Share Subscription Agreement

SHARE SUBSCRIPTION AGREEMENT THIS AGREEMENT IS MADE ON  ______ TH DAY OF _________, 2006.

BETWEEN

THE COMPANY : COMPANY 1 ________________________________________________________ ____________________________
AND
THE AGENT : COMPANY 2 Hadi Mansion (6th &7th Floors) 2, Dilkusha C/A Dhaka-1000
AND
THE SUBCRIBERS : _______________________________ _______________________________
AND
THE ACCOUNT BANK :

WHEREAS: I.                    The Company is incorporated as a limited public company with an authorized capital of Tk. ________________ (_________________) only divided into _______________ (______________) ordinary shares of Tk.100.00 (one hundred) each and 2,500,000 (Two million five hundred thousand) cumulative redeemable preference shares of Tk. 100.00 (Taka one hundred) each.

II.                 The Company is authorised and proposes to allot and issue 2,500,000 (Two million five hundred thousand) cumulative redeemable preference shares of an aggregate value of Tk. 250,000,000.00 (Taka two hundred fifty million) only (the “Issue Price”) and the nominal value of each cumulative redeemable share is Tk. 100.00 (Taka one hundred) only with all rights, privileges and conditions attached thereto in accordance to the Articles of Association of the Company (the “Preference Shares”).

III.               Pursuant to the terms of this Agreement and the Put Option Agreement, the Subscribers (as defined hereunder) have agreed to subscribe the Preference Shares of the Company.

IV.              The parties hereto agree that the issue and allotment of shares to the Subscribers will be governed by the terms and conditions of this Agreement set forth hereunder.

NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL TERMS, COVENANTS AND BENEFITS, THE PARTIES HERETO AGREE AS FOLLOWS:

1. DEFINITION

1.1              Unless otherwise stipulated, the capitalised expressions hereunder shall have the meaning as ascribed to them under this Clause.

i. ‘Accounts’ means the Redemption Reserve Account and the Central Account to be opened with Account Bank pursuant to the Accounts Agreement.

ii.  ‘Accounts Agreement’ means the Accounts Agreement dated on and about this date between the Account Bank, the Subscribers and the Company.

iii.  Central Account” means bank account opened by the Company with the Account Bank under the terms and conditions set forth in Accounts Agreement.

iv.  ‘Closing Date’ shall be on _________ or the parties may determine such other date as hereto.

v. “Date of Allotment” shall mean for the purpose of this Agreement, the date when the Company receives the Issue Price for the Preference Shares subscribed by the Subscribers and each Subscriber has received their respective share certificates [letter of allotment] for the Preference Shares so subscribed by the Subscriber.

vi.  “Dividend Payment Date” means the first Dividend Payment Date falling on the third anniversary of the [Date of Allotment], and thereafter every subsequent anniversary of the last Dividend Payment Date until redemption of all the Preference Shares. Provided that, if the Company declares dividend prior to the first Dividend Payment Date stipulated in the foregoing, the date when the Company receives the first declared dividend shall be deemed to be the first Dividend Payment Date.

vii.“Gross Preferential Dividend” means the dividend of the Preference Shares as stipulated in clause 7.1 of this Agreement. viii.              “Issue Price” means the total aggregate consideration of the Preference Shares equivalent to a sum of Tk. 250,000,000.00 (Taka two hundred fifty million) only.

ix. “Net Preferential Dividend” means the Gross Preferential Dividend after deduction of 15% withholding tax charges and other charges applicable which is payable to each Subscriber.

x.  ‘Notice for Subscription and Payment’ means a notice requesting the Subscribers to subscribe for the Preference Shares and to make payment of such Preference Shares substantially in the form set out in Schedule D.

xi.  “Preference Shares” means the 2,500,000 (Two million five hundred thousand) Cumulative Redeemable Preference Shares with a maturity of 5 (five) years to be subscribed by the Subscribers under the terms and conditions of this Agreement, the Put Option Agreement and the Articles of Association of the Company or any part thereof.

xii.   “Put Option Agreement” means the Put Option Agreement dated on or about this date between the Subscribers and the Sponsors. xiii.   “Redemption Payment Date” means the date stipulated in Schedule B for redemption of the relevant Preference Shares. xiv.              ‘Redemption Reserve Account’ means bank account opened by the Company with the Account Bank under the terms and conditions set forth in Accounts Agreement.

xv.  “Redemption Amount” means the amount payable by the Company to the Subscribers for redeeming the Preference Shares as stipulated in Schedule B hereunder.

xvi.  “Sponsors” means: Mr. A ,son of  ________________, of House No. 4, Road …………….. Mr. B, son of _________________, of House No. 4, Road Mr. C , son of    _________________, Mr. D, son of _________________, of 91/99 Mr. E , son of ________________, of 91/99 xvii.            “Redemption Schedule” means the redemption schedule provided in Schedule B pursuant to redemption under Clause 7.3. xviii.           “Subscribers” means ________________________ and any transferees or assigns. xix. “Tax Change”means any change in the rules, regulations, directions and laws of the People’s Republic of Bangladesh relating to the rate or basis of the taxation.

2. ISSUE OF CUMULATIVE REDEEMABLE PREFERENCE SHARES

2.1              Pursuant to the terms and conditions of this Agreement and the Put Option Agreement and upon receipt of the Issue Price, the Company shall allot and issue the Preference Shares to the Subscribers and the Subscribers shall subscribe to the numbers of Preference Shares as set forth in Schedule A attached hereto.

3.         CONDITIONS PRECEDENT:

3.1       The Company shall fulfill of the following pre-conditions at least _________ days prior to the Closing Date: i)                    the Agent has received : (a)    a copy of the Certificate of Incorporation and (ii) the latest copy of the Memorandum and Articles of Association, and (iii) a copy of last Annual Return (Schedule Particulars of Directors (Form XII); (b)   Approval by the Board of Directors of the Company calling an Extra Ordinary General Meeting for amendment of the Articles of Association of the Company for facilitating the issue of Preference Shares; (c)    Special Resolution of the shareholders of the Company approving the amendment of the Articles of Association of the Company for facilitating the issue of Preference Shares and waiving all pre-emptive rights filed with the Registrar of the Company within 15 days from the date of such resolution; (d)   Approval by the Board of Directors of the Company for: A)    Issuing and allotment of 2,500,000 (two million five hundred thousand) Cumulative Redeemable Preference Shares to the Subscribers on the terms and conditions of the Memorandum and Articles of Association of the Company, the Subscription Agreement and the Put Option Agreement; and B)     Authorising such person(s) to execute the Subscription Agreement, the Put Option Agreement and such other agreement, documents and deeds in contemplation thereto for and on behalf the Company; and C)    Authorising such person(s) to sign, seal and deliver the share certificates of the Preference Shares to the Subscribers for and on behalf the Company; (e)    Specimen signatures of the Authorised signatories of the Company; (f)     Evidence that the Company has obtained all governmental and other authorisations, approvals, licences, consents and exemptions of, and made all declarations to, governmental and other regulatory authorities and agencies necessary for the issue of the Preference Share, execution and performance by the Company of this Agreement and other documents in connection thereto, including and not limited to the permission or approval of the Securities and Exchange Commission; (g)    Execution of the Put Option Agreement; (h)    Clean and clear CIB Report of the Company; and (i)      Opening of the Redemption Reserve Account and the Central Account with the Account Bank in accordance with the Accounts Agreement.

3.2           The Subscribers shall not be bound to subscribe to and pay for the Preference      shares under this Agreement unless: a.       the pre-conditions in the foregoing Clause 4.1 are complied with by the Company to the full satisfaction of the Subscribers; b.      there is no breach of the terms of this Agreement, the Put Option Agreement or any other documents in connection herewith; and c.       the representation and warranties hereunder are effective, continuing and binding on the Company.

4.         THE ISSUE PRICE:

4.1       Subject to: 4.1.1   the prior satisfaction of the provisions of Clause 3;

4.1.2 the representations and warranties set out in Clause 9 being correct on and as of the date of issue of the Notice for Subscription and Payment as though made on and as of such date; and

4.1.3  the covenants set out in clause 8 being correct on and as of the date of such Issue Price as though made on and as of such date, the Company may, for subscription of the Preference Shares and payment of the Issue Price, serve on the Agent in writing a Notice for Subscription and Payment, to be actually received by the Agent not later than 10.00 hours Dhaka time 7 (seven) Business Days including the day of issuing the notice, before the proposed date of subscription of the Preference Shares and payment of the Issue Price. The subscription of the Preference Shares and payment of the Issue Price shall take effect not later than the Closing Date.

4.2           Upon receipt of a valid Notice for Subscription and Payment duly completed and in compliance to the term herein, the Agent shall notify each of the Subscribers the proposed date for subscription of the Preference Shares by each of the Subscribers and the amount of the Issue Price each such Subscribers shall make available to the Agent on the due date of payment for the Preference Shares subscribed by such Subscriber, subject to the provisions of this Agreement.

4.3           The Notice for Subscription and Payment shall be irrevocable and the Company shall avail the Issue Price on the date stated in the Notice.

5.         CLOSING DATE

5.1       On the Closing Date: a.       The conditions under the provision of clause 3 have been fulfilled. b.      The Company has received the Issue Price under the terms of clause 4. c.       The Company shall deliver to each of the Subscriber the duly sealed and executed share certificates [letters of allotment] for the Preference Shares subscribed by such Subscriber. d.      The Company shall enter the names of each of the Subscribers as preference shareholders of the Company with such other relevant details in the Register of Members of the Company and furnish the Subscribers each with a copy of such registration.

6          POST-CLOSING OBLIGATIONS

6.1              The Company shall within sixty (60) days of the allotment of Preference Shares file the returns of allotment to the Registrar of Joint Stock Companies and Firms and provide a copy of such filing with the delivery receipt to each of the Subscribers for their record. [6.2    The Company shall within ________ days shall deliver to each of the Subscriber the duly sealed and executed share certificates for the Preference Shares subscribed by such Subscriber.]

7. DIVIDEND AND REDEMPTION OF THE PREFERENCE SHARES

7.1              The Gross Preferential Dividend for each issued Preference Share shall be 10% of face value of such Preference Share. The Company shall pay the Subscriber the Net Preferential Dividend for each issued Preference Shares on the Dividend Payment Dates.

7.2              The payment of dividend for the Preference Shares shall be made on the Dividend Payment Dates regardless of whether the Company declares dividends for its ordinary shares for any given year (whether financial or business).

7.3              The Preference Shares shall have the maximum maturity period of 5 (five) years from the [Date of Allotment] and shall be redeemed on the Redemption Payment Dates in the manner set-forth in the Redemption Schedule.

7.4              Subject to Clause 7.6 hereunder, any Net Preferential Dividend unpaid on any Dividend Payment Date shall be carried forward and be payable on the next Dividend Payment Date until the Preference Shares are fully redeemed.

7.5              All payments made by the Company upon redemption of the Preference Shares shall remit directly to each Subscriber on the Redemption Payment Date to the designated accounts of the Subscribers listed in Schedule C hereunder.

7.6              As long as the Subscribers hold any Preference Shares, nothing in this Agreement shall prejudice or extinguish the Subscribers’ right to require the Sponsors to purchase all or any of the Preference Shares under the terms and conditions of the Put Option Agreement.

7.7              Not less than 14 (fourteen) days before each Redemption Date the Company shall serve on each of the Subscriber a written notice stating the number of Preference Shares to be redeemed on the relevant Redemption Date and the Redemption Amount payable (in accordance to Schedule B) by the Company to such Subscriber, and requiring the Subscriber to lodge with the Company the share certificates in respect of Preference Shares to be redeemed.

7.8              Each Preference Share shall be redeemed on the Redemption Payment Date and the Company shall pay to the Subscriber the full Redemption Amount on such date.

8.        COVENANTS OF THE COMPANY

8.1       The Company shall:

i.  upon each allotment immediately register the allotment in the appropriate corporate books of the Company and if requested, furnish the Agent with a copy of such registration, and

ii.   within sixty (60) days from the date of allotment of the Preference Shares file the returns for allotment with the Registrar of Joint Stock Companies and Firms.

8.2 The Company hereby undertakes to initiate an IPO within ______ (______) year/month/days from the date of _______________________ subject to approval from the Security and Exchange Commission (SEC) and approval of the prospectus by the Subscribers provided that the Company shall under no circumstances delay its application to SEC and do such deeds, acts and things as to render its application or prospectus to be rejected.

8.3  The Company shall deposit the prospectus to the Agent by ____________ for issuance of IPO within ____________.

9.        REPRESENTATIONS AND WARRANTIES

9.1       The Company hereby makes each of the following representations and warranties for the benefit of the Subscribers and the Subscribers has on reliance of the following representation and warranties agreed to subscribe the Preference Shares:

a) The Company is a public limited company duly organised and validly existing under the laws of the People’s Republic of Bangladesh and has full corporate power and authority to own its properties and to carry on its businesses all as, and in the places where, such properties are now owned or operated or such businesses are now being conducted.

b)  The Company has full legal right, power and authority to enter into this Agreement and to allot and issue the Preference Shares to the Subscribers pursuant to and in accordance with this Agreement.

c) The execution, delivery and performance of the terms and conditions and the obligations of this Agreement by the Company will not (i) violate or contravene any provision of any applicable law by which the Company is bound, (ii) violate, conflict with, or result in the breach of, any provisions of the Memorandum of Association or the Articles of Association of the Company, or (iii) conflict with, or result in the material breach of any provision of any agreement, instrument or other obligation or commitment to which the Company is a party or by which it or any of its properties or assets is bound.

d) As of the date of this Agreement, the Company has an authorised capital of Tk. ______________  (Taka ___________________), divided into ______________ (_________) ordinary shares of Tk. 100.00 (Taka one hundred) each and ___________ (______________) redeemable preference shares of Tk. 100.00 (Taka one hundred) each and an issued and paid up capital of Tk.  _____________ (_______________) divided into ___________ (____________) ordinary shares of Tk. 100 (Taka one hundred) each.   Upon the full subscription of the Preference Shares under this Agreement, the Company will have an issued and paid up capital of Tk. _____________ (Taka __________________) divided into ___________ (________________) ordinary shares of Tk. 100.00 (Taka one hundred) each and ___________ (_________________) redeemable preference shares of Tk. 100.00 (Taka one hundred) each. e.                   When issued to the Subscribers pursuant to this Agreement, each Preference Share will be duly and validly authorised, allotted and issued and will not be subject to any liens and encumbrances, and upon subscription the Subscribers will own all rights, title and interest in such Preference Share and be entitled to exercise all rights attached or accruing to such Preference Shares, including and not limited to the right to dispose off the Preference Shares or any part thereof by way of selling or transfer to other parties subject to the Articles of Association of the Company and existing rules and regulations of the Securities and Exchange Commission.

f. The Company has not transferred or sold any part of the assets and properties prior to the next Annual General Meeting except in the ordinary course of business and the Company has not entered into any material transaction outside the normal course of usual business operation as of the date of signing of this Agreement.

g.There is no pending or threatened proceeding for the dissolution, liquidation and insolvency of the Company, whether voluntary or involuntary.

h.  There has not been any material adverse change in the financial condition of the Company since date of the latest accounts which in the reasonable opinion of the Subscribers would be likely to adversely affect the Company’s ability to meet its financial obligations towards the Subscribers.

9.2   The Subscribers hereby individually and collectively make each of the following representations and warranties for the benefit of the Company:

a.   The Subscribers are financial institutions duly organised and validly existing under the laws of the People’s Republic of Bangladesh and have full corporate power and authority to own their properties and to carry on their businesses all as, and in the places where, such properties are now owned or operated or such businesses are now being conducted.

b.  The Subscribers have full legal right, power and authority to enter into this Agreement and to subscribe for them Preference Shares pursuant to and in accordance with this Agreement.

10.  TAXES

10.1     The Company shall be responsible for and shall pay all taxes, duties, levies, imposts, fees, assessments and charges of any nature, levied, imposed, assessed or charged by any government entity imposed upon the Company as a consequence of any transaction pursuant hereto or contemplated by this Agreement.  For the avoidance of doubt, it is understood and agreed that the Company shall be entitled to deduct or withhold from any payment payable to the Subscribers hereunder any sums required by any government entity to be deducted or withheld, and the Company shall provide the Subscribers with evidence of such deductions or withholdings as required by applicable law.

10.2     The Subscribers shall be responsible for and shall pay all taxes, duties, levies, imposts, fees, assessments and charges of any nature, levied, imposed, assessed or charged by any government entity imposed upon the Subscribers as a consequence of any transaction pursuant hereto or contemplated by this Agreement.

11.     TAX CHANGE

11.1   Notwithstanding anything herein, the Company and the Subscribers agree that in the event of a Tax Change:

i)  resulting in a decrease in the amount payable as Net Preferential Dividend, the Gross Preferential Dividend shall be adjusted upward to cover such decrease in the Net Preferential Dividend and to ensure that the Net Preferential Dividend shall not vary from the amount payable by the Company in accordance to the terms of this Agreement if such Tax Change had not occurred. Provided that such upward adjustment shall be effective on a next succeeding Dividend Payment Date after the relevant Tax Change, or

ii) resulting in an increase in the amount payable as Net Preferential Dividend, the Gross Preferential Dividend shall be adjusted downward to cover such increase in the Net Preferential Dividend and to ensure that the Net Preferential Dividend shall not vary from the amount payable by the Company in accordance to the terms of this Agreement if such Tax Change had not occurred. Provided that such downward adjustment shall be effective on a next succeeding Dividend Payment Date after the relevant Tax Change, 12 TERM

AND TERMINATION

12.1 This Agreement shall become effective on the date hereof and shall, subject to Clause 12.2, continue in full force and effect until the Company’s redemption of the Preference Shares and receipt of Redemption Amount.

12.2   Prior to full subscription of the Preference Shares, the Subscribers may terminate this Agreement forthwith by notice in writing to the Company upon any material breach of the provisions of this Agreement or the Put Option Agreement, provided such breach has not been remedied within 5 (Five) days of the receipt of a written notice from the Subscribers initiating the termination by notifying the Company of such breach.

12.3  Any termination or expiration of this Agreement howsoever caused shall not affect any rights or liabilities of the parties which have accrued prior to the date of termination or expiration.

12.4 All provisions of this Agreement, which by their terms are intended to survive the termination or expiration of this Agreement, will continue thereafter in full force and effect in accordance with their terms.

13. INDEMNIFICATION AND OTHER REMEDIES

13.1  The Company shall indemnify the Subscribers, and hold the Subscribers harmless from and against any and all losses, liabilities, damages, claims, penalties, actions, judgements, suits, costs, expenses, and disbursements (including, without limitation, the reasonable fees and disbursements of counsel and incurred in connection with the enforcement of any provisions of this Agreement or the defence of any third-party claim) which may be incurred by the Subscribers as a result of, or directly or indirectly arising out of the breach of any of the representations and warranties, covenants, agreements or obligations contained in this Agreement.

14.       NOTICE

14.1     Any notice or other communications required or permitted hereunder shall be sufficiently given if delivered in person or sent by registered or certified mail, postage prepaid, or via facsimile, receipt confirmed, addressed as follows: If  to the Company:                              X Limited __________________ __________________ __________________ Attention: Telephone: Facsimile: If to the Subscribers:                            _______________________ _______________________ _______________________ _______________________ Attention: Telephone: Facsimile: _______________________ _______________________ _______________________ _______________________ Attention: Telephone: Facsimile: or such other address as shall be furnished in writing by any such party, and such notice or communication, if not actually delivered earlier, shall be deemed to have been delivered as of the date so delivered in person, the date of transmission by facsimile (provided that a hardcopy of such transmission despatched to the other party with three (3) days from the date of transmission),  receipt confirmed, or within 3 (Three) days after dispatch, if dispatched by registered or certified mail.

15. COSTS AND EXPENSES

15.1     The following expenses shall be on account of the Company:

a.       all stamp duties, registration fees and other governmental charges, levy incurred or assessed on or in respect of this Agreement, the Put Option Agreement and/or any other documents contemplated thereby;

b.      all other reasonable costs, charges, expenses and legal fees in relation to this Agreement, the Put Option Agreement and/or any other documents contemplated thereby, including legal fees expended by the Subscribers in enforcement of this Agreement and the Put Option Agreement.

16.       MISCELLANEOUS

16.1       This Agreement shall inure to the benefit of and be binding upon the Parties hereto and their respective successors and permitted assigns. No Party may assign this Agreement or the rights hereunder without the prior written consent of the other Parties.

16.2   The rights of the parties under this Agreement are cumulative, and may be exercised as often as the parties consider appropriate and are in addition to their respective rights under applicable law.  The rights of the parties shall not be capable of being waived or varied otherwise than by an express waiver or variation in writing, and, in particular, any failure to exercise or any delay in exercising any of such rights shall not operate as a waiver or variation of that or any such other right; any defective or partial exercise of any of such rights shall not preclude any other exercise of such rights; and negotiation by the parties or on behalf of the parties shall not in any way preclude the parties from exercising any such other right or constitute a suspension or any variation of any such right.

16.3  This Agreement may be amended only by a written instrument, executed by the parties to this Agreement.

16.4       If any provision of this Agreement is deemed illegal, invalid or unenforceable, such illegality, invalidity, or unenforceability shall not affect the legality, validity and enforceability of any other part of this Agreement, which shall be construed as if such illegal, invalid or unenforceable provision (or provisions) had not been inserted in this Agreement, unless the severability of such illegal, invalid or unenforceable part would destroy the underlying business purposes of this Agreement in which case the Parties shall negotiate in good faith to substitute such illegal, invalid or unenforceable provision (or provisions) with a legal, valid and enforceable provision (or provisions) which carries out the original intent of the parties.

17        GOVERNING LAW AND DISPUTES

17.1     The construction, validity and performance of this Agreement shall be governed in all respects by the laws of the People’s Republic of Bangladesh.

17.2          Any dispute, controversy or claim arising under this Agreement or related thereto shall, insofar as is possible, be settled amicably by the Parties.  The Parties agree to negotiate in good faith to settle any such disputes.

17.3          Any dispute, controversy or claim arising under this Agreement or related thereto which cannot be amicably settled by the Parties shall be settled by arbitration.  The arbitration shall be conducted in Dhaka, Bangladesh in accordance with the provisions of the Arbitration Act, 2001. The award rendered by the arbitrator shall be final and binding on the Parties and may be entered in any court of competent jurisdiction for execution.

IN WITNESS WHEREOF the parties, above named have signed and sealed this Agreement of the day, month and year written above. Signed, sealed and delivered in Dhaka.

For: THE AGENT

COMPANY 2  COMPANY OF BANGLADESH LIMITED___________________
Witnessed by: ___________________
For: THE SUBSCRIBERS ___________________
Witnessed by: ___________________
For: COMPANY 1 __________________
Witnessed by: ___________________

Drafted by: SCHEDULE A – PARTICIPATION IN THE ISSUE PRICE BY SUBSCRIBERS

Sl. Subscribers Participation in the Issue Price Preference Shares to be held

SCHEDULE B – REDEMTION OF THE ISSUE SHARES Redemption Schedule

Redemption Date No. of Preference Shares to be redeemed Redemption Amount (Taka)

SCHEDULE-C

Subscribers Name of the Bank Account No.

(In the letterhead of the Company)

SCHEDULE D – NOTICE FOR SUBSCRIPTION OF PREFERENCE SHARES AND PAYMENT OF ISSUE PRICE To:

X Leasing Company of Bangladesh Limited as Agent BDT …………………… Share Subscription Agreement dated _____________. We refer to the subscription of 2,500,000 preference shares (the Preference Shares) by a Agreement (the ‘Subscription Agreement’) dated ______________ and made between COMPANY 1  (the ‘Company’) and the Agent and Subscribers named therein.  Terms defined in the Subscription Agreement have the same meanings herein. We hereby: (i)         give you notice that we wish to issue the Preference shares to the Subscribers upon payment of the total Issue Price amounting to Tk. 250,000,000.00 (Taka two hundred fifty million) only  on ………….. 200….. (ii)        request you to pay the Issue Price to [name and address of bank to which remittance is to be made and account number]; and (iii)       confirm that as at today’s date each of the conditions contained in Clause 3 is satisfied and we know of no reason why they should not be satisfied as at the date referred to in (i) above. X Limited By ………………………………… Drafted by:

For: “The Lawyers & Jurists”
M.L.Hotel Tower Ltd,208,Shahid Syed Nazrul Islam Sarani,
Bijoy Nagar, Dhaka-1000.
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