Schedule 13D

-----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, IJEPFag848/AOO+xfXZ7WOxla88Y/z4GnIch+kyEWzsh0sc1H/Tg5XMXR4+2/ss9 zH3rFhD06SR040/vqKka+A== 0001193125-09-092221.txt : 20090429 0001193125-09-092221.hdr.sgml : 20090429 20090429171619 ACCESSION NUMBER: 0001193125-09-092221 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20090429 DATE AS OF CHANGE: 20090429 GROUP MEMBERS: ALAN W. STEINBERG GROUP MEMBERS: GARY J. FROHMAN GROUP MEMBERS: THOMAS M. YEHLE FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: STEINBERG ALAN W L P CENTRAL INDEX KEY: 0001056309 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: 1501 VENERA AVENUE STREET 2: SUITE 205 CITY: CORRAL GABLES STATE: FL ZIP: 33146 BUSINESS PHONE: 3056675632 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: MDU COMMUNICATIONS INTERNATIONAL INC CENTRAL INDEX KEY: 0001086139 STANDARD INDUSTRIAL CLASSIFICATION: COMMUNICATION SERVICES, NEC [4899] IRS NUMBER: 841342898 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-79111 FILM NUMBER: 09780110 BUSINESS ADDRESS: STREET 1: 60 COMMERCE WAY STREET 2: UNIT D CITY: TOTOWA STATE: NJ ZIP: 07512 BUSINESS PHONE: 9732379499 MAIL ADDRESS: STREET 1: 60 COMMERCE WAY STREET 2: UNIT D CITY: TOTOWA STATE: NJ ZIP: 07512 SC 13D 1 dsc13d.htm SCHEDULE 13D Schedule 13D

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No. )

MDU COMMUNICATIONS INTERNATIONAL, INC.

(Name of Issuer)

Common Stock, $0.001 par value per share

(Title of Class of Securities)

582828109

(CUSIP Number)

Dennis J. Olle

Carlton Fields, P.A.

Bank of America Tower of International Plaza

100 SE Second Street, Suite 4000

Miami, FL 33131-2114

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

April 20, 2009

(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 Sections 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. ¨.

The information required for the remainder of this cover page shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “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).

SCHEDULE 13D


CUSIP No. 582828109		Page 2 of 10 Pages


1	NAME OF REPORTING PERSON The Alan W. Steinberg Limited Partnership
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) x (b) ¨
3	SEC USE ONLY
4	SOURCE OF FUNDS OO⁽¹⁾
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(E):	¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION United States


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7 SOLE VOTING POWER 0
		8 SHARED VOTING POWER 1,494,933⁽²⁾
		9 SOLE DISPOSITIVE POWER 0
		10 SHARED DISPOSITIVE POWER 1,494,933


11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,494,933 shares of Common Stock
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES	¨
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 2.82%
14	TYPE OF REPORTING PERSON PN

1.	Shares were previously owned prior to entering into the Stock Option Agreement described in Items 4 and 6 of this Schedule 13D.

2.	Under the limited irrevocable proxy described in Items 4 and 6 of this Schedule 13D, the reporting person retains voting control with respect to the shares under certain circumstances.

SCHEDULE 13D


CUSIP No. 582828100		Page 3 of 10 Pages


1	NAME OF REPORTING PERSON Gary J. Frohman
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) x (b) ¨
3	SEC USE ONLY
4	SOURCE OF FUNDS OO⁽¹⁾
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(E):	¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION United States


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7 SOLE VOTING POWER 15,000
		8 SHARED VOTING POWER 2,064,933⁽²⁾
		9 SOLE DISPOSITIVE POWER 15,000
		10 SHARED DISPOSITIVE POWER 2,064,933 ⁽²⁾⁽³⁾


11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,079,933 shares of Common Stock ⁽³⁾
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES	¨
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 3.83% ⁽³⁾
14	TYPE OF REPORTING PERSON IN

1.	Shares were previously owned prior to entering into the AWS Option described in Items 4 and 6 of this Schedule 13D.

2.	Under the limited irrevocable proxies described in Items 4 and 6 of this Schedule 13D, the reporting person retains voting control with respect to the shares under certain circumstances.

3.	Includes shares held by Alan W. Steinberg Limited Partnership and Riviera-Enid Limited Partnership described in Item 4 of this Schedule 13D.

SCHEDULE 13D


CUSIP No. 582828109		Page 4 of 10 Pages


1	NAME OF REPORTING PERSON Alan W. Steinberg
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) x (b) ¨
3	SEC USE ONLY
4	SOURCE OF FUNDS OO⁽¹⁾
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(E):	¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION United States


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7 SOLE VOTING POWER 0
		8 SHARED VOTING POWER 2,064,933⁽²⁾
		9 SOLE DISPOSITIVE POWER 0
		10 SHARED DISPOSITIVE POWER 2,064,933 ⁽²⁾⁽³⁾


11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,064,933 shares of Common Stock ⁽³⁾
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES	¨
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 3.90% ⁽³⁾
14	TYPE OF REPORTING PERSON IN

1.	Shares were previously owned prior to entering into the AWS Option described in Items 4 and 6 of this Schedule 13D.

2.	Under the limited irrevocable proxies described in Items 4 and 6 of this Schedule 13D, the reporting person retains voting control with respect to the shares under certain circumstances.

3.	Includes shares held by Alan W. Steinberg Limited Partnership and Riviera-Enid Limited Partnership described in Item 4 of this Schedule 13D.

SCHEDULE 13D


CUSIP No. 582828100		Page 5 of 10 Pages


1	NAME OF REPORTING PERSON Thomas M Yehle
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) x (b) ¨
3	SEC USE ONLY
4	SOURCE OF FUNDS OO⁽¹⁾
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(E):	¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION United States


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7 SOLE VOTING POWER 0
		8 SHARED VOTING POWER 2,064,933 ⁽²⁾⁽³⁾
		9 SOLE DISPOSITIVE POWER 0
		10 SHARED DISPOSITIVE POWER 2,064,933 ⁽²⁾⁽³⁾


11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,064,933 shares of Common Stock ⁽³⁾
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES	¨
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 3.90% ⁽³⁾
14	TYPE OF REPORTING PERSON IN

1.	Shares were previously owned prior to entering into the ASW Option described in Items 4 and 6 of this Schedule 13D.

2.	Under the limited irrevocable proxies described in Items 4 and 6 of this Schedule 13D, the reporting person retains voting control with respect to the shares under certain circumstances.

3.	Includes shares held by Alan W. Steinberg Limited Partnership and Riviera-Enid Limited Partnership described in Item 4 of this Schedule 13D.

Item 1.

Security and Issuer

This Schedule 13D (this “Schedule 13D”) relates to shares of common stock, $0.001 par value per share (“Common Stock”), of MDU Communications International, Inc., a Delaware corporation (the “Issuer” or the “Company”), whose principal executive offices are located at 60 Commerce Way, Unit D, Totowa, New Jersey 07512.

Item 2.

Identity and Background

This Schedule 13D is filed on behalf of Alan W. Steinberg Limited Partnership, a New York limited partnership (“AWS”), and its general partners, consisting of Messrs. Gary J. Frohman, Alan W. Steinberg, and Thomas M. Yehle (collectively, the “General Partners”). AWS is a privately-held limited partnership which invests in various types of securities for the benefit of its investors. Mr. Steinberg serves as the managing general partner of AWS. Each of Messrs. Steinberg, Frohman and Yehle is a citizen of the United States and their principal occupations consist of managing limited partnerships which invest in securities for the benefit of its investors. AWS and Messrs. Steinberg, Frohman and Yehle are sometimes referred to collectively herein as the “Reporting Persons.” The principal executive offices of AWS, and the business address of each of the General Partners is 1501 Venera Avenue, Suite 205, Coral Gables, FL 33146.

During the past five years, none of the Reporting Persons has been convicted in a criminal proceeding (excluding traffic violations and similar misdemeanors) and none has been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction as a result of which any such person 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

AWS purchased the Common Stock of the Issuer as identified in Item 5 below for an aggregate purchase price of $2,691,436.75. The purchase price was paid out of the working capital of AWS. No payments were made to AWS or by AWS in connection with the AWS Option or the AWS Proxy described in Items 4 and 6 of this Schedule 13D.

Item 4.

Purpose of Transaction

AWS originally acquired the Common Stock for investment purposes. Subsequently, AWS has entered into a Stock Option Agreement, dated April 20, 2009, by and among AWS and DED Enterprises, Inc., a Florida corporation (“DED Enterprises”), Carpathian Holding Company, Ltd. (“CHC”); Nevis, and Carpathian Resources, Ltd.: Australia (“CPN”), pursuant to which AWS has granted DED Enterprises an option (the “AWS Option”) to purchase up to 1,494,933 shares of Common Stock (the “Optioned Shares”) at a purchase price of $0.48 per share. CHC owns 100% of the outstanding common stock of DED Enterprises and CPN owns 100% of the common stock of CHC. The Option, which is immediately exercisable, expires on March 9, 2012. In the event that DED Enterprises or its affiliates should exercise the AWS Option and subsequently resell the Optioned Shares to a non-affiliate of DED Enterprises, DED Enterprises shall pay to AWS 50% of the difference between the amount realized from the sale of those Optioned Shares sold (net of commission) and the exercise price paid by DED Enterprises for those Optioned Shares sold. Notwithstanding the foregoing, AWS may sell the Optioned Shares to a third party (a) if it provides DED Enterprises with a right of first refusal, and (b) upon sale, AWS pays to DED Enterprises 50% of the proceeds (net of commissions) received per share in excess of $0.48 from such sale (and if such sales price does not exceed 0.48 per share, net of commission, no amounts will be paid to DED Enterprises).

In connection with the grant of the AWS Option, AWS also provided DED Enterprises with a limited irrevocable proxy to, subject to certain restrictions, any and all shares of Common Stock held by AWS (the “AWS Proxy”). The AWS Proxy expires on April 20, 2010. Generally, the AWS Proxy provides DED Enterprises with the right to vote the shares of Common Stock subject thereto in its sole discretion, except that DED Enterprises is not permitted to vote with respect to matters that (i) would adversely

Page 6 of 10 Pages

affect the rights of AWS as a shareholder of the Issuer, (ii) involve significant transactions between DED Enterprises, its parent entities, or any parties related thereto, or (iii) involve a merger, consolidation, recapitalization, liquidation, sale of substantially all of the assets of, or other similar transactions involving, the Issuer.

Further, under the terms of the AWS Option, if DED Enterprises, its parent entities, or any of their affiliates (the “Acquirers”) should obtain a controlling interest (as defined therein) in the Issuer; then AWS shall have the right to designate a director nominee to the Board of Directors of the Issuer and the Acquirers and their affiliates would be required to vote or cause to be voted all shares of the Issuer’s voting securities over which they have voting power or authority, directly or indirectly, in favor of the election of such director nominee.

Simultaneously with the grant of the AWS Option and the AWS Proxy, Riveria-Enid Limited Partnership, a Florida limited partnership which is operated by the same general partner as AWS (“RELP”) entered into similar arrangements with DED Enterprises, CHC and CPN. In this regard, RELP entered into a Stock Option Agreement, dated April 20, 2009, by and among RELP, DED Enterprises, CHC and CPN pursuant to which RELP has granted DED Enterprises an option (“RELP Option”) to purchase up to 570,000 shares of Common Stock at the same purchase price of $0.48 per share and a limited irrevocable proxy to, subject to the same restrictions contained in the AWS Proxy, vote any and all shares of Common Stock held by RELP. Neither the RELP Option nor the RELP Proxy provides RELP with the right to designate a director nominee to the Issuer’s board of directors.

The above description of the arrangements and relationships established under the AWS Option and the AWS Proxy should in no way be considered to be an affirmation or an admission by the Reporting Persons of the existence of any group as it relates to AWS or the shares of Common Stock owned by it for purposes of Section 13(d)(3) or Section 13(g)(3) of the Securities Exchange Act of 1934 (the ‘Exchange Act”), or Rule 13d-5(b)(1) promulgated thereunder. Descriptions of the AWS Option and the AWS Proxy throughout this Schedule 13D are qualified in their entirety by reference to the Option included as Exhibit 99.1 to this Schedule 13D and the Proxy included as Exhibit 99.2 to this Schedule 13D, respectively. These agreements are incorporated into this Schedule 13D where such references and descriptions appear.

Except as described in this Schedule 13D, none of the Reporting Persons has any plans or proposals which relate to or would result in: (i) the acquisition by any person of additional securities of the Company, or the disposition of securities of the Company; (ii) an extraordinary corporate transaction, such as a merger, organization or liquidation, involving the Company or any of its subsidiaries; (iii) a sale or transfer of a material amount of assets of the Company or any of its subsidiaries; (iv) change in the present board of directors or the management of the Company; (v) any material change in the present capitalization or dividend policy of the Company; (vi) any other material change in the Company’s business or corporate structure; (vii) changes in the Company’s charter, bylaws or instruments corresponding thereto or other actions which may impede the acquisition of control of the Company by any person; (viii) causing a class of securities of the Company to be delisted from a national securities exchange or to cease to be authorized to be quoted in an inter-dealer quotation system of a registered national securities association; (ix) a class of equity securities of the Company becoming eligible for termination of registration pursuant to Section 12(g)(4) of the Exchange Act; or (x) any action similar to any of those enumerated above.

AWS continually analyses its investment in the Issuer and reserves the right to change its intentions with respect to any of the foregoing.

Item 5.

Interest in Securities of Issuer

(a) AWS beneficially owns 1,494,933 shares of Common Stock, representing approximately 2.82% of the outstanding Common Stock of the Issuer (based on the Issuer’s definitive proxy statement filed with the Securities and Exchange Commission on April 2, 2009).

Page 7 of 10 Pages

Because of the shared rights to vote the equity securities of the Issuer under the terms of the AWS Proxy and the right under the AWS Option, in certain circumstances, to designate a director nominee that the Acquirers must vote in favor of, AWS may be deemed to be part of a group under the Exchange Act with DED Enterprises and the other Acquirers, which group, due to its voting power, collectively has beneficial ownership over 15,097,333 shares of Common Stock, or 28.51% of the outstanding Common Stock.

By virtue of their direct control over AWS and RELP, each of the General Partners may be deemed to have indirect beneficial ownership over the 1,494,933 shares of Common Stock held by AWS and the 570,000 shares of Common Stock held by RELP. Further, because of the shared rights to vote the equity securities of the Issuer under both the AWS Proxy and the RELP Proxy, and the potential right to designate a director nominee to Issuer’s board of directors under the AWS Option, each of the General Partners may be deemed to be part of a group under the Exchange Act with the other Acquirers, which group, due to its voting power, collectively has beneficial ownership over 15,097,333 shares of Common Stock, or 28.51% of the outstanding Common Stock.

In addition to the foregoing, Mr. Frohman owns 15,000 shares which are held by him for his personal account and which are not subject to any of the agreements described herein.

Each of the Reporting Persons disclaims any beneficial ownership of the shares other than those that are subject to the provisions of the AWS Option and the AWS Proxy (and, in the case of the General Partner, the shares subject to the RELP Option and the RELP Proxy), and nothing herein shall be deemed to be an admission of any of the Reporting Persons that any of them is the beneficial owner of any shares which are otherwise beneficially owned by the Acquirers, their affiliates, and any other persons with which they have arrangements with respect to the Common Stock.

(b) AWS has shared voting power (with respect to only those matters referenced in Item 4 to this Schedule 13D) and shared dispositive power with respect to 1,494,933 shares that its holds as the record owner. By virtue of the AWS Option and the AWS Proxy, AWS does not have sole voting or dispositive power over any shares of Common Stock.

Each of the General Partners, by virtue of their control positions with AWS and RELP, has shared voting power (with respect to only those matters referenced in Item 4 to this Schedule 13D) and shared dispositive power with respect to 2,064,933 shares that AWS and RELP collectively hold as the record owners. Because of the terms and conditions of the AWS Option, the AWS Proxy, the RELP Proxy and the RELP Option, none of the General Partners have sole voting or dispositive power over the shares of Common Stock owned by RELP or AWS.

In addition to the foregoing, Mr. Frohman beneficially owns 15,000 shares which are held by him for his personal account and which are not subject to any of the agreements described herein.

Other than as described herein, none of the Reporting Persons has the right to vote or dispose of any shares of Common Stock.

(c) Other than as described in this Schedule 13D, none of the Reporting Persons has effected any transaction in the Common Stock during the past 60 days.

(d) AWS shares the right to a portion of the proceeds from the sale of the Optioned Shares pursuant to the terms of the Option.

(e) Not applicable.

Page 8 of 10 Pages

Item 6.

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

See “Item 4. Purpose of the Transaction” for a summary description of the AWS Option and the AWS Proxy, which descriptions are qualified in their entirety by reference to the respective agreements which are filed as exhibits hereto. A copy of the AWS Option is filed as Exhibit 99.1 attached hereto and the AWS Proxy is filed as Exhibit 99.2 attached hereto, and each of such documents is incorporated by reference to this Item 6.

Based solely on the Amendment No. 1 to Schedule 13D filed by DED Enterprises, CHC and CPN with the Securities and Exchange Commission on April 22, 2009, it is AWS’s understanding that the Acquirers have entered into a series of agreements with Ronald D. Ordway and affiliated entities (“Ordway”) pursuant to which Ordway (i) sold 2 million shares of Common Stock to CHC and CPN, (ii) granted an option to sell up to 11,032,400 shares of Common Stock to the Acquirers at $0.48 per share, and (iii) granted an irrevocable proxy to DED Enterprises to vote any and all shares of Common Stock held by Ordway. The terms and conditions of such option and proxy are set forth in greater detail in the above-referenced Amendment No. 1 to the Schedule 13D of the Acquirer. Neither AWS nor any of the General Partners were involved in the negotiation or execution of these agreements and do not assume or accept any responsibility for the accuracy of the disclosures contained in any of the filings made under the Securities and Exchange Commission by any of the Acquirers.

Other than the AWS Option, the AWS Proxy, the RELP Proxy, and the RELP Option, none of the Reporting Person is aware of any contract, arrangement, understanding, or relationship (legal or otherwise) with any person with respect to the securities of the Issuer required to be described herein.

Item 7.

Material to Be Filed as Exhibits

The following documents are incorporated by reference as exhibits:


99.1		Stock Option Agreement, dated as of April 20, 2009, by and between Alan W. Steinberg Limited Partnership, DED Enterprises, Inc., Carpathian Holding Company, Ltd.; Nevis, and Carpathian Resources, Ltd.: Australia.

99.2		Limited Irrevocable Proxy, dated April 20, 2009, of Alan W. Steinberg Limited Partnership provided to DED Enterprises, Inc.

Page 9 of 10 Pages

Signature

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


Dated: April 29, 2009	ALAN W. STEINBERG LIMITED PARTNERSHIP

	By:	/s/ Gary J. Frohman
		Gary J. Frohman,
		General Partner

		/s/ Gary J. Frohman
		Gary J. Frohman individually and as general partner of Riviera-Enid Limited Partnership

		/s/ Alan W. Steinberg
		Alan W. Steinberg individually and as general partner of Riviera-Enid Limited Partnership

		/s/ Thomas M. Yehle
		Thomas M. Yehle individually and as general partner of Riviera-Enid Limited Partnership

Page 10 of 10 Pages

INDEX TO EXHIBITS


Exhibit Number		Description of Exhibits
99.1		Stock Option Agreement, dated as of April 20, 2009, by and between Alan W. Steinberg Partnership, DED Enterprises, Inc., Carpathian Holding Company, Ltd.; Nevis, and Carpathian Resources, Ltd.: Australia.

99.2		Limited Irrevocable Proxy, dated April 20, 2009, of Alan W. Steinberg Limited Partnership provided to DED Enterprises, Inc.

EX-99.1 2 dex991.htm STOCK OPTION AGREEMENT Stock Option Agreement

Exhibit 99.1

STOCK OPTION AGREEMENT

THIS AGREEMENT made as of this 20^th day of April, 2009 between The Alan W. Steinberg Limited Partnership, a New York limited partnership, with its principal address at 1501 Venera Avenue, Suite 205, Coral Gables, FL 33146 (the “Optionor”), DED Enterprises Inc., a Florida corporation, with its principal address at 210 Crystal Grove Blvd., Lutz, FL 33548 (the “Optionee”), Carpathian Holding Company, Ltd: Nevis (“CHC”), and Carpathian Resources, Ltd: Australia (“CPN”).

W H E R E A S :

(A)

The Optionor is the legal and/or beneficial owner of 1,494,933 shares (the “Optionor’s Shares”) of the common stock of MDU Communications International, Inc., a Delaware corporation (the “Corporation”); and

(B)

The Optionor wishes to grant to the Optionee under the terms and conditions contained herein, and the Optionee wishes to accept from the Optionor, an option to purchase up to the entirety of the Optionor’s Shares (the “Optioned Shares”).

NOW, THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Optionor hereby grants to the Optionee an option (the “Option”) to purchase the Optioned Shares at a purchase price (the “Purchase Price”) of forty-eight U.S. cents (US$0.48) per share, upon and subject to the following terms and conditions:

1. Option Exercise Period. The Option may be exercised by the Optionee, in whole or in part (but in no case in tranches of less than 100,000 shares), at any time from the date hereof until March 9, 2012 (the “Termination Date”) and shall terminate on the Termination Date unless exercised by the Optionee prior thereto.

2. Exercise of Option. The Optionee shall, for the purposes of exercising the Option, give to the Optionor written notice (the “Exercise Notice”) thereof along with payment thereof in immediately available funds by a bank check or a wire transfer payable to the Optionor, in the amount of the Purchase Price.

3. Transfer of Optioned Shares. Upon compliance by the Optionee of all of the terms and conditions of this Agreement and upon receipt by the Optionor of (i) the Exercise Notice, and (ii) the Purchase Price, the Optionor shall sell and transfer to the Optionee the Optioned Shares and as evidence thereof, the Optionor shall execute in favor of the Optionee a form of transfer and an endorsement on the share certificates representing the Optioned Shares, together with such other documents to evidence the sale and transfer as the Optionee reasonably requests. Optionor hereby warrants that Optionor has the right to transfer the Optioned Shares to the Optionee, and that Optionor will retain that right throughout the term of this Agreement.

4. Assignability of Option. The Optionee may sell, assign or otherwise transfer the Option or any of its rights under this Agreement to any Affiliate in the Optionee’s discretion. In the event that the Optioned Shares are transferred from the Optionor by operation of law (e.g., by dissolution or levy) or transferred to an Affiliate of the Optionor prior to the Termination Date, such transfer of the Optioned Shares shall be subject to the terms of this Option.

5. Profit Participation. In consideration for the Option, upon each sale of the Optioned Shares by the Optionee (or its Affiliate, as defined below) to a Person which is not an Affiliate of the Optionee, (each such sale referred to herein as a “Final Sale”), the Optionee shall pay to the Optionor an amount equal to 50% of the difference between the amount realized in the Final Sale (the aggregate sales price less any commissions payable as a result of the Final Sale to a Person who is not an Affiliate of the Optionee) and the aggregate Purchase Price. The Optionee (or its Affiliate) shall determine, in its sole discretion whether, when, and at what price, to sell the Optioned Shares; provided however, Optionee shall consult with Optionor, with respect to any prospective sale of the Optioned Shares prior to such sale. Further provided, Optionee shall give Optionor prompt notice (next business day) of such Final Sale, and shall promptly remit (one day following Optionee’s receipt of sale proceeds) the amount of the sales proceeds due Optionor by virtue of any such Final Sale, along with a detailed written accounting therefor which shows in reasonable detail all calculations used to determine the amount due to Optionor.

6. Optionee’s Right of First Refusal. Prior to the exercise of the Option, before any Optioned Shares held by the Optionor or any transferee of the Optionor (either being sometimes referred to herein as the “Selling Stockholder”) may be sold or otherwise transferred, the Optionee or its assignee(s) shall have a right of first refusal to acquire the Optioned Shares on the terms and conditions set forth in this Section (the “Right of First Refusal”).

(a) The Selling Stockholder shall (a) deliver to the Optionee a written notice (the “Notice”) stating: (i) the Selling Stockholder’s bona fide intention to sell or otherwise transfer such Optioned Shares; (ii) the name of each proposed purchaser or other transferee (“Proposed Transferee”); (iii) the number of Optioned Shares to be transferred to each Proposed Transferee; (iv) the amount of the bona fide cash price or other consideration for which the Selling Stockholder proposes to transfer the Optioned Shares (the “Offered Price”); and (v) the material terms and conditions of the proposed transfer (the “Offer Terms”) and (b) offer the Optioned Shares at the Offered Price and on the Offer Terms to the Optionee or its assignee(s).

(b) Within one business day after receipt of the Notice, the Optionee and/or its assignee(s) may, by giving written notice to the Selling Stockholder, elect to purchase all, but not less than all, of the Optioned Shares proposed to be transferred to any one or more of the Proposed Transferees, at the purchase price and on the terms determined in accordance with subsection (c) below.

(c) The purchase price for the Optioned Shares purchased by the Optionee or its assignee(s) under this Section 6 shall be the Offered Price, and the terms and conditions of the transfer shall be identical in all material respects to the Offer Terms (the “Terms”). If the Offered Price includes consideration other than cash, the cash equivalent value of the non-cash consideration shall be determined by the Board of Directors of the Corporation in good faith and such determination shall be final and binding upon the parties.

(d) Payment of the purchase price under this Section 6 shall be made in cash, immediately available funds by a bank check or wire transfer of funds, in any case in accordance with the Terms.

(e) If all of the Optioned Shares proposed in the Notice to be transferred to a given Proposed Transferee are not purchased by the Optionee and/or its assignee(s) as provided in this Section, then the Selling Stockholder may sell or otherwise transfer such Optioned Shares to the Proposed Transferee at the Offered Price or at a higher price and on the Offer Terms (each such sale referred to herein as an “Optionor Sale”), provided that such Optionor Sale or other transfer is consummated within 60 days following such Notice, and in such event, Optionor shall promptly pay the Optionee an amount equal to 50% of the following: (i) the total number of shares sold pursuant to such Option Sale multiplied by (ii) the number resulting from (y) forty-eight U.S. cents (US$0.48) per share minus (z) the net sales price (sales price per share less any commissions paid to third parties) per share. If the net sales price does not exceed $0.48 per share, then no amounts will be payable to the Optionee hereunder. If the Optioned Shares described in the Notice are not transferred to the proposed Transferee within such period, a new Notice shall be given to the Optionee, and the Optionee and/or its assignees shall again be offered the Right of First Refusal before any Optioned Shares held by the Selling Stockholder may be sold or otherwise transferred.

7. Accounting and Access to Records. The Optionee shall maintain complete, clear and accurate records in sufficient detail to enable the amounts payable hereunder to be determined. The Optionor shall be entitled to reasonable access to such records for the purpose of inspection and copying. Specifically, such records shall be open to inspection by the Optionor and subject to an annual audit and periodic reproduction by its agents or representatives for the purpose of verifying their accuracy during normal business hours and upon reasonable prior notice (as well as reasonable access to the accountants, attorneys and others who have prepared or maintained such records). If such annual audit reveals any errors or inaccuracies in any amounts paid or due to be paid by the Optionee to the Optionor hereunder, then such amount shall be promptly paid. Any such audits shall be conducted at the Optionor’s expense, unless such audit reveals a discrepancy of 5% or greater in the amount due to the Optionor, in which case the Optionee shall be responsible for all costs and expenses in connection with such audit.

8. Board Representation. If, during the term of this Agreement, the Optionee acquires a Controlling Interest in the Corporation, the Optionor shall be entitled to designate one nominee that it desires to have elected to the board of directors (the “Board”) of the Corporation (a “Nominee”). The Optionee agrees to vote or cause to be voted (at any regular or special meeting of the shareholders of the Corporation or by written consent in lieu of any such meeting) all shares of voting stock of the Corporation over which it has, directly or indirectly through the ownership of the shares or otherwise, voting power (whether owned as of the date hereof or hereafter acquired) or over which it has, directly or indirectly through an agreement, contract, arrangement or otherwise, the right to direct the voting of such shares (whether such agreement, contract, arrangement or otherwise exists as of the date hereof or hereafter made) in favor of, or otherwise consent to, the election of such Nominee to the Board. If any Nominee is unable or unwilling to serve upon his or her election to the Board, the Optionor shall be entitled to nominate a replacement who shall then be a Nominee for the purposes of this Agreement. If, following election to the Board, any Nominee shall resign or be removed for any reason (with or without cause) or be unable to serve by reason of death or disability, the Optionor shall within 30 days of such event, notify the Optionee in writing of a replacement, and the Optionee shall take such steps as may be necessary to elect such replacement to the Board to fill the unexpired term of the Nominee.

9. Entire Agreement. This Agreement, along with the proxy of even date given by Optionor to Optionee, expresses the entire agreement between the parties concerning the subject matter hereof and supersedes all previous agreements, whether written or oral, between the parties respecting the subject matter hereof.

10. Successors and Assigns. This Agreement shall be binding upon the parties hereto and their respective heirs, executors, administrators and successors and permitted assigns.

11. Notices. Notice under this agreement shall be in writing and shall be given by facsimile transmission (with copy sent by overnight courier), or electronically in portable document format (PDF) (with copy sent via facsimile transmission). Notice shall be deemed given when it is received by the recipient of the notice. Notices to the parties shall be as follows:

If to Optionee, CHC or CPN:

DED Enterprises, Inc.

210 Crystal Grove Blvd.

Lutz, FL 33548

Fax: (800) 967-7340

e-mail address: mail@davidhammeresq.com

If to Optionor:

Alan W. Steinberg Partnership

1501 Venera Avenue

Suite 205

Coral Gables, FL 33146

e-mail address: gary@awslp.com

12. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Florida.

13. Litigation. If any legal action is brought for the enforcement of this Agreement, or because of an alleged dispute, breach, default, or misrepresentation in connection with any of the provisions of this Agreement, the successful or prevailing party or parties shall be entitled to recover reasonable attorney fees, paralegal fees and other costs incurred in that action or proceeding, in addition to any other relief to which it or they may be entitled. Any such legal action shall be brought exclusively in courts of competent jurisdiction in Miami-Dade County, Florida.

14. Indemnification.

(a) The Optionee, CHC, CPN, and their Affiliates (the “Indemnifying Parties”) each agree, jointly or severally, to indemnify and hold the Optionor, its shareholders, officers, directors, employees agents and representatives (each an “Indemnified Party”) harmless against any and all losses, claims, damages, expenses, liabilities, or actions in respect thereof of any nature whatsoever (“Claims”), whenever or wherever brought, directly or indirectly, to which any Indemnified Party may become subject under the Securities Act of 1933, the Securities Exchange Act of 1934, the securities laws of any other jurisdiction, the rules and regulations promulgated thereunder, or other federal or state statutory laws or regulations, at common law or otherwise (including payments made in settlement of any litigation), insofar as such Claims arise out of or in connection with or are based upon: (a) any breach by the Optionee of any representation or warranty contained in this Agreement, (b) the failure of any of the Optionee to observe, perform or abide by, or any other breach of, any restriction, covenant, obligation or other provision contained this Agreement, (c) any untrue statement or alleged untrue statement of any material fact contained in a filing made with the Securities and Exchange Commission by or on behalf of any of the Indemnifying Parties or their respective associates or in any filing or document of any Indemnified Party based upon information furnished to it by the Indemnifying Parties or associates, or arise out of or are based upon the omission or alleged omission to state in any of the foregoing a material fact required to be stated therein or necessary to make the statements therein not misleading, and (d) any action brought by virtue of or arising from any Indemnified Party being deemed to be a member of a “group” for purposes of the federal securities law.

(b) This indemnification will include any and all losses, liabilities, damages, demands, claims, suits, actions, judgments, costs and expenses, including, without limitation, interest, penalties, reasonable attorneys’ fees, and any and all reasonable costs and expenses incurred in investigating, preparing or defending against any litigation, commenced or threatened, any civil, criminal, administrative or arbitration action, or any claim whatsoever, and any and all amounts paid in settlement of any claim or litigation asserted against, resulting, imposed upon, or incurred or suffered by any Indemnified Party (each, a “Loss”).

(c) In the event of a claim against any Indemnified Party pursuant to the prior paragraph or the occurrence of a Loss, such Indemnified Party shall give the Optionee prompt written notice of such claim or Loss (provided that failure to promptly notify the Optionee shall not relieve any of the Indemnifying Parties from any liability which it or they may have on account of this Agreement, except to the extent that the Optionee shall have been materially prejudiced by such failure). Upon receipt of such written notice, the Optionee shall provide the Indemnified Party with counsel to represent it. Such counsel shall be reasonably acceptable to the Indemnified Party. In addition, the Indemnified Party will be reimbursed promptly for all Losses suffered by it as incurred as provided herein. None of the Indemnifying Parties may enter into any settlement of any Loss or claim without the Indemnified Party’s prior written consent unless such settlement includes a full release of the Indemnified Party from any and all liability in respect of such claim.

15. Counterparts. This Agreement may be executed in any number of counterparts, each of which, when executed and delivered, shall be an original, but all counterparts shall together constitute one and the same instrument.

16. Authority. Each party warrants that this Agreement has been duly authorized, executed and delivered by an authorized officer or representative of such party and is enforceable in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting creditors’ rights generally or by general equitable principles.

17. Definitions.

(a) “Affiliate” means, with respect to any specified Person, any of the following: any Person beneficially owned or Controlled by, or under common beneficial ownership or Control with, the specified Person, or any officer, director, equity owner (of greater than or equal to twenty percent (20%)), or partner of the specified Person. The purpose of this definition is to exclude transactions at less than arms’ length from triggering, or changing the substance of, the terms of this Option.

(b) “Control” (including, with correlative meanings, the terms “Controlling,” “Controlling Interest,” “Controlled by” and “under common Control with”), as applied to any Person, shall mean the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of such Person, whether through the beneficial ownership of voting securities (whether sole or shared) or other ownership interest, by contract or otherwise.

(c) “Person” means any individual, partnership, firm, corporation, limited liability company, association, trust, unincorporated organization or other entity.

[SIGNATURE PAGES FOLLOW]

IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the date first above written.


	The Alan W. Steinberg Limited Partnership

/s/ Carol Albanese	By:	/s/ Gary Frohman
Witness		Gary Frohman, General Partner



	DED Enterprises Inc.

/s/ Louis Scholl	By:	/s/ David E. Hammer
Witness		David E. Hammer, President



	Carpathian Holding Company, Ltd: Nevis

/s/ Kelly Ziff	By:	/s/ James Wiberg
Witness		James Wiberg, Director



	Carpathian Resources, Ltd: Australia

/s/ Louis Scholl	By:	/s/ David E. Hammer
Witness		David E. Hammer, Executive Director

EX-99.2 3 dex992.htm LIMITED IRREVOCABLE PROXY Limited Irrevocable Proxy

Exhibit 99.2

LIMITED IRREVOCABLE PROXY

BE IT KNOWN, that the undersigned, as a general partner of The Alan W. Steinberg Limited Partnership, a New York limited partnership, with its principal business office located at 1501 Venera Avenue, Suite 205, Coral Gables, Florida 33146 (the “Partnership”), holder of shares of common stock, $0.001 par value per share (the “Common Stock”), of MDU Communications International, Inc., a Delaware corporation, with its principal executive offices located at 60-D Commerce Way, Totowa, New Jersey 07512 (the “Corporation”), does hereby constitute and appoint DED Enterprises Inc., a Florida corporation, with its principal address at 210 Crystal, Grove Blvd, Lutz, FL 33548, and any of its officers, directors or authorized representatives (referred to collectively herein a the “Proxy Holder”), as the Partnership’s true and lawful attorney of fact (who shall have full power of substitution) to represent and vote, except as provided below, all of the shares of Common Stock of the Corporation that the undersigned holds of record (“Partnership Shares”) at any meeting of the stockholders of the Corporation, however called (each, a “Stockholders’ Meeting”).

Notwithstanding the foregoing, the Proxy Holder shall not have the power or authority to cause the Partnership Shares to be counted as present at any such Stockholders’ Meeting or to vote or cause to be voted at a Stockholders’ Meeting or to execute or cause to be executed any written consent in respect of such Partnership’s Shares in connection with any of the following actions: (a) any amendment, restatement or modification of the Certificate of Incorporation, Bylaws or other corporate governance documents of the Corporation, other than an amendment, restatement, or modification fixing the size of the board of directors of the Corporation, (b) any action which is reasonably likely to have an adverse effect on the rights of the holders of Common Stock; (c) the creation or authorization, or issuance, of additional shares of the Common Stock or any securities of the Corporation ranking senior to, or on a parity with, the Common Stock as to the payment of dividends or the distribution of assets upon a Liquidation Event (“Senior Securities”), including the creation, authorization, or issuance of options, warrants or other rights providing for the issuance of any shares of Common Stock or any such Senior Securities; (d) any alteration or change to the rights, preferences or privileges of any Senior Securities which may adversely affect the Common Stock; (e) approval of any Covered Transaction; (f) providing for the redemption, retirement, purchase or other acquisition, directly or indirectly, through subsidiaries or otherwise, any of the shares of Common Stock, (g) approval of any stock splits, reverse stock splits, or (g) approval of any Liquidation Event.

As used herein, a “Liquidation Event” shall mean any of the following transactions involving the Corporation: (i) reorganization, reclassification, merger, consolidation, business combination, or other form of similar corporate transaction or series of transactions involving the Corporation, (ii) liquidation, dissolution or winding up of the affairs of the Corporation, (iii) sale, lease or exchange, transfer, exclusive license or other disposition of all or substantially all of the assets or intellectual property of the Corporation, or (iv) any other transaction or a series of related transactions resulting in a change of control of the Corporation (other than by the election of directors by the Proxy Holder). Further, as used herein, a “Covered Transaction” shall mean any transaction in which the Corporation (or any affiliate thereof) is a participant and a Related Person will have a direct or indirect material interest and where the amount involved exceeds $50,000.00. As used herein, a “Related Person” includes (w) the Proxy Holder, Carpathian

Holding Corporation, Ltd: Nevis, Carpathian Resources, Ltd: Australia and any of their officers, directors, shareholders, affiliates and associates (“affiliates” and “associates” as defined under Rule 12b-2 promulgated under the Securities Exchange Act of 1934, as amended) (x) any director or officer of the Corporation, (y) any security holder of the Corporation having sole or shared beneficial ownership of more than 5% of any class of the Corporation’s securities, and (z) any immediate family member or affiliate of any of the foregoing persons.

The provisions of Sections 9, 10, 11, 13 and 14 of that certain Stock Option Agreement of even date herewith by and among the Partnership, the Proxy Holder, Carpathian Holding Company, Ltd: Nevis, and Carpathian Resources, Ltd: Australia shall be incorporated by reference as though such provisions were made in reference to this proxy agreement and shall be enforceable on each of the parties hereto.

The undersigned herewith revokes any other proxy heretofore given. This Proxy may be revoked and terminated by the Partnership with respect to any shares of Common Stock (otherwise subject to this proxy) which may have been sold or transferred by the Partnership to a third-party(ies). Except as specifically provided herein, this proxy is irrevocable and is coupled with an interest, and it shall expire one year from the date hereof.

[SIGNATURE PAGE FOLLOWS]

WITNESS the undersigned’s hand and seal this 20^th day of April, 2009.


The Alan W. Steinberg Limited Partnership

By:		/s/ Gary Frohman
		Gary Frohman, General Partner

		/s/ Carol Albanese
		Name of Witness: Carol Albanese

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