exv4w54



 





Exhibit 4.54




Dated the 26th day of February 2008




NAM TAI ELECTRONICS, INC.

as the Vendor




and




HKC (HOLDINGS) LIMITED

as the Purchaser




 



AGREEMENT FOR THE

SALE AND PURCHASE OF SHARES

IN

J.I.C. TECHNOLOGY COMPANY LIMITED

 






Baker
& McKenzie

14th Floor Hutchison House

10 Harcourt Road

Hong Kong




Telephone: (852) 2846-1888

Fax: (852) 2845-0476

Ref: LKL/RCC




 









 





CONTENTS




	 	 	 	 	 	 	 
	Clause	 	Heading	 	Page	 
	 
	 	 	 	 	 	 
	1.
	 	Definitions and Interpretation	 	 	1	 
	 
	 	 	 	 	 	 
	2.
	 	Sale and Purchase of the Sale Shares	 	 	7	 
	 
	 	 	 	 	 	 
	3.
	 	Purchase Price	 	 	7	 
	 
	 	 	 	 	 	 
	4.
	 	Conditions	 	 	7	 
	 
	 	 	 	 	 	 
	5.
	 	General Offer	 	 	8	 
	 
	 	 	 	 	 	 
	6.
	 	Completion	 	 	8	 
	 
	 	 	 	 	 	 
	7.
	 	Further Undertakings	 	 	12	 
	 
	 	 	 	 	 	 
	8.
	 	Warranties	 	 	15	 
	 
	 	 	 	 	 	 
	9.
	 	Restriction on Announcements and Disclosure	 	 	18	 
	 
	 	 	 	 	 	 
	10.
	 	Access to Information	 	 	19	 
	 
	 	 	 	 	 	 
	11.
	 	Restriction of Vendor	 	 	19	 
	 
	 	 	 	 	 	 
	12.
	 	Miscellaneous	 	 	20	 
	 
	 	 	 	 	 	 
	13.
	 	Governing Law and Jurisdiction	 	 	21	 
	 
	 	 	 	 	 	 
	SCHEDULE 1 — PART A: Particulars of the Company	 	 	22	 
	 
	 	 	 	 	 	 
	SCHEDULE 1 — PART B: Particulars of the Subsidiaries	 	 	23	 
	 
	 	 	 	 	 	 
	SCHEDULE 2: Warranties	 	 	29	 
	 
	 	 	 	 	 	 
	SCHEDULE 3: Deed of Indemnity	 	 	44	 
	 
	 	 	 	 	 	 
	SCHEDULE 4: Letter of Resignation under Seal	 	 	53	 
	 
	 	 	 	 	 	 
	SCHEDULE 5: Agreements and arrangements relating to the
employees or the affairs of the Group as referred to in
paragraph 17 of Schedule 2
	 	 	54	 






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THIS AGREEMENT is made on the 26th day of February 2008




BETWEEN:





	(1)	 	NAM TAI ELECTRONICS, INC., a company incorporated in the British Virgin Islands, whose
registered office is at McNamara Chambers, P.O. Box 3342, Road Town, Tortola, British Virgin
Islands (the “Vendor”); and
	 
	(2)	 	HKC (HOLDINGS) LIMITED, a company incorporated in Bermuda, whose registered office is at
Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda (the “Purchaser”).





WHEREAS:





	(A)	 	The Company is a company incorporated in the Cayman Islands with limited liability and
registered as an oversea company under Part XI of the Companies Ordinance. The Company’s
shares are listed on the Stock Exchange.
	 
	(B)	 	The Vendor as beneficial owner has agreed to sell, and the Purchaser has agreed to purchase,
the Sale Shares beneficially owned as at the date hereof by the Vendor, representing
approximately 74.99% of the total issued share capital of the Company upon the terms and
conditions hereinafter set out.





THE PARTIES AGREE THAT:





	1.	 	Definitions and Interpretation
	 
	1.1	 	In this Agreement, where the context so admits the following words and expressions shall have
the following meanings:





	 	 	 
	“Accounting Date”

	 	31 December 2007;
	 
	 	 
	“Accounts”

	 	the audited financial statements of the Company and
of each of the Subsidiaries for the accounting
period which ended on the Accounting Date (each such
financial statement comprising a balance sheet as at
the Accounting Date, profit and loss account, notes
and directors’ and auditors’ report) and the
consolidated profit and loss account and
consolidated balance sheet of the Company as at and
for the period ending on the Accounting Date;
	 
	 	 
	“Agreement”

	 	this agreement as amended or varied from time to
time in accordance with the terms hereof;
	 
	 	 
	“associate”

	 	the same meaning as defined in the Listing Rules;






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	“business day”

	 	a day (other than Saturday) on which banks in Hong
Kong are open for business;
	 
	 	 
	“CCASS”

	 	the Central Clearing and Settlement System
established and operated by Hong Kong Securities
Clearing Company Limited;
	 
	 	 
	“Companies Ordinance”

	 	the Companies Ordinance (Chapter 32 of the Laws of
Hong Kong);
	 
	 	 
	“Company”

	 	J.I.C. Technology Company Limited, particulars of
which being set out in Part A of Schedule 1;
	 
	 	 
	“company”

	 	any company or body corporate wherever incorporated;
	 
	 	 
	“Completion”

	 	completion of the sale and purchase of the Sale
Shares as specified in Clause 6;
	 
	 	 
	“Completion Date”

	 	the earliest of the following:-
	 
	 	 
	 

	 	(a) subject to (b) and (c) below, the next business
day after the day on which the joint
announcement of the Purchaser and the Company
in relation to this Agreement and the General
Offer has been approved by the SFC and the
Stock Exchange (which shall be no later than
the Latest Announcement Date);

	 
	 	 
	 

	 	(b) where the performance of this Agreement and the
transactions contemplated herein by the
Purchaser requires approval from the
Purchaser’s shareholders and there is no
indication from the Stock Exchange that the
waiver from convening the related Purchaser’s
general meeting under Chapter 14 of the Listing
Rules cannot be granted, the business day upon
which the relevant written shareholders’
approval for the Purchaser permitted under the
Listing Rules being obtained (which shall be no
later than the Latest Announcement Date); and

	 
	 	 
	 

	 	(c) if and only if the performance of this
Agreement and the transactions contemplated
herein by the Purchaser requires to be approved
by Purchaser’s







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	 	shareholders in a general meeting as required
by the Stock Exchange (which cannot be
waived), the next business day after approval
of the Purchaser’s shareholders at the
Purchaser’s general meeting for such purpose
(which shall be no later than the Latest
Approval Date),

	 
	 	 
	 

	 	in each case subject to any other date as the
Parties may agree in writing;
	 
	 	 
	“Deed of Indemnity”

	 	the deed in the form set out in Schedule 3;
	 
	 	 
	“Disclosure Letter”

	 	the letter from the Vendor to the Purchaser dated the
date of this Agreement in the approved terms;
	 
	 	 
	“Earnest Money”

	 	an amount of HK$1,000,000 paid by HKE to the Vendor pursuant to the
Exclusivity Agreement;
	 
	 	 
	“Exclusivity Agreement”

	 	an exclusivity agreement made between the Vendor and HKE dated 6
February 2008;
	 
	 	 
	“General Offer”

	 	the cash offer to be made by or on behalf of the Purchaser
in accordance with the Takeovers Code for the Offer Shares
following and subject to Completion;
	 
	 	 
	“Group”

	 	the group of companies consisting of the Company and the
Subsidiaries and the expression “member of the Group”
shall be construed accordingly;
	 
	 	 
	“HK$”

	 	Hong Kong dollars;
	 
	 	 
	“HKE”

	 	Hong Kong Energy (Holdings) Limited, a wholly-owned subsidiary of the
Purchaser;
	 
	 	 
	“Hong Kong”

	 	the Hong Kong Special Administrative Region
of the People’s Republic of China;
	 
	 	 
	“Intellectual Property Rights”

	 	includes patents, knowhow, trade secrets
and other confidential information,
registered or unregistered designs,
copyrights, performer’s rights, Internet
domain names of any level, plant variety
rights, design rights, rights in circuit
layouts, topography rights, trade marks,
service marks, business names,
registrations of, applications to register
and rights to apply for registration of any
of the aforesaid items, rights






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	 	in the nature of any of the aforesaid items in any
country, rights in the nature of unfair competition
rights, rights to sue for passing off, moral rights
and other registerable or unregisterable
intellectual property rights;
	 
	 	 
	“Latest Announcement Date”

	 	11 March 2008, being the fourteen (14th) day
immediately after the signing date of this
Agreement;
	 
	 	 
	“Latest Approval Date”

	 	26 May 2008;
	 
	 	 
	“Leased Properties”

	 	all the land, buildings and premises currently
leased by the Group;
	 
	 	 
	“Listing Rules”

	 	at any given time, the Rules Governing the
Listing of Securities on The Stock Exchange of
Hong Kong Limited in force at that time;
	 
	 	 
	“Offer Shares”

	 	the existing issued Shares but excluding the
Sale Shares and any other Shares owned by the
Purchaser and persons acting in concert (within
the meaning of the Takeovers Code) with it on
the Completion Date and/or acquired or agreed
to be acquired by the Purchaser and persons
acting in concert with it while the General
Offer remains open for acceptance;
	 
	 	 
	“Parties”

	 	the named Parties to this Agreement and “Party”
means any one of them;
	 
	 	 
	“Purchase Price”

	 	the purchase price payable by the Purchaser for
the Sale Shares as specified in Clause 3.1;
	 
	 	 
	“Sale Shares”

	 	the 572,594,978 ordinary shares of HK$0.01 each
in the capital of the Company to be bought and
sold pursuant to Clause 2, being all the issued
shares in the capital of the Company
beneficially owned by the Vendor;
	 
	 	 
	“SFC”

	 	the Executive Director for the time being of
the Corporate Finance Division of the
Securities and Futures Commission and any
delegate for the time being of the Executive
Director;
	 
	 	 
	“Share Option Scheme”

	 	the share option scheme adopted by the Company
on 31 May 2002;






4









 






	 	 	 
	 
	 	 
	“Shares”

	 	the ordinary shares of HK$0.01 each in the
capital of the Company, and “Share” means any
of them;
	 
	 	 
	“Stock Exchange”

	 	The Stock Exchange of Hong Kong Limited;
	 
	 	 
	“Subsidiaries”

	 	the subsidiaries of the Company listed in Part
B of Schedule 1;
	 
	 	 
	“Takeovers Code”

	 	at any relevant time, the Hong Kong Code on
Takeovers and Mergers in force at that time;
	 
	 	 
	“Tax”

	 	all forms of taxation, stamp duties, estate
duties, deductions, withholdings, duties,
imposts, levies, fees, charges, social security
contributions and rates imposed, levied,
collected, withheld or assessed by any local,
municipal, regional, urban, governmental,
state, federal or other body in Hong Kong or
elsewhere and any interest, additional
taxation, penalty, surcharge or fine in
connection therewith;
	 
	 	 
	“Total Cash”

	 	cash at bank or in hand of the Group free from any encumbrance of whatsoever
nature;
	 
	 	 
	“Warranted Cash Level”

	 	HK$335 million if and only if Completion is conducted on or before
the Latest Announcement Date, provided that if any of the existing bank loan of the
Group as disclosed in the Disclosure Letter must be repaid at the request of the
relevant bank before Completion, the “Warranted Cash Level” shall be reduced by the
amount of such repayment; and
	 
	 	 
	“Warranties”

	 	the warranties, representations, indemnities and undertakings given or made by
the Vendor and contained in this Agreement (including those warranties and
representations set out in Schedule 2).







	1.2	 	Any references, express or implied, to statutes or statutory provisions shall be construed as
references to those statutes or provisions as respectively amended or re-enacted or as their
application is modified by other provisions (whether before or after the date hereof) from
time to time and shall include any statutes or provisions of which they are re-enactments
(whether with or without modification) and any orders, regulations, instruments or other
subordinate legislation under the relevant statute or statutory provision. References to
sections of consolidating legislation shall, wherever necessary or appropriate in the context,
be construed as including




5









 









	 	 	references to the sections of the previous legislation from which the consolidating
legislation has been prepared.
	 
	1.3	 	References herein to Clauses and Schedules are to clauses in and schedules to this Agreement
(unless the context requires otherwise). The Recitals and the Schedules to this Agreement
shall be deemed to form part of this Agreement.
	 
	1.4	 	The expressions the “Vendor” and the “Purchaser”, shall, where the context permits, include
their respective permitted assigns.
	 
	1.5	 	The headings are inserted for convenience only and shall not affect the construction of this
Agreement.
	 
	1.6	 	Unless the context requires otherwise, words importing the singular include the plural and
vice versa and words importing a gender include every gender.
	 
	1.7	 	References to “persons” shall include bodies corporate, unincorporated associations and
partnerships (whether or not having separate legal personality).
	 
	1.8	 	References to writing shall include any methods of producing or reproducing words in a
legible and non-transitory form.
	 
	1.9	 	A document expressed to be “in the approved terms” means a document the terms of which have
been approved by or on behalf of the Vendor and the Purchaser and a copy of which has been
signed for the purposes of identification by or on behalf of the Vendor and the Purchaser.
	 
	1.10	 	Unless the context requires otherwise, words and expressions defined in the Companies
Ordinance shall bear the same respective meanings when used in this Agreement.
	 
	1.11	 	In construing this Agreement:






	 	1.11.1	 	the rule known as the ejusdem generis rule shall not apply and, accordingly, general
words introduced by the word “other” shall not be given a restrictive meaning by reason
of the fact that they are preceded by words indicating a particular class of acts,
matters or things; and
	 
	 	1.11.2	 	general words shall not be given a restrictive meaning by reason of the fact that
they are followed by particular examples intended to be embraced by the general words.






6











 






	2.	 	Sale and Purchase of the Sale Shares
	 
	2.1	 	Subject to the terms of this Agreement, the Vendor shall sell as beneficial owner and the
Purchaser shall purchase, the Sale Shares free from all liens, charges and encumbrances and
together with all rights now or hereafter attaching to them, including all rights to any
dividend or other distribution declared, made or paid on or after the date of this Agreement.
	 
	2.2	 	The Purchaser shall not be obliged to complete the purchase of any of the Sale Shares unless
the purchase of all of the Sale Shares is completed simultaneously.
	 
	3.	 	Purchase Price
	 
	3.1	 	The total consideration payable for the Sale Shares shall be HK$397,461,067 (equivalent to
approximately HK$0.69414 per Sale Share).
	 
	3.2	 	The Parties acknowledge that pursuant to the Exclusivity Agreement, the Vendor has received
the Earnest Money from HKE. The Parties hereby agree that the Earnest Money is to be applied
as part payment of the Purchase Price at Completion, and the remaining balance of the Purchase
Price in the sum of HK$396,461,067 will be paid at Completion in accordance with Clause 6.3.1.
	 
	3.3	 	Where Completion does not occur on or before the Latest Announcement Date or such later date
as the Parties may otherwise agree in writing, the Purchaser shall pay to the Vendor in cash
within two business days after the Latest Announcement Date a deposit of HK$99,365,267 as part
of the Purchase Price.
	 
	4.	 	Conditions
	 
	4.1	 	The sale and purchase of the Sale Shares is conditional upon:






	 	4.1.1	 	the Warranties being true and accurate and not misleading in all material
respects at the date of this Agreement and having remained true and accurate and not
misleading in all material respects on the Completion Date;
	 
	 	4.1.2	 	the Vendor not having breached any of its obligations specified in Clause 7;
and
	 
	 	4.1.3	 	the current listing of the Shares not having been withdrawn, the Shares
continuing to be traded on the Stock Exchange prior to the Completion Date (save for
any temporary suspension pending any announcement in connection with this Agreement and
transactions contemplated hereunder) and the Stock Exchange and SFC not having
objected, and not having indicated that they will object, to such listing.






	4.2	 	The Purchaser may waive all or any of the conditions set out in Clause 4.1 at any time by
notice in writing to the Vendor.




7









 












	4.3	 	In the event that any of the conditions referred to in Clause 4.1 shall not have been
fulfilled (or waived pursuant to Clause 4.2) prior to 26 May 2008, then the Purchaser shall
not be bound to proceed with the purchase of the Sale Shares and this Agreement shall cease to
be of any effect except Clauses 9, 12 and 13 which shall remain in force and save in respect
of claims arising out of any antecedent breach of this Agreement. Where the Purchaser has paid
the deposit to the Vendor in accordance with Clause 3.3, the Vendor shall forthwith return the
whole of such deposit to the Purchaser in cash without any interest.
	 
	5.	 	General Offer
	 
	 	 	The Parties hereby undertake that they will each use all reasonable endeavours to
supply such information as may be reasonably necessary to be included in the documents
to be despatched or the announcements to be issued pursuant to the Takeovers Code in
connection with the General Offer.
	 
	6.	 	Completion
	 
	6.1	 	Subject to the provisions of Clause 4, Completion shall take place on the Completion Date at
the office of the Purchaser(at the request of the Purchaser) when all (but not some only) of
the events described in the other provisions of this Clause 6 shall occur.
	 
	6.2	 	At Completion, the Vendor shall:






	 	6.2.1	 	procure that its designated participant with CCASS gives an irrevocable
delivery instruction to effect a book entry settlement of 61,604,688 Shares out of the
Sale Shares in accordance with the rules and the operational procedures of CCASS to the
credit of the stock account of the Purchaser’s designated participant with CCASS in
accordance with the details provided by the Purchaser to the Vendor prior to
Completion;
	 
	 	6.2.2	 	deliver or cause to be delivered to the Purchaser:






	 	6.2.2.1	 	evidence of the giving of the delivery instruction referred to in Clause
6.2.1 above together with sold note(s) in respect of such amount of Sale Shares
duly executed by or on behalf of the Vendor;
	 
	 	6.2.2.2	 	duly executed transfers and sold notes in respect of 510,990,290 Shares out
of the Sale Shares in favour of the Purchaser or its nominee(s) together with
the relative share certificates;
	 
	 	6.2.2.3	 	a cheque for HK$397,462 (being an estimate only of the Vendor’s share of
stamp duty payable in respect of the transfer of the Sale Shares) drawn in
favour of the Government of the Hong Kong Special Administrative Region;




8









 












	 	6.2.2.4	 	all powers of attorney or other authorities under which sold notes (if
applicable) in respect of the Sale Shares have been executed;
	 
	 	6.2.2.5	 	the Deed of Indemnity duly executed by the Vendor;
	 
	 	6.2.2.6	 	all the statutory and other books and records (including financial records)
duly written up to date of each member of the Group and their respective
certificates of incorporation, current business registration certificates and
common seals and any other papers, records and documents of each member of the
Group to the extent within the possession of the Vendor;
	 
	 	6.2.2.7	 	a written confirmation that (a) the Vendor is not in material breach of any
of the Warranties or any of its obligations in this Agreement and (b) all loans
or other indebtedness due or owing to any member of the Group by the Vendor or
the directors of all members of the Group (other than in the capacity as
employees) or their respective associates have been repaid in full;
	 
	 	6.2.2.8	 	duly executed transfers and sold notes (if applicable) in favour of the
Company (or its nominees) in respect of the one share in J.I.C. Enterprises
(Hong Kong) Limited held by Chui Kam Wai on behalf of the Company; and
	 
	 	6.2.2.9	 	a certificate from a director of the Company confirming that as at the
Completion Date:






	 	(a)	 	if Completion is conducted on
or before the Latest Announcement Date, the amount of Total
Cash is not less than the relevant Warranted Cash Level; and
	 
	 	(b)	 	J.I.C. Enterprises (Hong Kong)
Limited is inactive, has no assets or liabilities other than
those disclosed in its balance sheet as at 31 December 2005,
and has no material change in assets and liabilities since 31
December 2005.






	 	6.2.3	 	cause such persons as the Purchaser may nominate to be validly appointed (by
procuring the necessary board resolutions to be duly passed by the Completion Date) as
directors of the Company, subject to their being acceptable to the Stock Exchange, with
effect from the earliest time permitted under (or pursuant to any dispensation from)
the Takeovers Code or by the SFC, and as directors of the other members of the Group
with effect from the Completion Date;
	 
	 	6.2.4	 	cause (by procuring the necessary board resolutions to be duly passed by the
Completion Date):




9









 












	 	6.2.4.1	 	any director, officer or employee of any member of the Group as the Parties
may agree to resign from the relevant member of the Group with effect from the
earliest time permitted under (or pursuant to any dispensation from) the
Takeovers Code or by the SFC (or, where the Parties otherwise agree, cause such
director, officer or employee to agree not later than the Completion Date to
resign with effect from a later reasonable date as the Parties may agree);
	 
	 	6.2.4.2	 	such persons as the Purchaser may nominate to be validly appointed as the
company secretary and the auditors of any member of the Group and upon such
appointment forthwith cause the existing company secretary and the existing
auditors of each such member of the Group to resign from their respective
offices and as an employee in the case of the company secretary (if applicable)
with effect from the Completion Date (or, where the Parties otherwise agree,
cause such company secretary and auditors to agree not later than the
Completion Date to resign with effect from a later reasonable date as the
Parties may agree), provided that the resignation of the auditors shall only be
effective after they have completed the annual audit of the Group for the year
ended 31 December 2007,






	 	 	 	and cause (a) any person so resigning as director or secretary to
deliver to the Purchaser a letter under seal or otherwise executed as a deed
addressed to the relevant member of the Group in the form set out in Schedule 4
and (b) any person so resigning as auditors to deliver to the Purchaser a
letter of resignation addressed to the relevant member of the Group such
resignation to contain a statement that there are no circumstances up to and
including the Completion Date and connected with their resignation which they
consider should be brought to the attention of the members or creditors of the
relevant member of the Group; and
	 
	 	6.2.5	 	procure, with effect from the effective date of the changes referred to in
Clause 6.2.3, the revocation of all authorities to the bankers of each member of the
Group relating to bank accounts and procure the giving of authority to such persons as
the Purchaser may nominate to operate the same.






	6.3	 	At Completion, the Purchaser shall, subject to the Vendor having performed its obligations
under Clause 6.2 in accordance with the terms thereof and the Purchaser receiving satisfactory
evidence from its designated CCASS participant that the transfer of ownership of the
61,604,688 Shares out of the Sale Shares has been properly effected through CCASS:






	 	6.3.1	 	deliver to the Vendor a bankers’ draft drawn on a prime bank in Hong Kong for
the remaining balance of the Purchase Price (after deducting the amount of Earnest
Money in accordance with Clause 3.2 and, where applicable, the amount of deposit
referred to in Clause 3.3) in favour of the Vendor, being the Vendor’s nominee, whose
receipt shall be an absolute discharge therefor; and




10









 






	 	6.3.2	 	deliver to the Vendor a counterpart Deed of Indemnity duly executed by the
Purchaser.






	6.4	 	The Vendor shall procure that:






	 	6.4.1	 	all arrangements and agreements between any member of the Group on the one
hand and the Vendor or any of its associates on the other hand (including, without
prejudice to the generality of the foregoing, all agreements between any of such
parties relating to the management of any member of the Group, but excluding those
arrangements or agreements set out in Schedule 5); and
	 
	 	6.4.2	 	any agreement or arrangement relating to the affairs of any member of the
Group between the Vendor or any of its associates on the one hand and any officer or
employee of any member of the Group on the other hand,






	 	 	shall in each case be terminated on or before the Completion Date by mutual agreement
between the respective parties thereto but without further liability on the part of the
relevant member of the Group and on approved terms.
	 
	6.5	 	Without prejudice to any other remedies available to the Purchaser, if in any respect the
provisions of Clause 6.2 or 6.4 are not complied with by the Vendor on the Completion Date,
the Purchaser may:






	 	6.5.1	 	defer Completion to a date not more than 21 days after the Completion Date
(and so that the provisions of Clauses 6.1 to 6.4 shall apply to Completion as so
deferred); or
	 
	 	6.5.2	 	proceed to Completion so far as practicable (without prejudice to the
Purchaser’s rights hereunder); or
	 
	 	6.5.3	 	rescind its obligations under this Agreement and, where the Purchaser has paid
the deposit to the Vendor in accordance with Clause 3.3, the Vendor shall forthwith
return the whole of such deposit to the Purchaser in cash without any interest.






	6.6	 	Notwithstanding anything to the contrary in this Agreement, in the event that Completion
cannot take place in the absence of any default of the Vendor on or before the Latest
Announcement Date (in the case where no approval from the Purchaser’s shareholders in a
general meeting is required) or the Latest Approval Date (in the case where approval from the
Purchaser’s shareholders in a general meeting is required), the Vendor may (without prejudice
to other rights which the Vendor may have against the Purchaser):






	 	6.6.1	 	defer Completion to a date as agreed with the Purchaser in writing; or
	 
	 	6.6.2	 	rescind its obligations under this Agreement.






	6.7	 	Where this Agreement is terminated or rescinded pursuant to Clause 4.3 or Clause 6:




11









 












	 	6.7.1	 	(in the absence of any default of the Vendor) the Vendor shall forthwith
return 50% of the Earnest Money (being HK$500,000) to HKE (through the Purchaser) in
cash without any interest, cost or compensation, and the Vendor shall be entitled
(without prejudice to other rights which the Vendor may have against the Purchaser) to
forfeit absolutely the remaining balance of the Earnest Money (being HK$500,000) paid
to the Vendor under the Exclusivity Agreement; and
	 
	 	6.7.1	 	(due to a default of the Vendor) the Vendor shall forthwith return the whole
of the Earnest Money (being HK$1,000,000) to HKE (through the Purchaser) in cash
without any interest, cost or compensation.






	7.	 	Further Undertakings
	 
	7.1	 	The Vendor will procure that:






	 	7.1.1	 	the business of each member of the Group is operated in a manner consistent
with past practices during the period between the date hereof and the Completion Date
and in the best interests of the Group;
	 
	 	7.1.2	 	on or before the Completion Date, all guarantees given by any member of the
Group in favour of third parties in respect of the performance of the obligations of
the Vendor or any of its associates are released or assumed by the Vendor or an
associate; and
	 
	 	7.1.3	 	on or before the Completion Date, all loans or other indebtedness due or owing
to any member of the Group by the Vendor or the directors of all members of the Group
(other than in the capacity as employees) or their respective associates are repaid in
full;






	7.2	 	Pending Completion the Vendor shall not:






	 	7.2.1	 	do, allow or procure any act or omission which would constitute a material
breach of any of the Warranties; or
	 
	 	7.2.2	 	sell, assign or transfer or purport to sell, assign or transfer any of the
Sale Shares or create or permit to be created any third party right or interest
therein.






	7.3	 	Pending Completion and save as contemplated by this Agreement or in the ordinary course of
the business of the Group, the Vendor shall procure that each member of the Group will not,
without the prior written consent of the Purchaser, engage in the following activities if and
to the extent that any of such activities will have a material adverse effect on the general
affairs of the Group as a whole:






	 	7.3.1	 	do, allow or procure any act or omission which would constitute a breach of
any of the Warranties;
	 
	 	7.3.2	 	create or permit to arise any lien, charge, encumbrance, pledge, mortgage or
other third party right or interest on or in respect of any of its undertaking,




12









 






	 	 	 	property or assets;






	 	7.3.3	 	pass any shareholders’ resolution other than a resolution for approving this
Agreement or the transactions contemplated herein;
	 
	 	7.3.4	 	enter into, or amend any existing, arrangements, agreements and contracts
(otherwise than in the ordinary course of business) including but not limited to
agreements with any of the directors or officers or employees;
	 
	 	7.3.5	 	issue or agree to issue any shares, warrants or other securities or loan
capital or grant or agree to grant any option over or right to acquire or convert into
any share or loan capital;
	 
	 	7.3.6	 	take any action which would result in the Purchaser acquiring on Completion a
percentage interest in the Company (on a fully diluted basis) lower than that
contemplated in this Agreement or the Company reducing its interest in any Subsidiary;
	 
	 	7.3.7	 	declare, pay or make any dividends or other distributions;
	 
	 	7.3.8	 	appoint any director, company secretary or auditor (other than the
appointments referred to in Clauses 6.2.3 and 6.2.4.1);
	 
	 	7.3.9	 	carry on any business which constitutes a material deviation from the business
currently carried on by it;
	 
	 	7.3.10	 	incorporate any subsidiary or permit the disposal or dilution of its interest,
directly or indirectly, in any subsidiary or acquire shares in any company or dispose
of any shares in any company or acquire or dispose of any loans or loan capital;
	 
	 	7.3.11	 	consolidate or merge with or acquire any other business;
	 
	 	7.3.12	 	enter into any partnership or joint venture arrangement;
	 
	 	7.3.13	 	make any loan or advance or give any credit (other than trade credits in the ordinary
course of business);
	 
	 	7.3.14	 	give any guarantee or indemnity for or otherwise secure the liabilities or
obligations of any person save and except the Company and the Subsidiaries;
	 
	 	7.3.15	 	sell, transfer, lease, assign or otherwise dispose of any material part of its
undertaking, property or assets (or any interest therein) or contract so to do;
	 
	 	7.3.16	 	make any capital expenditure in excess of HK$1,000,000;
	 
	 	7.3.17	 	hire or change the terms of employment of any employee or terminate the employment of
any employee (other than as contemplated in Clauses 6.2.4 and 6.4);




13









 












	 	7.3.18	 	take any action in relation to pensions, retirement schemes or share option schemes
(including but not limited to the grant of options under the Share Option Scheme);
	 
	 	7.3.19	 	take any action in relation to profit-sharing or bonus schemes or any other executive
or employee benefits;
	 
	 	7.3.20	 	alter its financial year end;
	 
	 	7.3.21	 	amend the accounting policies or reporting practices previously adopted by it;
	 
	 	7.3.22	 	settle or compromise any major claims in relation to Tax;
	 
	 	7.3.23	 	commence, settle or take any action relating to any litigation, arbitration or other
proceedings concerning the Group’s business or assets (other than the existing
litigation disclosed in the Disclosure Letter); and/or
	 
	 	7.3.24	 	make, amend or terminate any long-term, unusual or onerous contract (long-term
meaning a contract under which the obligations of any party thereto may remain
outstanding for more than one year) or take any action which could, as a consequence of
any action taken by another party, result in any of the same.






	7.4	 	Where any member of the Group proposes to enter into any transaction, agreement or
arrangement (or any series of transactions, agreements or arrangements) other than its monthly
payroll which involves a transaction amount (or the amount of that member’s commitment or
liability) that will exceed HK$1,000,000 in a single transaction, agreement or arrangement or
HK$1,000,000 on an annual basis, the Vendor’s obligations in Clauses 7.1, 7.2 and/or 7.3 shall
not be deemed to have been fulfilled unless the relevant member of the Group has obtained the
Purchaser’s prior written approval to such proposal.
	 
	7.5	 	The Vendor shall assist, and shall procure that the Company and its directors, officers and
employees assist, the Purchaser in all negotiations and exchanges of correspondence with the
SFC and the Stock Exchange in connection with all requests by such regulatory authorities.
	 
	7.6	 	The Vendor undertakes to indemnify and keep indemnified the Purchaser (for itself and as
trustee for each member of the Group) against any claims which may be brought by the directors
and any other persons who resign or are intended to resign pursuant to Clause 6.2.4 or Clause
6.4.3.
	 
	7.7	 	The Purchaser undertakes that it shall use its best endeavours to:






	 	7.7.1	 	prepare and clear the joint announcement of the Purchaser and the Company in
relation to this Agreement and the General Offer by the Latest Announcement Date (or
such other date as the Parties may otherwise agree in writing) , and allow the Vendor
to make reasonable comments;
	 
	 	7.7.2	 	(where the Purchaser’s shareholders’ approval on the Agreement and the
transactions contemplated hereunder is required) provide all information and




14









 






	 	 	 	respond to the Stock Exchange in a timely manner with a view to obtaining a waiver
from convening the Purchaser’s general meeting under Chapter 14 of the Listing
Rules;






	 	7.7.3	 	(where the waiver referred to in Clause 7.7.2 is granted) obtain written
shareholders’ approval of the Purchaser on this Agreement and the transactions
contemplated herein on or before the Latest Announcement Date; and
	 
	 	7.7.4	 	(where the Purchaser is required to convene a general meeting) obtain
irrevocable voting instructions of more than 50% of the Purchaser’s shareholders
approving this Agreement and the transactions contemplated herein no later than the
business day immediately after the joint announcement referred to in Clause 7.7.1 has
been published, and seek the Purchaser’s shareholders approval in general meeting for
such purpose on or before the Latest Approval Date.






	7.8	 	The Vendor undertakes to provide to the Purchaser within three business days from the date
hereof a copy of the duly signed termination agreement in relation of the Consultancy
Agreement dated 18 June 2007 and entered into between the Company and Keizo Kitahara.
	 
	8.	 	Warranties
	 
	8.1	 	The Vendor hereby represents, warrants and undertakes to the Purchaser (to the intent that
the provisions of this Clause shall continue to have full force and effect notwithstanding
Completion) that each of the statements set out in Schedule 2 is now and will at Completion be
true and accurate and acknowledge that the Purchaser in entering into this Agreement is
relying on such Warranties and has been induced by them to enter into this Agreement.
	 
	8.2	 	The Warranties are given subject to the matters fairly disclosed in the Disclosure Letter but
no other information relating to any member of the Group of which the Purchaser has knowledge
(actual or constructive) and no investigation by or on behalf of the Purchaser shall prejudice
any claim made by the Purchaser under such Warranties or under the indemnity contained in
Clause 8.5 or operate to reduce any amount recoverable and it shall not be a defence to any
claim against the Vendor that the Purchaser knew or ought to have known or had constructive
knowledge of any information (other than as disclosed in the Disclosure Letter) relating to
the circumstances giving rise to such claim.
	 
	8.3	 	The Warranties set out in each paragraph of Schedule 2 shall be separate and independent and
save as expressly provided shall not be limited by reference to or inference from any other
paragraph or anything in this Agreement or the Schedules nor anything in the Disclosure Letter
which is not expressly referenced to the Warranty concerned.
	 
	8.4	 	The Warranties set out in each paragraph of Schedule 2 shall be deemed to be given on the
date of this Agreement and on the Completion Date as if all references therein




15









 






	 	 	to the date of this Agreement were (save where the context precludes) references to the
Completion Date.






	8.5	 	The Vendor hereby undertakes to indemnify and keep indemnified the Purchaser (for itself and
as trustee for each member of the Group) against any costs, expenses and liability properly
and reasonably incurred by the Purchaser in connection with any breach of any Warranties by
the Vendor; and the indemnity contained in this Clause shall be without prejudice to any other
rights and remedies of the Purchaser in relation to any such breach of Warranties and all such
other rights and remedies are hereby expressly reserved to the Purchaser.
	 
	8.6	 	Where any statement in the Warranties is qualified as being subject to the knowledge of the
Vendor, that statement shall be deemed to include an additional statement that it has been
made after due and careful enquiry by the Vendor so as to ensure that it is true and accurate
and is not misleading, whether by reason of an omission or otherwise.
	 
	8.7	 	The Vendor hereby agrees with the Purchaser (for itself and as trustee for the Company and
each of the Subsidiaries) to waive any rights which it may have in respect of any
misrepresentation or inaccuracy in, or omission from, any information or advice supplied or
given by the Company or its Subsidiaries or its or their officers, employees or advisers in
connection with the giving of the Warranties and the preparation of the Disclosure Letter.
	 
	8.8	 	If any sum payable by the Vendor under this Agreement shall be subject to Tax (whether by way
of deduction or withholding or direct assessment of the person entitled thereto) such payment
shall be increased by such an amount as shall ensure that after deduction, withholding or
payment of such Tax the recipient shall have received a net amount equal to the payment
otherwise required hereby to be made.
	 
	8.9	 	Any liability of the Vendor in respect of a breach of the Warranties or a breach of any
obligation under this Agreement or the Deed of Indemnity shall survive Completion.
	 
	8.10	 	The Vendor will not be liable under any of the Warranties unless notice of a claim under the
Warranties specifying in reasonable detail and to the extent possible the event or default to
which the claim relates and the nature of the breach and amount claimed has been received by
the Vendor not later than the expiry of the period of three years following Completion.
	 
	8.11	 	Any claim in respect of which notice has been given in accordance with Clause 8.10 will be
deemed to have been irrevocably withdrawn and lapsed if (not having been previously satisfied,
settled or withdrawn) proceedings in respect of such claim have not been issued and served on
the Vendor not later than the expiry of the period of six months after the date of such
notice.
	 
	8.12	 	The Vendor will only be liable in respect of any one claim under the Warranties (except the
Warranty set out in paragraph 17 of Schedule 2 to which the thresholds in Clauses 8.12.1 and
8.12.2 shall not apply) if:




16









 












	 	8.12.1	 	the amount finally adjudicated or agreed as being payable in respect of one claim is
in excess of HK$1,000,000 (provided however that claims arising out of the same subject
matter will for the purposes of this Clause be construed as one claim); and
	 
	 	8.12.2	 	the aggregate amount finally adjudicated or agreed as being payable in respect of all
such claim or claims is in excess of HK$5,000,000 in which event, the Vendor will be
liable for the whole amount and not merely for the excess.






	8.13	 	The total liability of the Vendor for claims made under the Warranties will not exceed
HK$271.4 million.
	 
	8.14	 	The Vendor will not be liable under the Warranties to the extent that any depletion,
diminution or reduction in the value or amount of any of the assets of the Company or any
member of the Group occurs as a result of or is otherwise attributable to any legislation not
in force at the date of this Agreement or any change of law or administrative practice which
takes effect retroactively or occurs as a result of any increase in the rates of Tax in force
at the date of this Agreement.
	 
	8.15	 	The Vendor will not be liable for a breach of any of the Warranties to the extent that the
loss suffered by the Purchaser or any member of the Group also gives rise to an equivalent
claim under the Deed of Indemnity and the Vendor has satisfied such equivalent claim. The
Vendor will not be liable for a claim under the Deed of Indemnity to the extent that an
equivalent claim has been made under the Warranties and the Vendor has satisfied such
equivalent claim.
	 
	8.16	 	Upon its becoming aware of any matter which is a breach of or inconsistent with any of the
Warranties or may give rise to a claim under any of the Warranties:






	 	8.16.1	 	the Purchaser shall as soon as reasonably practicable give notice to the Vendor of
the matter; and
	 
	 	8.16.2	 	in relation to a claim by a third party (the “Third Party Claim”) against any member
of the Group and/or the Purchaser which may give rise to a claim under any of the
Warranties, the Vendor shall at its own costs take such action, give assistance and
institute such proceedings as may be reasonably requested by the Purchaser to (a)
avoid, dispute, resist, mitigate, settle, compromise, defend, remedy or appeal the
Third Party Claim and (b) enforce against any person the rights of the Purchaser or the
Company in relation to the Third Party Claim.






	8.17	 	Where the Purchaser or any member of the Group is at any time entitled to recover from some
person other than the Vendor any sum in respect of any matter giving rise to a claim under the
Warranties, the Purchaser shall promptly take all reasonable steps available to it to enforce
such recovery. In the event that the Purchaser or the Group shall recover any amount from
such other person, the amount of the Purchaser’s claim against the Vendor shall be reduced by
the amount recovered.
	 
	8.18	 	If the Purchaser receives from the Vendor an amount in respect of any claim under the
Warranties and the Purchaser or the Group subsequently becomes entitled to recover




17









 






	 	 	from some other person (whether under any provision of applicable law, insurance policy or
otherwise howsoever) any sum which is directly referable to such claim, then:






	 	8.18.1	 	the Purchaser shall as soon as practicable take all reasonable steps available to it
to enforce such recovery; and
	 
	 	8.18.2	 	the Purchaser shall as soon as practicable pay to the Vendor any sum it receives from
such other person to the extent that the aggregate of the sum received from the Vendor
and the sum received from such other person exceeds the aggregate of (i) the amount of
the loss suffered by the Purchaser or the Group with respect to such claim; and (ii)
any cost and expenses incurred by the Purchaser or the Group in obtaining recovery from
such other person.






	8.19	 	The Purchaser shall procure that all reasonable steps are taken and all reasonable assistance
is given to avoid or mitigate any losses which, in the absence of mitigation, might give rise
to a liability in respect of any claim for breach of any Warranty by the Vendor under this
Agreement.
	 
	8.20	 	Any limitation to the Vendor’s liabilities in this Clause 8 shall not apply to any breach of
Warranties or any liabilities of the Vendor which is arisen from or is attributable to any
fraud, wilful concealment or dishonesty on the part of the Vendor.
	 
	9.	 	Restriction on Announcements and Disclosure
	 
	9.1	 	None of the Parties hereto shall, without the prior written consent of the other Party,
disclose the terms of, or any matters referred to in, this Agreement except to its
professional advisers and senior management whose province is to know such terms or matters
and to those persons to whom it may be necessary to disclose such terms or matters for the
purpose of or in connection with this Agreement or the General Offer and subject as required
by law or by the SFC and/or the Stock Exchange or by virtue of the Takeovers Code, the Listing
Rules or of any other regulatory requirements.
	 
	9.2	 	Subject as provided in Clause 9.3, none of the Parties shall make any public announcement in
relation to the transactions the terms of which are set out in this Agreement or the
transactions or arrangements hereby contemplated or herein referred to or any matter ancillary
hereto or thereto without the prior written consent of the other Party (which consents shall
not be unreasonably withheld or delayed).
	 
	9.3	 	This Clause 9 shall not apply to any announcement required to be made pursuant to the
Takeovers Code or the Listing Rules as to the contents of which the Party making the same
shall have consulted and agreed with the other Party and obtained approval from the SFC and/or
the Stock Exchange as may be required.
	 
	9.4	 	Each of the Parties hereto undertakes that prior to Completion and thereafter it will not
(save as required by law, any regulatory requirement, the Stock Exchange or the SFC) make any
announcement in connection with this Agreement or the transactions or arrangements
contemplated hereunder or referred to herein unless the other Party




18









 






	 	 	hereto shall have given its consent to such announcement (which consent may not be
unreasonably withheld or delayed and may be given either generally or in a specific case or
cases and may be subject to conditions).






	10.	 	Access to Information
	 
	10.1	 	As from the date of this Agreement, the Vendor shall give and shall procure that the
Purchaser and any persons authorised by it will be given all such information relating to each
member of the Group and such access to the premises and all books, title deeds, records,
accounts and other documentation of each member of the Group as the Purchaser may request and
be permitted to take copies of any such books, deeds, records, accounts and other
documentation and that the officers and employees of each member of the Group shall be
instructed to give promptly all such information and explanations to any such persons as
aforesaid as may be requested by it or them.
	 
	10.2	 	The Purchaser hereby undertakes that it will not prior to Completion, save as required by
law, the SFC or the Stock Exchange, divulge any confidential information relating to the Group
obtained by it or its representatives pursuant to this Clause 10 to any person other than its
own officers, employees or professional advisers.
	 
	11.	 	Restriction of Vendor
	 
	11.1	 	The Vendor undertakes with the Purchaser (for itself and as trustee for the Company and each
of the Subsidiaries) that, except with the consent in writing of the Purchaser, if, in
connection with the business or affairs of any member of the Group, it shall have obtained
trade secrets or other confidential information belonging to any third party under an
agreement purporting to bind any member of the Group which contained restrictions on
disclosure, it will not without the previous written consent of the board of directors of the
Purchaser at any time infringe or take any action which would or might result in an
infringement of such restrictions;
	 
	11.2	 	The Vendor will procure that its subsidiaries will observe the restrictions contained in the
foregoing provisions of this Clause 11.
	 
	11.3	 	While the restrictions contained in this Clause 11 are considered by the Parties to be
reasonable in all the circumstances, it is recognised that restrictions of the nature in
question may fail for technical reasons and accordingly it is hereby agreed and declared that
if any of such restrictions shall be adjudged to be void as going beyond what is reasonable in
all the circumstances for the protection of the interests of the Purchaser but would be valid
if part of the wording thereof were deleted or the periods thereof reduced or the range of
activities or area dealt with thereby reduced in scope the said restriction shall apply with
such modifications as may be necessary to make it valid and effective.




19









 












	12.	 	Miscellaneous
	 
	12.1	 	Each Party shall pay its own costs and disbursements of and incidental to this Agreement and
the sale and purchase hereby agreed to be made. All stamp duty payable on the instruments of
transfer and bought and sold notes in respect of the sale and purchase of the Sale Shares
shall be borne in equal share by the Vendor and the Purchaser.
	 
	12.2	 	Each notice, demand or other communication given or made under this Agreement shall be in
writing and delivered or sent to the relevant Party at its address or facsimile number set out
below (or such other address or facsimile number as the addressee has by five (5) days’ prior
written notice specified to the other Party):





	 	 	 
	To the Vendor:

	 	Address: c/o Suites 1506-1508, 15/F., One Exchange Square, 8 
Connaught Place, Central, Hong Kong
	 

	 	Facsimile No.: 852-22631223
	 

	 	Attention: Mr. John Qunito Farina
	 
	 	 
	To the Purchaser:

	 	Address: 9th Floor, Tower 1, South Seas Centre,

75 Mody Road, Tsim Sha Tsui East, Kowloon, Hong Kong
	 

	 	Facsimile No.: 852-27310069
	 

	 	Attention: Mr. Kirk Tsang







	 	 	Any notice, demand or other communication so addressed to the relevant Party shall
be deemed to have been delivered: (a) if given or made by personal delivery or prepaid
registered post, when actually delivered to the relevant address; and (b) if given or
made by facsimile, when despatched subject to machine-printed confirmation of receipt
being received by the sender.
	 
	12.3	 	No failure or delay by a Party in exercising any right, power or remedy under this Agreement
shall operate as a waiver thereof, nor shall any single or partial exercise of the same
preclude any further exercise thereof or the exercise of any other right, power or remedy.
Without limiting the foregoing, no waiver by a Party of any breach by the other Party of any
provision hereof shall be deemed to be a waiver of any subsequent breach of that or any other
provision hereof. If at any time any provision of this Agreement is or becomes illegal,
invalid or unenforceable in any respect, the legality, validity and enforceability of the
remaining provisions of this Agreement shall not be affected or impaired thereby.
	 
	12.4	 	This Agreement shall not be assignable unless otherwise agreed by the other Party.
	 
	12.5	 	This Agreement (together with any documents referred to herein) constitutes the whole
agreement between the Parties hereto and it is expressly declared that no variations hereof
shall be effective unless made in writing.
	 
	12.6	 	The provisions of this Agreement including the Warranties herein contained, insofar as the
same shall not have been fully performed at Completion, shall remain in full force and effect
notwithstanding Completion.




20









 












	12.7	 	Any right of rescission conferred upon the Purchaser hereby shall be in addition to and
without prejudice to all other rights and remedies available to it.
	 
	12.8	 	The Vendor and the Purchaser shall do and execute or procure to be done and executed all such
further acts, deeds, things and documents as may be necessary to give effect to the terms of
this Agreement and to place control of the Company and each member of the Group in the hands
of the Purchaser.
	 
	12.9	 	This Agreement may be executed in one or more counterparts, and by the Parties on separate
counterparts, but shall not be effective until every party has executed at least one
counterpart and each such counterpart shall be an original of this Agreement but all the
counterparts shall together constitute one and the same instrument.
	 
	13.	 	Governing Law and Jurisdiction
	 
	13.1	 	This Agreement shall be governed by and construed in accordance with the laws of Hong Kong
and the Parties hereto hereby irrevocably submit to the non-exclusive jurisdiction of the Hong
Kong courts for the purpose of enforcing any claim arising hereunder.
	 
	13.2	 	The Vendor hereby irrevocably appoints Wilkinson & Grist of 6th Floor, Prince’s
Building, 10 Charter Road, Central, Hong Kong as its agent to receive and acknowledge on its
behalf service of any writ, summons, order, judgment or other notice of legal process in Hong
Kong. If for any reason the agent named above (or its successor) no longer serves as agent of
the Vendor for this purpose, the Vendor shall promptly appoint a successor agent satisfactory
to the Purchaser, notify the Purchaser thereof and deliver to the Purchaser a copy of the new
process agent’s acceptance of appointment Provided that until the Purchaser receives such
notification, it shall be entitled to treat the agent named above (or its said successor) as
the agent of the Vendor for the purposes of this Clause 13.2. The Vendor agrees that any such
legal process shall be sufficiently served on it if delivered to such agent for service at its
address for the time being in Hong Kong whether or not such agent gives notice thereof to the
Vendor.




IN WITNESS WHEREOF this Agreement has been executed by the abovenamed Parties on the day and year
first above written.




21









 








SCHEDULE 1 — PART A




Particulars of the Company




The Company



Date and place of incorporation: 8 January 2002; The Cayman Islands



Address of registered office: Cricket Square, Hutchins Drive, P.O. Box 2681, Grand Cayman KY1-1111,
Cayman Islands



Authorised share capital: HK$26,000,000 being comprised of 2,600,000,000 shares of HK$0.01 each



Issued share capital: HK$7,635,347.55 being comprised of 763,534,755 Shares of HK$0.01 each




Directors:

Executive Director:

Liu Xue Qing




Non-Executive Director:

Koo Ming Kown




Independent Non-Executive Directors

Cham Yau Nam

Leung Wai Hung

Choi Man Chau Michael



Secretary: Chan Bo Shan



Annual accounts date: 31 December



Auditors: Deloitte Touche Tohmatsu




22









 








SCHEDULE 1 — PART B




Particulars of the Subsidiaries



Name of Subsidiary: J.I.C. (Macao Commercial Offshore) Company Limited



Date and place of incorporation: 12 November 2004; Macau



Address of registered office: Unit D, 17th Floor, Edificio Comercial Rodrigues, 599 da
Avenida da Praia Grande, Macau



Authorised share capital: MOP 100,000



Issued share capital: One quota each MOP 100,000



Registered shareholders and beneficial owners and shareholding: J.I.C. Technology Company Limited



Directors: Koo Ming Kown and Chui Kam Wai



Secretary: Nil



Annual accounts date: 31 December



Auditors: Deloitte Touche Tohmatsu




23









 







Name of Subsidiary: Best Whole Holdings Limited



Date and place of incorporation: 13 November 2007; Hong Kong



Address of registered office: Suites 1506-1508, One Exchange Square, 8 Connaught Place, Hong Kong



Authorised share capital: HK$10,000 divided into 10,000 shares of HK$1 each



Issued share capital: 1 ordinary share of HK$1



Registered shareholders and beneficial owners and shareholding: Joy Holdings Limited — 1 share



Directors: Koo Ming Kown, Wong Kuen Ling Karene and John Quinto Farina



Secretary: Wong Long Kee



Annual accounts date: 31 December



Auditors: Deloitte Touche Tohmatsu




24









 







Name of Subsidiary: Joy Holdings Limited



Date and place of incorporation: 2 November 2007; British Virgin Islands



Address of registered office: P.O. Box 957, Offshore Incorporations Centre, Road Town, Tortola,
British Virgin Islands



Authorised share capital: US$50,000 divided into 50,000 shares of a single class each with a par
value of US$1



Issued share capital: 1 ordinary share of US$1



Registered shareholders and beneficial owners and shareholding: J.I.C. Technology Company Limited
— 1 share



Directors: Koo Ming Kown, Wong Kuen Ling Karene and John Quinto Farina



Secretary: Nil



Annual accounts date: 31 December



Auditors: Deloitte Touche Tohmatsu




25









 







Name of Subsidiary: J.I.C. Enterprises (Hong Kong) Limited



Date and place of incorporation: February 18, 1983; Hong Kong



Address of registered office: Suite 1506-08, One Exchange Square, 8 Connaught Place, Central, Hong
Kong



Authorised share capital: HK$500,000 divided into 500,000 ordinary shares of HK$1.00 each



Issued share capital: 500,000 ordinary shares of HK$1.00 each



Registered shareholders and beneficial owners and shareholding:





J.I.C. Technology Company Limited — holds 499,999 shares

Chui Kam Wai — holds 1 share on behalf of J.I.C. Technology Company Limited


Directors: Nomitor Limited





Willserve Limited


Secretary: Wilgrist Nominees Limited



Annual accounts date: 31 December



Auditors: Deloitte Touche Tohmatsu



Status: inactive, has no assets or liabilities other than those disclosed in its balance sheet as
at 31 December 2005, and has no material change in assets and liabilities since 31 December 2005




26









 







Name of Subsidiary: Shenzhen Namtek Company Limited



Date and place of incorporation: December 20, 1995; PRC



Address of registered office: 



Registered capital: US$800,000



Registered shareholders and beneficial owners and shareholding: Best Whole Holdings Limited





			
	Directors:	 	Kazuhiro Asano

Koo Ming Kown

Liu Xue Qing

Wong Kuen Ling, Karene




Secretary: Nil



Annual accounts date: 31 December



Auditors: Deloitte Touche Tohmatsu




27









 







Name of Subsidiary: Kabushiki Kaisha Namtek Japan (expressed in English as Namtek Japan Co.,
Ltd.)



Date and place of incorporation: 30 June 2003; Japan



Address of registered office: 6th Floor, Sakura-Masamune, Higashi-Nihonbashi Building
3-12-12
Higashi-Nihonbashi, Chuo-Ku, Tokyo



Authorised share capital: JAP 50,000,000 divided into 500,000 shares



Issued share capital: 100,000 shares of JPY 100 each



Registered shareholders and beneficial owners and shareholding: J.I.C. Technology Company Limited





			
	Directors:	 	Kazuhiro Asano

Toshiaki Sunahara

Koo Ming Kown

Lei Lai Fong, Patinda

Wong Kuen Ling, Karene




Secretary: Nil



Annual accounts date: 31 December



Auditors: Deloitte Touche Tohmatsu





28












 





SCHEDULE 2




Warranties



In this Schedule, unless the context otherwise indicates, each of the Warranties in relation to the
Company shall be deemed to be repeated mutatis mutandis in relation to each of the other members of
the Group and in such repeated Warranties references to the Company shall be deemed to be
references to such other member of the Group.





	1.	 	Corporate Matters
	 
	1.1	 	The Company has been duly incorporated and is validly existing under the laws of its place of
incorporation and the Shares are listed and traded on the Stock Exchange. No order has been
made or petition presented or resolution passed for the winding up of the Company and no
distress, execution or other process has been levied on any of its assets. The Company is not
insolvent nor unable to pay its debts as referred to in section 178 of the Companies
Ordinance, no receiver or receiver and manager has been appointed by any person of its
business or assets or any part thereof, no power to make any such appointment has arisen, the
Company has taken no steps to enter liquidation and there are no grounds on which a petition
or application could be based for the winding up or appointment of a receiver of the Company.
	 
	1.2	 	The Vendor is the beneficial owner of the Sale Shares, free and clear of any lien, charge,
option, right of pre-emption or other encumbrance or third party right whatsoever and the
Company has not exercised any lien over any of its issued shares and there is outstanding no
call on any of the Sale Shares and all of the Sale Shares are fully paid and rank pari passu
with other existing Shares in all respects.
	 
	1.3	 	The Sale Shares constitute all the issued shares in the Company that are owned by the Vendor
and no issued Shares in the Company are owned by any associates of the Vendor. The Sale Shares
represent approximately 74.99 per cent of all of the issued shares in the capital of the
Company.
	 
	1.4	 	The Company has no subsidiary or shares in or stock of any company or a direct or indirect
interest in any entity other than the Subsidiaries listed in Part B or Schedule 1. All of the
details shown in Parts A and B of Schedule 1 are accurate and not misleading. The Company is
not a director or other officer of any other company or entity.
	 
	1.5	 	The Company does not have any place of business or branch or permanent establishment outside
Hong Kong or its jurisdiction of incorporation, nor has it carried on any trading activities
outside such jurisdictions.
	 
	1.6	 	There are no options or other agreements outstanding which call for the issue of or accord to
any person the right to call for the issue of any shares in the capital of the Company
(whether of not under the Share Option Scheme) or the right to require the creation of any
mortgage, charge, pledge, lien or other security or encumbrance over the Sale Shares or any of
the assets of the Company.




29









 












	1.7	 	The copies of the Memorandum and Articles of Association or Bye-Laws (as may be applicable)
of the Company provided or to be provided to the Purchaser are accurate and complete in all
respects and have attached to them copies of all resolutions and agreements which are required
to be so attached. The Company has complied with its Memorandum and Articles of Association
or Bye-Laws (as may be applicable) in all material respects, has full power, authority and
legal right to own its assets and carry on its business and, to the best of the knowledge of
the Vendor, none of the activities, agreements, commitments or rights of the Company is ultra
vires or unauthorised.
	 
	1.8	 	The Register of Members and all other statutory books of the Company are up to date (save for
Completion matters) and contain true full and accurate records of all matters required to be
dealt with therein and the Company has not received any notice of any application or intended
application under the Companies Ordinance or any other applicable legislation or regulations
for rectification of the Company’s register, and all annual or other returns required to be
filed with the Companies Registry or any other relevant authority have been properly filed
within any applicable time limit and all legal requirements relating to the formation of the
Company and the issue of shares and other securities by the Company have been complied with.
	 
	2.	 	The Accounts
	 
	2.1	 	The Accounts have been prepared in accordance with the requirements of all relevant laws and
applicable statements of standard accounting practice and with good and generally accepted
accounting principles and practice consistently applied, are complete and accurate in all
material respects, show a true and fair view of the state of affairs of the Company and of its
results and profits for the financial period ending on the Accounting Date and disclose and
make proper provision or reserve for all liabilities (whether actual or contingent and whether
quantified or disputed or otherwise) in accordance with the statutory requirements and the
applicable generally accepted accounting principles applicable to the Company.
	 
	2.2	 	The Accounts contain proper provision for all Tax including deferred or provisional taxation
liable to be assessed on the Company for the accounting period ended on the Accounting Date or
for any subsequent period (on the basis of the rates of Tax and taxation statutes in force at
the Accounting Date) in respect of any transaction, event or omission occurring or any income
or profits or gains earned, accrued or received by the Company on or prior to the Accounting
Date or for which the Company is accountable up to such date and all contingent liabilities
for Tax have been provided for or disclosed in the Accounts in accordance with the statutory
requirements and the applicable generally accepted accounting principles applicable to the
Company.
	 
	2.3	 	Except as disclosed in the Disclosure Letter, there are no loans, guarantees, pledges,
mortgages, charges, liens, debentures, encumbrances or unusual liabilities given, made or
incurred by or on behalf of the Company (and, in particular but without limiting the
foregoing, no loans have been made by or on behalf of the Company to any directors or
shareholders of the Company or to any associate of any such directors or shareholders) and no
person has given any guarantee of or security for any liability of the Company.




30









 












	3.	 	Tax, Records and Returns
	 
	3.1	 	No event, act, transaction or omission has occurred or shall occur between the Accounting
Date and Completion which could give rise to a claim under the terms of the Deed of Indemnity
and since the Accounting Date no liability or contingent liability for Tax has arisen
otherwise than as a result of trading activities in the ordinary course of business of the
Company.
	 
	3.2	 	The Company has filed all returns, computations, notices and information required to be made
or provided by the Company for any Tax purpose and the same have been made or given within the
requisite periods and on a proper basis and when made were true and accurate and are up to
date and none of them is or is likely to be the subject of any dispute with any Tax authority.
	 
	3.3	 	The Company has paid when due, and has withheld, deducted and accounted to the relevant Tax
authorities for, all Tax, including provisional taxation, which it has become liable to pay,
withhold, deduct or account for on or before the date hereof and within the period of seven
years prior to the date hereof neither the Company nor any director or officer of the Company
has paid or become liable to pay any fine, penalty, surcharge or interest in relation to Tax.
	 
	3.4	 	No payments of rents, interest, annuity, royalties, annual payments, emoluments,
remuneration, compensation for loss of office or other sums of an income or revenue nature
made or payable by the Company or which the Company is under an obligation to pay in the
future have been, are or (under the law as presently in force) may be wholly or partially
disallowable as deductions or charges in computing profits or against profits for Tax purposes
and no payments have been made since the Accounting Date for which no relief will be received,
whether as a deduction or otherwise, for Tax purposes.
	 
	3.5	 	No act or transaction has been or will be effected by the Company, the Vendor or any other
person (including the sale of the Sale Shares), in consequence of which the Company is or may
be held liable for Tax primarily chargeable against some other person.
	 
	3.6	 	The Company has not entered into or been engaged in or been a party to any transaction which
is artificial or fictitious or any transaction or series of transactions or scheme or
arrangement of which the main or dominant purpose or one of the main or dominant purposes was
the avoidance or deferral of or reduction in the liability to Tax of the Company.
	 
	3.7	 	The Company has not appropriated any trading stock to fixed assets or vice versa, all assets
are correctly shown in the Accounts as trading stock/current assets or fixed assets and any
property under development is held and shown in the Accounts as fixed assets.
	 
	3.8	 	None of the assets of any member of the Group have been purchased at an under value or been
given to any member of the Group in circumstances where the gift or element of under value
(including (without limitation) any gift or element of under value which might be regarded as
property passing on the death of a deceased




31









 












	 	 	pursuant to the provisions of section 6(1)(c) of the Estate Duty Ordinance) might be subject
to or give rise to any form of Estate Duty chargeable or assessable against any member of
the Group or on any of its assets.
	 
	3.9	 	There is no unsatisfied liability to estate duty attached or attributable to the Sale Shares
or any asset of the Company, there has been no transfer of any property to the Company which
has given or may give rise to any claim, assessment or demand in relation to estate duty under
section 35 of the Estate Duty Ordinance (Chapter 111 of the Laws of Hong Kong), there is no
charge or potential charge on any property or assets of the Company under section 18 or
section 43(6) of the Estate Duty Ordinance and no person is liable to estate duty attributable
to the value of any of the Sale Shares or any asset of the Company.
	 
	3.10	 	All documents to which the Company is a party or which form part of the Company’s title to
any asset or in the enforcement of which the Company is or may be interested which are subject
to stamp or similar duty have been duly stamped and, where appropriate or necessary,
adjudicated.
	 
	3.11	 	No member of the Group has ceased to be associated (within the meaning of section 45(2) of
the Stamp Duty Ordinance) with another company or body corporate in circumstances which might
give rise to a liability to stamp duty pursuant to section 45(5A) of the Stamp Duty Ordinance
where such stamp duty has not been paid in full prior to the date hereof and no member of the
Group will prior to or at Completion, whether by virtue of this Agreement or otherwise, cease
to be associated (within the meaning of section 45(2) of the Stamp Duty Ordinance) with
another company or body corporate in circumstances which might give rise to a liability to
stamp duty pursuant to section 45(5A) of the Stamp Duty Ordinance. No member of the Group has
entered into a transaction within the period of two years prior to the date hereof in relation
to which relief has been claimed pursuant to section 45 of the Stamp Duty Ordinance.
	 
	3.12	 	The information given by the Company to the Customs and Excise Department and all other
authorities (whether of Hong Kong or otherwise) in connection with the import or export of any
goods was when given true and accurate and the Company has complied with all legislation,
regulations, orders, directions or conditions (whether of Hong Kong or otherwise) relating to
the import and export of goods and to all customs and excise matters, and all customs duties
and tariffs payable by the Company have been paid in full within the applicable time limits.
	 
	4.	 	Trading and General Commercial Matters
	 
	4.1	 	The Company has good title to (with full power to sell) all property and assets as are
necessary to enable it properly to conduct its business as such business has been conducted
prior to the date hereof and to all stocks used in its business. All such assets and stocks
are free from any liens, mortgages, charges, encumbrances or other third party rights and are
in the possession or under the control of the Company. The stock is in good condition and of
merchantable quality and capable of being sold by the Company in the ordinary course of
business to a purchaser in accordance with its list prices without rebate or allowance and all
other assets owned or used by the




32









 












	 	 	Company are in good repair and capable of being used for the purposes for which they are
designed, acquired or used by the Company.
	 
	4.2	 	The Company is not a party to:






	 	4.2.1	 	any unusual or onerous contract, any contract not entered into in the ordinary
course of business or not on arm’s length terms, nor any contract which cannot be
terminated without penalty or other compensation on less than twelve months’ notice;
	 
	 	4.2.2	 	any contract restricting the Company’s freedom of action in relation to its
business activities or materially and adversely affecting its business or assets;
	 
	 	4.2.3	 	any contract for the purchase or use by the Company of materials, supplies,
property or equipment which is in excess of the requirements of the Company for its
normal operating purposes;
	 
	 	4.2.4	 	any agency, distribution, marketing, purchasing, franchising, licensing
(whether by or to the Company), consulting, management, joint venture, shareholders’ or
partnership arrangement or agreement or similar arrangement other than those entered
into in the ordinary course of business;
	 
	 	4.2.5	 	any agreement or arrangement in which any of the Vendor or any of its
directors or associates or the directors of the Company is interested (except
employment agreements).






	4.3	 	There are no contracts or obligations, agreements, arrangements or concerted practices
involving the Company and no practices in which the Company is engaged, which are void,
illegal, unenforceable, registrable or notifiable under or which contravene any fair trading
or anti-trust legislation or regulations anywhere in the world nor has the Company received
any threat or complaint or request for information or investigation in relation to or in
connection with any such legislation or regulations.
	 
	4.4	 	With respect to each contract, commitment, arrangement, understanding, tender and bid
involving the Company:






	 	4.4.1	 	the Company has duly performed and complied with each of its obligations
thereunder;
	 
	 	4.4.2	 	the Company is under no obligation which cannot readily be fulfilled,
performed or discharged by it on time and without undue or unusual expenditure or
effort or loss;
	 
	 	4.4.3	 	there are no grounds for rescission, avoidance, repudiation or termination and
the Company has not received any notice of rescission or termination; and




33









 












	 	4.4.4	 	none of the other parties thereto is in default thereunder.






	4.5	 	The execution, delivery and performance of this Agreement will not result in the breach,
cancellation or termination of any of the terms or conditions of or constitute a default under
any agreement, commitment or other instrument affecting the Company or its property or assets
or result in the acceleration of any obligation under any loan agreement or in the loss of the
benefit of or in liability to refund or repay any grant or any financial or Tax concession or
relief or violate any law or any rule or regulation of any administrative agency or
governmental body or any order, writ, injunction or decree of any court, administrative agency
or governmental body affecting the Company.
	 
	4.6	 	Except as disclosed in the Disclosure Letter, there are no agreements concerning the Company
which can be terminated or which have been terminated or under which the rights of any person
are liable to be materially adversely affected as a result of a change in the shareholding of
or the control of the Company or in the composition of the board of directors of the Company.
	 
	4.7	 	There are no circumstances whereby, following a change in the control of the Company or in
the composition of the board of directors of the Company, any of the principal customers of or
suppliers or licensors to the Company would have the right to, or would, cease to remain
customers or suppliers or licensors to the same extent and of the same nature as prior to the
date hereof.
	 
	4.8	 	The Company has no capital commitments in excess of HK$1,000,000.
	 
	4.9	 	The Company has no liabilities except liabilities arising in the ordinary course of business
under contracts for service, purchase orders, supply contracts or sale contracts, nor does it
have any other liabilities direct or indirect, absolute or contingent, not required by
generally accepted accounting principles to be referred to in the Accounts, including, but not
limited to, off balance sheet financing arrangements.
	 
	4.10	 	The Company is not the subject of any official investigation or inquiry and, to the best of
the knowledge of the Vendor, there are no facts which are likely to give rise to any such
investigation or inquiry.
	 
	4.11	 	To the best of the knowledge of the Vendor, the Company is not in material default under any
provision of any contract or agreement to which it is a party or by which it is bound and no
event has occurred which constitutes a material default, or which with the giving of notice or
the passage of time or otherwise, would constitute a default under such contract or agreement
or which would require the premature repayment of any loans or other amounts due thereunder or
which would result in a material adverse change in the rights or privileges which the Company
would otherwise have or enjoy or which would result in a material increase in the liabilities
or obligations of the Company and no party with whom the Company has entered into any
agreement is in material default thereunder.
	 
	4.12	 	The Company has at all times carried on its business in compliance with all applicable laws
and regulations in all material respects. To the best of the knowledge of the




34









 












	 	 	Vendor, neither the Company, nor any of its directors or officers, has committed any
criminal offence or any tort or any breach of the requirements or conditions of any statute,
treaty, regulation, bye-law or other obligation relating to the Company or the carrying on
of its business and the Company has obtained and complied with all registrations, licences
and consents necessary or advisable for the carrying on of its business in all material
respects, and all such registrations, licences and consents are valid and subsisting and, to
the best of the knowledge of the Vendor, there is no reason why any of them should be
suspended, cancelled or revoked (whether as a result of the sale and purchase of the Sale
Shares pursuant to this Agreement or otherwise).
	 
	4.13	 	The Company has given no powers of attorney and no other authority express, implied or
ostensible which is still outstanding or effective to any person to enter into any contract or
commitment to do anything on its behalf other than the authority of employees to enter into
routine trading contracts in the normal course of their duties.
	 
	4.14	 	The Company does not have any of its records, systems, controls, data or information
recorded, stored, maintained, operated or otherwise wholly or partly dependent on or held by
any means (including any electronic, mechanical or photographic process whether computerised
or not) which (including all means of access thereto and therefrom) are not under the
exclusive ownership or direct control of the Company.
	 
	4.15	 	The Company has security procedures in place to prevent unauthorised access, amendment or
damage to the Company’s data or the data of third parties held, recorded, stored, maintained
or operated by the Company or on behalf of the Company by any third party, and, to the best of
the knowledge of the Vendor, no unauthorised access, amendment or damage to such data has
taken place during the six year period preceding the date hereof.
	 
	4.16	 	No act or transaction has been effected by or on behalf of the Company involving the making
or authorising of any payment, or the giving of anything of value, to any government official,
political party, party official or candidate for political office for the purpose of
influencing the recipient in his or its official capacity in order to obtain business, retain
business or direct business to the Company or any other person or firm.
	 
	4.17	 	In the event that Completion takes place on or before the Latest Announcement Date, the
amount of Total Cash as at the Completion Date is not less than the relevant Warranted Cash
Level. For the avoidance of doubt, if Completion takes place after the Latest Announcement
Date, there is no warranty on the Warranted Cash Level as at the Completion Date.
	 
	5.	 	Intellectual Property Rights, including confidential information
	 
	5.1	 	The Company does not use any processes and is not engaged in any activities which involve the
misuse of any know-how, lists of customers or suppliers, trade secrets, technical processes or
other confidential information (“Confidential Information”) belonging to any third party.
There has been no actual or alleged misuse by any person of any of the Company’s Confidential
Information. The Company has not disclosed to any person any of its Confidential Information
except where such




35









 












	 	 	disclosure was properly made in the normal course of the Company’s business and was made
subject to an agreement under which the recipient is obliged to maintain the confidentiality
of such Confidential Information and is restrained from further disclosing it or using it
other than for the purposes for which it was disclosed by the Company.
	 
	5.2	 	The Company does not use any processes, and is not engaged in any activities, which infringe
any Intellectual Property Rights of any third party. The Company is the beneficial owner or
the licensee of all Intellectual Property Rights used in connection with its business and the
same are valid and enforceable. The Company has taken all reasonable actions necessary to
maintain its Intellectual Property Rights and there has been no attack or challenge on any
grounds in respect of such Intellectual Property Rights. There has been no actual or alleged
infringement of any such Intellectual Property Rights.
	 
	6.	 	Software Development
	 
	 	 	With respect to all contracts, commitments, arrangements and understandings to which the
Company is party or by which it is bound, or has during the period of six years prior to
Completion been party or bound, for the design, writing, programming, development, supply or
installation of computer software or the like:
	 
	6.1	 	all computer software has been designed, written, programmed and developed in accordance with
computer methodologies that are generally recognised in the industry;
	 
	6.2	 	where the Company has the obligation to provide computer software that conforms to a
particular specification, the Company has the technical and other capabilities and the human
and material resources to produce computer software that satisfies such specifications;
	 
	6.3	 	where such contracts have been completed, all computer software that has been supplied or
installed has been fully accepted, no money owing to the Company has been retained by any
client or customer for any reason and no material complaint or claim has been received by the
Company in relation to any computer software; and
	 
	6.4	 	all computer software that has been supplied or installed by the Company which performs or is
or may be required to perform functions involving dates or the computation thereof has the
programming, design and performance capabilities to ensure that it will not suffer or cause a
malfunction.
	 
	7.	 	Computer Systems and Software
	 
	7.1	 	In this paragraph 7, subject to paragraph 7.9 below, the expression “Software” means
all computer programs and software used and developed by the Company in connection with the
business of the Company prior to the Completion Date (whether owned by the Company,
licensed to the Company by a third party or sub-licensed by the Company pursuant to
a licence agreement from a third party). A “malfunction” means failure (i) to
accurately record, store, retrieve and process data input and date information, (ii)
to function in a manner which does not create any ambiguity as to





36









 











	 	 	century, or (iii) to accurately manage and manipulate single century and multi-century
formulae, including leap year calculations.
	 
	7.2	 	The Company has title to or right to use each item of the Software including source code and
object code, user and other manuals, tapes, indices, descriptive memoranda, original listings,
development working papers, calculations and all other relevant documents, media and
confidential information free of all encumbrances and adverse claims.
	 
	7.3	 	No property rights of the Company in such Software have been sold, assigned, licensed or
disposed of to any party other than by the granting of licences to customers of the Company in
the ordinary course of its business.
	 
	7.4	 	All source codes, tapes, indices, descriptive memoranda, original listings, development
working papers, calculations and any other documents or media necessary conclusively to prove
authorship and ownership of copyright in the Software are in the possession custody or control
of the Company.
	 
	7.5	 	Where the Company is entitled to use and, where indicated, to grant sub-licences to third
parties to use the Software pursuant to licences and/or consents granted to the Company by the
owner or licensee of such Software, all royalties and other payments have been paid when due
and, to the best of the knowledge of the Vendor, there has been no act or default by the
Company or, where appropriate, its sub-licensees or any other person which may in any way
result in such licences being terminated or the Company being unable to obtain any benefit
under such licences.
	 
	7.6	 	The Company has not at any time had any dispute with any person relating to proprietary or
other rights in or to the Software. All licences relating to the Software granted by the
Company are in full force and effect and the Company after due and careful enquiry is not
aware of any breach of any terms of any such licences.
	 
	7.7	 	The Software is fit in all material respects for its intended purpose, works in all material
respects in accordance with its specifications and user or other manuals, does not contain any
material defect or feature which does or may adversely affect its performance or the
performance of any other software and is sufficient to fulfil all material commitments entered
into by the Company to carry out its business. The Company has not at any time had any
material dispute with any person relating to the functionality, quality or fitness for purpose
of the Software or relating to its compliance with its specifications or with any warranties
given by the Company or any other person relating to it.
	 
	7.8	 	The Company has taken all reasonable steps to ensure that the Software is free of any virus
and there are no grounds for believing that any virus has or will come into contact with the
Software.
	 
	7.9	 	In respect of any software that is used but not developed by the Company in connection with
the business of the Company prior to the Completion Date, the Company has obtained valid
licences to use such software and has complied with the terms of such licences in all material
respects.




37









 












	8.	 	Insurance
	 
	 	 	All assets of the Company of an insurable nature have at all times been and are insured in
amounts to the full replacement value thereof against such risks as are in accordance with
good commercial practice normally insured against. The Company has at all times maintained
such insurance as it is or has been required by any agreement to maintain and has at all
times been adequately covered against accident, third party, public liability, product
liability and other risks normally covered by insurance and nothing has been done or omitted
to be done by or on behalf of the Company which would make any policy of insurance void or
voidable or enable the insurers to avoid the same and there is no claim outstanding under
any such policy and there are no circumstances likely to give rise to such a claim or result
in an increased rate of premium.
	 
	9.	 	Litigation
	 
	 	 	Neither the Company nor any person for whose acts or defaults the Company may be vicariously
liable is or are engaged whether as plaintiff or defendant or otherwise in any civil,
criminal or arbitration proceedings or any proceedings before any tribunal (save for debt
collection by the Company in the ordinary course of business) other than those described in
the Disclosure Letter, and, to the best of the knowledge of the Vendor, there are no
proceedings threatened or pending against the Company or any such person including
proceedings in respect whereof the Company is liable to indemnify any party concerned
therein and there are no facts which are likely to give rise to any litigation or
proceedings. There are no unfulfilled or unsatisfied judgments or orders against the
Company or any of its assets.
	 
	10.	 	Employment Matters
	 
	10.1	 	There has been no past and there is no existing or (to the best of the knowledge of the
Vendor) threatened or pending industrial or trade dispute involving the Company and any of its
employees and there are no agreements or arrangements (whether oral or in writing or existing
by reason of custom and practice) between the Company and any trade union or other employees’
representatives concerning or affecting the Company’s employees.
	 
	10.2	 	To the best of the knowledge of the Vendor, no circumstances have arisen under which the
Company is likely to be required to pay damages for wrongful dismissal, to make any statutory
severance, redundancy or long service payment or to make or pay any compensation for
unreasonable dismissal or to make any other payment under any employment protection
legislation or to reinstate or re-engage any former employee. To the best of the knowledge
of the Vendor, no circumstances have arisen under which the Company is likely to be required
to pay damages or compensation, or suffer any penalty or be required to take corrective action
or be subject to any form of discipline under the Sex Discrimination Ordinance, the Disability
Discrimination Ordinance, the Family Status Discrimination Ordinance or any other laws
conferring protection against discrimination, harassment, victimisation or vilification by
reason of age, gender, family circumstances, race, religion or disability. There are no
current or (to the best of the knowledge of the Vendor) pending or threatened claims of any
type against it by any existing or former employees.




38









 












	10.3	 	Except as disclosed in the Disclosure Letter, there are no existing service or other
agreements or contracts between the Company and any of its directors or executives or
employees which cannot be lawfully terminated by three calendar months’ notice or less without
giving rise to any claim for damages or compensation other than a statutory redundancy or
severance or long service payment, and the Company has complied with in all material respects
its obligations under all ordinances, statutes and regulations, codes, orders and awards in
connection with its employees and with all collective agreements with respect to trade unions
or to employees of the Company.
	 
	10.4	 	The Company has at all relevant times complied with in all material respects its obligations
under statute or otherwise concerning the health and safety at work of its employees, and, to
the best of the knowledge of the Vendor, there are no claims capable of arising or threatened
or pending by any employee or third party in respect of any accident or injury which are not
fully covered by insurance.
	 
	10.5	 	No term of employment of any employee of the Company provides that a change in control of the
Company (however change of control may be defined, if at all) shall entitle the employee to
treat the change of control as amounting to a breach of the contract or entitling him to any
payment or benefit whatsoever or entitling him to treat himself as redundant or otherwise
dismissed or released from any obligation.
	 
	10.6	 	There are no occupational retirement schemes (within the meaning in section 2 of the
Occupational Retirement Schemes Ordinance), retirement benefits, pension, provident,
superannuation, share option (apart from the existence of the Share Option Scheme under which
no options are outstanding), share incentive, life assurance, disability or similar schemes,
arrangements or obligations for any employees or directors or former employees or directors of
the Company or any of their spouses or dependants. Save the employer’s obligations under the
Mandatory Provident Fund Schemes Ordinance, the Vendor and the Company have no obligation
(whether legally binding or established by custom) to pay any pension, allowance or gratuity
or make any other payment on termination of service, death or retirement or to make any
payment for the purpose of providing any similar benefits to or in respect of any person who
is now or has been an officer or employee of the Company or any spouse or dependant of any
such person and are not a party to any scheme or arrangement having as its purpose or one of
its purposes the making of such payments or the provision of such benefits. The Vendors and
the Company have not announced any proposals to establish any such schemes, arrangements or
obligations.
	 
	10.7	 	Except for the forms of employment contracts already disclosed to the Purchaser, the Company
has no other forms of written contractual agreements/commitments with any employees or
sub-contractors.
	 
	10.8	 	Where personnel has been seconded by other companies or persons to work for any member of the
Group, the relevant member of the Group has fulfilled all the withholding obligations in
relation to such secondees.
	 
	11.	 	The Properties




39









 












	11.1	 	The Company does not own any land, buildings and premises that are currently occupied or used
by the Company.
	 
	11.2	 	The Company has exclusive possession and occupation of the Leased Properties and the leases
in respect of the Leased Properties are valid and enforceable against the respective
landlords.
	 
	11.3	 	The present use of the Leased Properties is in accordance with the relevant leased agreements
for the Leased Properties.
	 
	11.4	 	The Vendor knows of no reason why the existing leases of Leased Properties will not be or are
likely not to be renewed on their expiry on similar terms to those in the existing leases
(save as regards reasonable commercial increases in rent).
	 
	11.5	 	There is no outstanding rent, management or service charge under any lease in respect of the
Leased Properties.
	 
	12.	 	Arrangements with connected persons etc.
	 
	12.1	 	All amounts outstanding and appearing in the books of the Company as loan accounts or as due
to directors or shareholders wholly represent money or money’s worth paid or transferred to
the Company as the case may be or remuneration accrued due and payable for services rendered.
All amounts outstanding between the Vendor or any of its associates and the Company are
specifically disclosed in the Accounts.
	 
	12.2	 	There is not outstanding and there has not at any time been outstanding any contract or
arrangement to which the Company is a party and in which any of the Vendor, its directors or
officers or directors or officers of the Company is or has been interested, whether directly
or indirectly, other than arm’s length service contracts and the Company is not a party to,
nor have its profits or financial position at any time been adversely affected by, any
contract or arrangement which is not of an entirely arm’s length nature, and there is not
outstanding any connected transaction (as such term is defined in Chapter 14A of the Listing
Rules) relating to the Company; save as aforesaid, there are no agreements or understandings
(whether legally enforceable or not) between the Company and any person who is a shareholder
or the beneficial owner of any interest in the Company or any other company controlled by any
such person relating to the management of the Company’s business or the appointment or the
removal of its directors or the ownership or otherwise howsoever relating to the Company or
its affairs.
	 
	12.3	 	All costs incurred by the Company have been charged to the Company and not borne by the
Vendor or its associates.
	 
	13.	 	Matters since the Accounting Date
	 
	 	 	Since the Accounting Date:
	 
	13.1	 	there has been no interruption or alteration in the nature, scope or manner of the Company’s
business which business has been carried on lawfully and in the ordinary and usual course of
business as previously carried on and so as to maintain it as a





40









 











	 	 	going concern;
	 
	13.2	 	there has been no material adverse change in the customer relations of the said business or
in the financial condition or the position, prospects, assets or liabilities of the said
business or the Company as compared with the position disclosed by the Accounts and there has
been no material damage, destruction or loss (whether or not covered by insurance) affecting
the said business or its assets;
	 
	13.3	 	no substantial customer or supplier of the Group for the accounting period ending on the
Accounting Date has ceased or indicated that it is likely to cease trading with or supply to
any member of the Group, or reduced or indicated that it is likely to reduce substantially its
trading with or supplies to any member of the Group or changed or indicated that it is likely
to change substantially the terms upon which it is prepared to trade with or supply any member
of the Group (other than normal price and minor changes);
	 
	13.4	 	the Company has continued to pay its creditors in the ordinary course of business and no
unusual trade discounts or other special terms have been incorporated into any contract
entered into by the Company;
	 
	13.5	 	the Company has not cancelled, waived, released or discontinued any rights, debts or claims;
	 
	13.6	 	the Company has not incurred any capital expenditure or disposed of any fixed assets having a
value of more than HK$1,000,000 in aggregate;
	 
	13.7	 	except as disclosed in the Disclosure Letter, the Company has not hired or dismissed any
employee;
	 
	13.8	 	no sum or benefit has been paid, applied or voted to any officer or employee of the Company
by way of remuneration, bonus, incentive or otherwise in excess of the amounts paid or
distributed to them by the Company at the Accounting Date so as to increase their total
remuneration and no new service agreements have been made or entered into by the Company since
the Accounting Date and the Company is under no contractual or other obligation in respect
thereof nor has the Company changed the terms of service of any officer or employee;
	 
	13.9	 	no dividends, bonuses or other distributions have been declared, paid or made in respect of
any of the Shares.
	 
	13.10	 	no share or loan capital of the Company has been issued or agreed to be issued or any option
or right thereover granted;
	 
	13.11	 	the Company has not undergone any capital reorganisation or change in its capital structure;
	 
	13.12	 	no resolutions have been passed by the Company and nothing has been done in the conduct or
management of the affairs of the Company which would be likely to reduce the net asset value
of the Company;




41









 












	13.13	 	the Company has not made any purchase or sale or introduced any method of management or
operation in respect of the business undertaking or assets of the Company except in a manner
consistent with proper prior practice;
	 
	13.14	 	the Company has not incurred or become subject to any liability or obligation (absolute or
contingent) except current liabilities and obligations incurred under contracts entered into
in the ordinary course of business;
	 
	13.15	 	the Company has not discharged or satisfied any lien or encumbrance or any other obligation
or liability (absolute or contingent) other than liabilities disclosed in the Accounts as at
the Accounting Date and current liabilities incurred since the Accounting Date in the ordinary
course of business; and
	 
	13.16	 	the Company has not acquired or disposed of or granted any right or option or created any
other encumbrance over any shares or securities of any member of the Group or any of the
Properties or any land or buildings or any estate or interest therein or parted with
possession of the whole or any part thereof or agreed to do any of the same.
	 
	14.	 	Accuracy of Information Provided
	 
	14.1	 	All information contained in this Agreement (including the Recitals and Schedule 1) is true
and accurate in all respects and not misleading in any respect.
	 
	14.2	 	All information given to the Purchaser and its professional advisers by the Vendor and its
officers and employees during the negotiations prior to this Agreement was when given and is
at the date hereof true and accurate in all material respects.
	 
	14.3	 	All information contained in the Disclosure Letter is true and accurate in all material
respects and fairly presented and there is no fact or matter which has not been disclosed in
the Disclosure Letter which renders any such information untrue or misleading and there is no
fact or matter concerning the Company and its business and affairs which has not on the basis
of the utmost good faith been disclosed in the Disclosure Letter which would reasonably be
expected to influence the decision of the Purchaser to proceed with the purchase of the Sale
Shares on the terms of this Agreement.
	 
	15.	 	Listing Rules and Related Matters
	 
	15.1	 	The Company has at all times complied with its material obligations under the Listing Rules
and each member of the Group has at all times complied with all laws, rules and regulations
governing companies whose shares are listed on the Stock Exchange in all material respects.
	 
	15.2	 	The Company has not received any notice or warning from the SFC or the Stock Exchange
alleging any breach or failure to comply, by it or any member of the Group, of or with any
aspect of the Listing Rules or any rules, regulations or laws governing or applying to
companies whose shares are listed on the Stock Exchange, and the Vendor knows of no reason why
any such notice might be received or be imminent.




42









 












	15.3	 	No member of the Group and no director or other officer of any member of the Group is now or
has in the preceding three years been involved in any dispute with or any investigation by the
SFC or the Stock Exchange.
	 
	16.	 	Authority
	 
	16.1	 	The Vendor has the power or the corporate power to enter into and perform its obligations
under this Agreement and to carry out the transactions contemplated hereby.
	 
	16.2	 	The Vendor has taken all necessary action or corporate action to authorise the entering into
and performance of this Agreement and to carry out the transactions contemplated hereby, and
this Agreement is a valid and binding obligation on it.
	 
	17.	 	Certain Specific Agreements and Arrangements
	 
	 	 	Where the Group terminates the agreements and arrangements set out in Schedule 5 within
three months from Completion, the aggregate amount payable by the Group under such
agreements and arrangements (including, but not limited to, compensation for termination, if
any) will not exceed HK$1,000,000.






43












 





SCHEDULE 3




Deed of Indemnity




THIS DEED OF INDEMNITY is made on the           day of                               2008




BETWEEN:





	(1)	 	NAM TAI ELECTRONICS, INC., a company incorporated in the British Virgin Islands, whose
registered office is at McNamara Chambers, P.O. Box 3342, Road Town, Tortola, British Virgin
Islands (the “Vendor”);
	 
	(2)	 	the companies whose particulars are set out in the Schedule hereto; and
	 
	(3)	 	HKC (HOLDINGS) LIMITED, a company incorporated in Bermuda, whose registered office is at
Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda (the “Purchaser”).





WITNESSES as follows:





	1.	 	In this Deed unless the context otherwise requires:






	 	1.1	 	the “Agreement” means the agreement made between the Vendor and the Purchaser
on 26 February 2008 for the sale and purchase of the Sale Shares pursuant to which this
Deed has been entered into;
	 
	 	1.2	 	“event” includes (without limitation) any omission, event, action or
transaction whether or not the Company or any of the Subsidiaries is a party thereto,
the death of any person, a change in the residence of any person for any Tax purpose, a
failure to make sufficient dividend payments to avoid an apportionment or deemed
distribution of income and the entering into and completion of the Agreement and
references to the result of events on or before the date hereof shall include the
combined result of two or more events one or more of which shall have taken place
before the date hereof;
	 
	 	1.3	 	“relief” includes (without limitation) any relief, allowance, credit, set off,
deduction or exemption for any Tax purpose;
	 
	 	1.4	 	reference to income or profits or gains earned, accrued or received shall
include income or profits or gains deemed to have been or treated as or regarded as
earned, accrued or received for the purposes of any legislation;
	 
	 	1.5	 	reference to any Tax liability shall include not only any liability to make
actual payments of or in respect of Tax but shall also include the amount of tax losses
which have been disclosed in the Accounts but would not be available after Completion;
	 
	 	1.6	 	reference to the “Company” includes a reference to each of the Subsidiaries;




44









 












	 	1.7	 	reference to a payment in respect of Tax includes (without limitation) a
payment for the surrender or transfer of any relief, a repayment of any such payment
and a payment by way of reimbursement, recharge, indemnity or damages;
	 
	 	1.8	 	words and expressions defined in the Agreement shall have the same meaning, and
any provisions of the Agreement concerning matters of construction or interpretation
shall apply, in this Deed; and
	 
	 	1.9	 	if there is a conflict between the Agreement and this Deed, this Deed prevails
to the extent of the conflict.






	2.	 	Subject as hereinafter provided, the Vendor hereby covenants with and undertake to indemnify
the Purchaser for itself and as trustee for its successors in title and the Company and the
Subsidiaries and each of them and to keep them indemnified against 74.99% in respect of the
Purchaser for itself and as trustee for its successors, or (if so elected by the Purchaser in
which case the Purchaser shall cease to be entitled to pursue any claim hereunder for itself)
100% in respect of the Company and the Subsidiaries, of the following:






	 	2.1	 	any Tax liability of the Company or any of the Subsidiaries resulting from or
by reference to any income, profits or gains earned accrued or received on or before
the Completion Date or any event on or before the Completion Date whether alone or in
conjunction with other circumstances and whether or not such Tax is chargeable against
or attributable to any other person; and
	 
	 	2.2	 	any Tax liability of the Company or any of the Subsidiaries referred to in
Clause 2.1 and which is regarded as such pursuant to the provisions of Clause 1.5; and
	 
	 	2.3	 	any Tax liability of the Company or any member of the Group that arises after
Completion as a result of an act, omission or transaction by a person other than the
Company or any member of the Group (but who were otherwise under control of the Vendor)
and which liability to Tax falls upon the Company or the relevant member of the Group
as a result of its having been in the same group for Tax purposes as that person at any
time before Completion; and
	 
	 	2.4	 	any Tax liability of the Company or any of the Subsidiaries that would not have
been payable had there been no breach of any Tax Warranties and which is not the
subject of the covenants in sub-Clauses 2.1, 2.2 and 2.3 above; and
	 
	 	2.5	 	all costs and expenses which are reasonably and properly incurred by the
Purchaser or the Company or any member of the Group in connection with any of the
matters referred to in this Clause 2 or in taking or defending any action under this
Deed (including, without prejudice to the generality of the foregoing, all legal and
other professional fees and disbursements).






	3.	 	The indemnities given by this Deed do not apply to any liability:




45









 












	 	3.1	 	to the extent that provision or reserve in respect thereof has been made in the
Accounts or to the extent that payment or discharge of such liability has been taken
into account therein;
	 
	 	3.2	 	in respect of which provision or reserve has been made in the Accounts which is
insufficient only by reason of any increase in rates of Tax made after the date hereof
with retrospective effect;
	 
	 	3.3	 	for which the Company is primarily liable as a result of transactions in the
ordinary course of its business or normal day to day trading operations since the
Accounting Date;
	 
	 	3.4	 	in respect of any matter to the extent that the same would not have occurred
but for any matter or thing done or omitted to be done pursuant to and in compliance
with the Agreement or otherwise at the request in writing or with the approval in
writing of the Purchaser, or any act, omission or transaction of the Purchaser or its
directors, officers, employees or agents or successors in title, after Completion,
provided that no member of the Group has ceased to be associated (within the meaning of
section 45(2) of the Stamp Duty Ordinance) with another company or body corporate in
circumstances which might give rise to a liability to stamp duty pursuant to section
45(5A) of the Stamp Duty Ordinance where such stamp duty has not been paid in full
prior to the date hereof and no member of the Group will prior to or at Completion,
whether by virtue of the Agreement or otherwise, cease to be associated (within the
meaning of section 45(2) of the Stamp Duty Ordinance) with another company or body
corporate in circumstances which might give rise to a liability to stamp duty pursuant
to section 45(5A) of the Stamp Duty Ordinance;
	 
	 	3.5	 	to the extent that it arises (or is increased) because of any claim, election,
surrender or disclaimer made or notice or consent given or any other thing done on or
after Completion by a member of the Group or the Purchaser or any of their respective
representatives under the provisions of any legislation relating to Tax, other than
such claim, election, surrender or disclaimer made or notice or consent related to an
event as referred to in Clause 2 and the making, giving or doing of the same is with
the concurrence of the Vendor;
	 
	 	3.6	 	to the extent that it arises (or is increased) because of a failure or omission
on the part of a member of the Group on or after Completion to make any claim,
election, surrender or disclaimer or give any notice or consent or do any other thing
under the provisions of any legislation relating to Tax the making, giving or doing of
which was taken into account in computing the provision for Tax in the Accounts;
	 
	 	3.7	 	to the extent that it arises in respect of accrued gains which relate to the
Company’s period of ownership of the relevant chargeable asset prior to Completion
where the gains are not realised until after Completion;
	 
	 	3.8	 	to the extent that it arises in consequence of a change in the date to which a
member of the Group makes up its accounts or a change of any of its accounting
policies, bases or practices in either case after Completion;




46









 












	 	3.9	 	to the extent that the Tax liability would not have arisen but for a disclaimer
of capital allowances or any other relief or a revision to or revocation of a claim
therefore where such revision or disclaimer is caused or made by the member of the
Group after the Completion Date, other than with the concurrence of the Vendor;
	 
	 	3.10	 	to the extent that the Tax liability arises or is increased as a consequence of
any failure by the Purchaser or a member of the Group to comply with any of their
respective obligations under this Deed;
	 
	 	3.11	 	to the extent that the Tax liability arises or is increased as a result of any
delay or default by the Purchaser or any member of the Group in paying over to any Tax
authority any amount received from the Vendor under this Deed or for breach of the Tax
Warranties;
	 
	 	3.12	 	to the extent that an amount in respect of the Tax liability has already been
recovered by the relevant member of the Group from another person (not being the
Purchaser or a member of the Group);
	 
	 	3.13	 	to the extent that it has been discharged before Completion;
	 
	 	3.14	 	to the extent that it has been made good by insurers or otherwise compensated
for without cost to the Purchaser or the Group; or
	 
	 	3.15	 	to the extent that it would not have arisen but for a cessation of, or any
changes in the conduct of, any trade carried on by a member of the Group at Completion,
being a cessation or charge occurring on or after Completion.






	4.	 	The limitations to the Vendor’s liabilities set out in Clauses 8.12 and 8.13 of the Agreement
shall apply to this Deed, save that such limitations shall not apply to any Tax liability
relating to J.I.C. Enterprises (Hong Kong) Limited.
	 
	5.	 	If the Purchaser shall become aware of any assessment, notice, demand or other document
issued or action taken by or on behalf of any person, authority or body from which it appears
that the Company or any of the Subsidiaries has or may have a liability in respect of which a
claim could be made under this Deed, it shall give written notice thereof to the Vendor and
shall (if the Vendor shall indemnify and secure the Purchaser and the Company and the
Subsidiaries as applicable to the Purchaser’s reasonable satisfaction against any liabilities,
costs, damages or expenses which may be reasonably and properly incurred thereby) take such
action and procure that the Company and/or the relevant Subsidiary shall take such action as
the Vendor may reasonably request to dispute, resist or compromise the liability; provided
that neither the Company nor the relevant Subsidiary nor the Purchaser shall be required to
take any such action which would adversely affect the future conduct of the business of the
Purchaser or the Company or any of the Subsidiaries or any subsidiaries of the Purchaser to a
material extent, or adversely affect the rights of any of them to a material extent, or
adversely affect reputations of any of them.




47









 












	6.	 	The liability of the Vendor under this Deed shall cease after the date falling on the seventh
anniversary hereof except in respect of matters which have been the subject of a written claim
(stating in reasonable detail the specific matters and amount in respect of which such claim
is made) made within the said period by the Purchaser, the Company and/or any of the
Subsidiaries to the Vendor unless the claim in question has arisen by reason of fraud, wilful
concealment or dishonesty on the part of the Vendor or, prior to the date hereof, the Company
or any member of the Group or any of its officers in which event there shall be no contractual
limit on the time period within which such claim may be brought.
	 
	7.	 	The Vendor will not be liable for a claim under this Deed to the extent that an equivalent
claim has been made under the Warranties and the Vendor has satisfied such equivalent claim,
and vice versa.
	 
	8.	 	If the Vendor has made a payment to the Purchaser under this Deed or under the Tax Warranties
and any member of the Group is entitled to recover from any third party (including any Tax
authority) any sum in consequence of any event to which the payment made by the Vendor
relates, and the Vendor agrees to indemnify and secure the Purchaser and the Company and the
Subsidiaries as applicable against any liabilities, costs, fees or expenses which may be
reasonably and properly incurred thereby, the Purchaser shall and shall procure that each
relevant member of the Group shall use all reasonable endeavours to effect such recovery and
the Vendor may require the Purchaser by notice in writing to take and to procure that each
relevant member of the Group takes such action as the Vendor reasonably requests to recover
such sums.
	 
	9.	 	The due date for the making of payments under this Deed shall be:






	 	9.1	 	where the payment relates to a liability of the Company or any of the
Subsidiaries to make an actual payment of or in respect of Tax, the date which is seven
days before the date on which such actual payment is due to be made to the relevant
authority;
	 
	 	9.2	 	where the payment relates to a matter falling within Clause 1.5 (other than an
actual payment), the date falling seven days after the Vendor has been notified by the
Purchaser that the auditors for the time being of the Company or the relevant
Subsidiary have certified at the request of the Purchaser or the Company or the
relevant Subsidiary that the Vendor has a liability for a determinable amount under
Clause 2;
	 
	 	9.3	 	in the case of costs and expenses within Clause 2.5 the date on which such
costs and expenses are incurred; and
	 
	 	9.4	 	where the payment relates to a matter falling within Clause 8 and is required
by the Vendor, within seven days after receipt of any sum so recovered by the Purchaser
which any member of the Group actually recovers less any liabilities, costs, fees or
expenses reasonably and properly incurred by the Purchaser or any member of the Group
in respect of the matter in question.






	10.	 	If any payment due to be made under this Deed is not made on the due date for payment thereof
the same shall carry interest from such due date of payment until




48









 






	 	 	actual payment at the rate of Hong Kong Interbank Offer Rate from time to time of Hong Kong
Bank compounded on the last days of March, June, September and December in each year.
	 
	11.	 	If any sum payable under this Deed shall be subject to Tax (whether by way of deduction or
withholding or direct assessment of the person entitled thereto) such payment shall be
increased by such an amount as shall ensure that after deduction, withholding or payment of
such Tax the recipient shall have received an amount equal to the payment otherwise required
hereby to be made.






	12.	 	The Vendor shall give all such assistance and provide such information as the Purchaser shall
reasonably request from time to time for the purpose of enabling the Purchaser or the Company
any member of the Group to make returns and provide information as required to any Tax
authority and to negotiate any liability to Tax.






	13.	 	No delay or forbearance on the part of any such person in exercising any right power or
privilege under this Deed shall impair such right power or privilege or be construed as a
waiver thereof and any single or partial exercise of any such right power or privilege shall
not preclude the further exercise thereof.






	14.	 	Any notice required to be given by any party hereto to any other shall be deemed validly
served by hand delivery or by prepaid registered letter sent through the post (airmail if to
an overseas address) or by facsimile transmission to its address given herein or such other
address as may from time to time be notified for this purpose and any notice served by hand
shall be deemed to have been served on delivery, any notice served by facsimile transmission
shall be deemed to have been served when sent and any notice served by prepaid registered
letter shall be deemed to have been served 48 hours (72 hours in the case of a letter sent by
airmail to an address in another country) after the time at which it was posted and in proving
service it shall be sufficient (in the case of service by hand and prepaid registered letter)
to prove that the notice was properly addressed and delivered or posted, as the case may be,
and in the case of service by facsimile transmission to prove that the transmission was
confirmed as sent by the originating machine.






	15.	 	If any provision or part of a provision of this Deed shall be, or be found by any authority
or court of competent jurisdiction to be, invalid or unenforceable, such invalidity or
unenforceability shall not affect the other provisions or parts of such provisions of this
Deed, all of which shall remain in full force and effect.






	16.	 	This Deed shall be governed by and construed in accordance with the laws of Hong Kong and the
parties hereto irrevocably submit to the non exclusive jurisdiction of the Hong Kong Courts
for the purposes of enforcing any claim arising hereunder.






	17.	 	The Vendor hereby irrevocably appoints Wilkinson & Grist of 6th Floor, Prince’s Building, 10
Chater Road, Central, Hong Kong as its agent to receive and acknowledge on its behalf service
of any writ, summons, order, judgment or other notice of legal process in Hong Kong. If for
any reason the agent named above (or its successor) no longer serves as agent of the Vendor
for this purpose, the Vendor shall promptly appoint a successor agent satisfactory to the
Purchaser, notify the Purchaser thereof and deliver to the Purchaser a copy of the new process
agent’s acceptance of




49









 






	 	 	appointment Provided that until the Purchaser receives such notification, it shall be
entitled to treat the agent named above (or its said successor) as the agent of the Vendor
for the purposes of this Clause. The Vendor agrees that any such legal process shall be
sufficiently served on it if delivered to such agent for service at its address for the time
being in Hong Kong whether or not such agent gives notice thereof to the Vendor.




IN WITNESS whereof this Deed has been executed and is intended to be and is hereby delivered on the
date appearing at the head hereof.




50









 








SCHEDULE

Details of the Company and the Subsidiaries





	1.	 	J.I.C. Technology Company Limited, a company incorporated in the Cayman Islands whose
registered office is at Cricket Square, Hutchins Drive, P.O. Box 2681, Grand Cayman KY1-1111,
Cayman Islands
	 
	2.	 	J.I.C. (Macao Commercial Offshore) Company Limited, a company incorporated in Macau
whose registered office is at Unit D, 17th Floor, Edificio Comercial Rodrigues, 599
da Avenida da Praia Grande, Macau
	 
	3.	 	Best Whole Holdings Limited, a company incorporated in Hong Kong whose registered
office is at Suites 1506-1508, One Exchange Square, 8 Connaught Place, Hong Kong
	 
	4.	 	Joy Holdings Limited, a company incorporated in British Virgin Islands whose
registered office is at P.O. Box 957, Offshore Incorporations Centre, Road Town, Tortola,
British Virgin Islands
	 
	5.	 	J.I.C. Enterprises (Hong Kong) Limited, a company incorporated in Hong Kong whose
registered office is at Suites 1506-08, One Exchange Square, 8 Connaught Place, Central, Hong
Kong
	 
	6.	 	Shenzhen Namtek Company Limited, a company incorporated in the PRC whose registered
office is at 
	 
	7.	 	Kabushiki Kaisha Namtek Japan (expressed in English as Namtek Japan Co., Ltd.), a
company incorporated in Japan whose registered office is at 6th Floor,
Sakura-Masamune, Higashi-Nihonbashi Building, 3-12-12 Higashi-Nihonbashi, Chuo-Ku, Tokyo




51









 











	 	 	 
	THE COMMON SEAL of
	 	)
	NAM TAI ELECTRONICS, INC.
	 	)
	was hereunto affixed
	 	)
	in the presence of:
	 	)
	 
	 	 
	THE COMMON SEAL of
	 	)
	HKC (HOLDINGS) LIMITED
	 	)
	(for and on behalf of itself and
	 	)
	the companies set out in the
	 	)
	Schedule as trustee)
	 	)
	was hereunto affixed
	 	)
	in the presence of:
	 	)






52









 






SCHEDULE 4




Letter of Resignation under Seal




To: The Board of Directors of [•]




Dear Sirs,



[I/We] hereby resign as [a director]/[the company secretary] [and employee] of [•] with
immediate effect and hereby confirm that [I/We] have no claim outstanding against [•] for
compensation for loss of office or otherwise.



Dated this           day of                               2008.




	 	 	 
	SIGNED SEALED and DELIVERED
	 	)
	as a Deed by [name of person]
	 	)
	in the presence of:
	 	)





The original of this letter of resignation has been posted to [or left] at the [registered office]
/ [principal place of business] of the company on [•].





53









 








SCHEDULE 5




Agreements and arrangements relating to the employees or the affairs of the Group as referred to in

paragraph 17 of Schedule 2




The Company





	1.	 	The arrangement of sharing of total overheads of office space at Suites 1506-1508,
15th Floor, One Exchange Square, 8 Connaught Place, Central, Hong Kong (for an
amount of US$24,000 per month) between the Company and ZPT, as approved in the Company’s board
resolutions dated 23 December 2005.






	2.	 	The Company’s sharing of costs incurred for Changeover Project with two other parties under a
Consultancy Agreement entered into among the Hong Kong Productivity Council, ZPT and NTEEP, as
approved in the Company’s board resolutions dated 28 May 2007.
	 
	3.	 	Employment agreements of two employees, namely, Chan Bo Shan and Yuen Yee Ling, Elaine.




Kabushiki Kaisha Namtek Japan (expressed in English as Namtek Japan Co., Ltd.) (“Namtek Japan”)






	4.	 	Retirement of Mr. Kazuhiro Asano (Namtek Japan shall not be liable to pay any amounts to Mr.
Asano for such purpose apart from a severance pay which shall not be more than JPY2,925,000.)




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	SIGNED by John Farina	 	)	 	 	 	 
	for and on behalf of	 	)	 	/s/ John Q. Farina	 	 
	NAM TAI ELECTRONICS, INC.	 	)	 	 	 	 
	in the presence of:	 	)	 	 	 	 
	 
	 	Jeckle Chu	 	 	 	 	 	 
	 
	 	JSM	 	 	 	 	 	 
	 
	 	in association with Mayer Brown LLP	 	 	 	 	 	 
	 
	 	and Mayer Brown International LLP	 	 	 	 	 	 
	 
	 	Solicitor, Hong Kong SAR	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	SIGNED by Eric Oei	 	)	 	 	 	 
	for and on behalf of	 	)	 	/s/ Eric Oei	 	 
	HKC (HOLDINGS) LIMITED	 	)	 	 	 	 
	in the presence of:	 	)	 	 	 	 
	 
	 	James Chan	 	 	 	 	 	 
	 
	 	/s/ James Chan	 	 	 	 	 	 







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