchange rate of ZAR7,00 to US$1,00), the extent of the obligations under the underwriting agreement assumed by Brenthurst I and Brenthurst II in the proportions set out in clause 5.3 shall be determined in accordance with the following formula: Y = (0,2097207405X - 4,6714286903 - 8,5) * 7 Where: X = total capital required in terms of the common stock purchase agreement and the underwriting agreement in US$ Million (based on an exchange rate of ZAR7,00 to US$1,00) Y = total underwriting required from Brenthurst I and Brenthurst II in the DEED OF DELEGATION AND [PAUL BOTHA LOGO] ASSUMPTION 10 proportions referred to in clause 5.3 in ZAR million. 6. PAYMENT 6.1 The New Aplitec Participation Trust has appointed SAPEF and SAPET as its agents to pay directly to New Aplitec the amount they are obliged to pay on the date that payment must be made in terms of the underwriting agreement, rather than making payment to the New Aplitec Participation Trust, which in turn would then have to pay the amounts in question to New Aplitec. 6.2 Similarly, the New Aplitec Participation Trust hereby appoints Brenthurst I, Brenthurst II and Rose to pay directly to New Aplitec the amount they are obliged to pay in terms of this agreement on the date that payment is required in terms of the underwriting agreement. 6.3 The B class preference shares issued and B class loan accounts credited pursuant to the payments contemplated in clause 6.2 will be issued and credited to the New Aplitec Participation Trust, not to Brenthurst I, Brenthurst II and Rose. 6.4 Upon payment as contemplated in clause 6.2, the New Aplitec Participation Trust will credit Brenthurst I, Brenthurst II and Rose in its books with one unit for every one B class preference share and B class loan account subscribed for by Brenthurst I, Brenthurst II and Rose as agent for the New Aplitec Participation Trust. 6.5 Brenthurst I, Brenthurst II and Rose shall pay any amounts they are required to pay in terms of this agreement to New Aplitec in cash, free of exchange, deduction or set off, by electronic transfer to the bank account nominated by New Aplitec in writing. 7. DOMICILIUM AND NOTICES 7.1 The parties choose domicilium citandi et executandi for all purposes of the giving of any notice, the payment of any sum, the serving of any process and for any other purpose arising from this agreement, as follows: DEED OF DELEGATION AND [PAUL BOTHA LOGO] ASSUMPTION 11 Brenthurst I and II: 9 Columbus Centre Pelican Drive Road Town Tortola British Virgin Islands Fax: +352 477 181 212 For attention P Krzysica Rose: The Grange St Peter Port Guernsey GY1 3AP Channel Islands Fax: +44 (0) 1481 714796 For attention: Simon Masterton SAPEF: Walker House P O Box 265 GT Mary Street George Town Grand Cayman Cayman Islands Fax: (345) 9497886 For attention SAPET: 9 Fricker Road Illovo Boulevard Illovo Sandton RSA Fax: +27 11 507 1557 For attention Polly Car The New Aplitec Participation Trust Mezzanine Floor 1 First Place Bank City Corner Simmonds and Pritchard Streets Johannesburg Fax: +27 11 442 5244 For attention Ina Strode 7.2 Each party shall be entitled from time to time, by written notice to the other/s, to vary its domicilium to any other physical address. 7.3 Any notice given and any payment made by a party to another party which is DEED OF DELEGATION AND [PAUL BOTHA LOGO] ASSUMPTION 12 delivered by hand during the normal business hours of the addressee at the addressee's domicilium shall be rebuttably presumed to have been received by the addressee at the time of delivery. 7.4 Any notice given by a party to another party by fax shall be rebuttably presumed to have been received by the addressee on the date of successful transmission thereof. 7.5 Notwithstanding anything to the contrary in this clause 7, a written notice or other communication actually received by a party shall be adequate notice to it notwithstanding that the notice was not delivered to its given domicilium. 8. APPLICABLE LAW All matters arising from or in connection with this agreement, its validity, existence or termination shall be determined in accordance with the laws for the time being of the RSA and the parties hereby submit to the non-exclusive jurisdiction of the High Court of South Africa, Witwatersrand Local Division. 9. GENERAL 9.1 This document constitutes the sole record of the agreement between the parties in relation to its subject matter. 9.2 No party shall be bound by any representation, warranty, promise or the like not recorded in this document. 9.3 No addition to, variation, novation or agreed cancellation of this agreement shall be of any force or effect unless in writing and signed by or on behalf of the parties. 9.4 No suspension of a right to enforce any term of this agreement and no pactum de non petendo shall be of any force or effect unless in writing and duly signed by or on behalf of the parties. 9.5 No indulgence which a party may grant to another party shall constitute a waiver of any of the rights of the grantor unless in writing signed by both parties. 9.6 All costs, charges and expenses of any nature whatever which may be incurred DEED OF DELEGATION AND [PAUL BOTHA LOGO] ASSUMPTION 13 by a party in enforcing its rights in terms of this agreement, including without limiting the generality of the aforegoing, legal costs on the scale of attorney and own client and collection commission, irrespective of whether any action has been instituted, shall be recoverable on demand from the party against which such rights are successfully enforced and shall be payable on demand. 9.7 The provisions of this agreement shall be binding upon the successors-in-title- and the permitted assigns of the parties. Accordingly, the rights and obligations of each party pursuant to this agreement shall devolve upon and bind its successors-in-title and permitted assigns. 9.8 All provisions in this agreement are, notwithstanding the manner in which they have been put together or linked grammatically, severable from each other. Any provision of this agreement which is or becomes unenforceable in any jurisdiction, whether due to voidness, invalidity, illegality, unlawfulness or for any other reason whatsoever, shall, in such jurisdiction only and only to the extent that it is so unenforceable, be treated as pro non scripto and the remaining provisions of this agreement shall be of full force and effect. The parties declare that it is their intention that this agreement would be executed without such unenforceable provisions if they were aware of such unenforceability at the time of its execution. 10. COSTS Each party shall bear and pay its own fees and costs of and incidental to the negotiation, drafting, preparation and execution of this agreement. 11. COUNTERPARTS This agreement may be signed in separate counterparts, each of which shall be deemed to be an original and all of which taken together shall constitute one and the same instrument. A counterpart of this agreement in telefax form shall be conclusive evidence of the original signature and shall be as effective in law as the counterparts in original form showing the original signatures. DEED OF DELEGATION AND [PAUL BOTHA LOGO] ASSUMPTION 14 Signed at on 2004 - -------------------------------------------------------------------------------- THE SOUTH AFRICAN PRIVATE EQUITY FUND III L.P. who warrants that he is duly authorised hereto Signed at on 2004 - -------------------------------------------------------------------------------- THE SOUTH AFRICAN PRIVATE EQUITY TRUST III who warrants that he is duly authorised hereto Signed at on 2004 - -------------------------------------------------------------------------------- BRENTHURST PRIVATE EQUITY SOUTH AFRICA I LIMITED who warrants that he is duly authorised hereto Signed at on 2004 - -------------------------------------------------------------------------------- BRENTHURST PRIVATE EQUITY II LIMITED who warrants that he is duly authorised hereto DEED OF DELEGATION AND [PAUL BOTHA LOGO] ASSUMPTION 15 Signed at on 2004 - -------------------------------------------------------------------------------- ROSE NOMINEES LIMITED who warrants that he is duly authorised hereto Signed at on 2004 - -------------------------------------------------------------------------------- THE NEW APLITEC PARTICIPATION TRUST who warrants that he is duly authorised hereto EX-99.E 6 y98296exv99we.txt JOINT FILING AGREEMENT EXHIBIT E JOINT FILING AGREEMENT Each of the undersigned acknowledges and agrees that the foregoing statement on Schedule 13D is filed on behalf of the undersigned and that all subsequent amendments to this statement on Schedule 13D shall be filed on behalf of the undersigned without the necessity of filing additional joint acquisition statements. Each of the undersigned acknowledges that it shall be responsible for the timely filing of such amendments, and for the completeness and accuracy of the information concerning it contained therein, but shall not be responsible for the completeness and accuracy of the information concerning the other, except to the extent that he or it knows or has reason to believe that such information is inaccurate. Dated as of June 17, 2004 BRENTHURST PRIVATE EQUITY II LIMITED By: /s/ Sir Chippendale Keswick ----------------------------- Name: Sir Chippendale Keswick Title: Director BRENTHURST PRIVATE EQUITY SOUTH AFRICA I LIMITED By: /s/ Sir Chippendale Keswick ----------------------------- Name: Sir Chippendale Keswick Title: Director BRENTHURST LIMITED By: /s/ Sir Chippendale Keswick ----------------------------- Name: Sir Chippendale Keswick Title: Director Page 16 of 17 Pages THESEUS LIMITED By: /s/ John Whillis ------------------- Name: John Whillis Title: Director MAITLAND TRUSTEES LIMITED By: /s/ John Whillis ------------------- Name: John Whillis Title: Director Page 17 of 17 Pages -----END PRIVACY-ENHANCED MESSAGE-----