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ASSOCIATION AGREEMENT between COMPREHENSIVE INVESTMENTS CC REG. NO. 2001/016051/23 t/a BUSINESS-LINK a close corporation within the meaning of the Close Corporations Act, 1984 and its members PETRO FOURIE DANIE VISSER DICK WETLEGG 1. DEFINITIONS In this agreement, unless the context clearly indicates a contrary intention: 1.1 An expression which denotes: 1.1.1 the singular shall include the plural and vice versa 1.1.2 any gender shall include the other genders 1.2 "The Act" shall mean the Close Corporations Act, 1984; 1.3 "The corporation" shall mean Comprehensive Investments CC t/a Business-Link; 1.4 "The members" shall mean the members for the time being of the corporation; 1.5 "Schedule I" shall mean the schedule annexed as schedule I to this agreement which is for the time being in force in terms of 2; 1.6 "Schedule II" shall mean the schedule annexed as schedule II to this agreement which is for the time being in force in terms of 4; 1.7 Expressions defined in the Act shall bear the meanings therein assigned to them; 1.8 References to sections shall be construed as referring to sections of the Act; 1.9 A resolution of members shall mean a resolution duly passed at a meeting of the members of the corporation, or a written resolution signed by all members. 1.10 "Schedule III" shall mean the schedule annexed as schedule III to this agreement which is for the time being in force in terms of 6 and 7. 2. BINDING EFFECT 2.1 This agreement shall be and remain binding on the members, notwithstanding any alteration in their respective interests or any change in the membership of the corporation, whether by the admission of a new member or the termination of the membership of an existing member. 2.2 This agreement shall be signed in as many counterparts as a number one in excess of the number of members (and accordingly, upon any increase in the number of members taking place, the appropriate number of additional counterparts of this agreement shall be signed), and: 2.2.1 the counterpart stamped as the original of this agreement shall be retained by the corporation; and 2.2.2 each member shall retain a counterpart of this agreement in his possession. 2.3 Upon any change in the interests of the members or the composition of the membership of the corporation taking place: 2.3.1 the members shall complete and sign (in as many counterparts as may be required) a schedule I in force immediately prior thereto, and shall reflect the particulars or changes in the particulars required by schedule I; 2.3.2 the members shall submit their counterparts of this agreement to the corporation for the addition thereto of the amended schedule, which shall thereupon be returned to them; and 2.3.3 the affected member/s shall return to the corporation the certificate issued to him in terms of section 31 for cancellation and, if applicable, the issue of an amended certificate reflecting the changed interest/s. 2.4 Any schedule I which is replaced in terms of 2.3 shall remain bound with or otherwise attached to this agreement for evidential purposes. 3. CONTRIBUTIONS AND INTERESTS 3.1 Each of the members shall make, or in the case of a member become such by virtue of the acquisition of an interest from an existing member, shall be deemed to have made, the contribution ascribed to him in schedule I. 3.2 The members approve and confirm the value ascribed in schedule I to any member's contribution consisting of property or of services rendered in connection with and for the purposes of the formation and incorporation of the corporation. 3.3 The interests of the respective members in the corporation shall be those ascribed to them respectively in schedule I. 4. MANAGEMENT 4.1 The management of the business of the corporation shall be vested in the members described in schedule II as the members, each of whom shall be employed by the corporation with effect from the date, for the remuneration and upon the further terms and conditions of schedule II. 4.2 The employment of each member shall be terminable by him or by the corporation by the giving to the other of them of not less than one month's written notice of the termination of such employment, provided that the corporation shall have the right summarily to terminate the employment of any such member upon any ground justifying such summary termination at the common law of master and servant. 4.3 In the event of any change in the identity of the members or in the remuneration or other terms and conditions of employment, the members shall complete and sign a schedule which shall replace the schedule II in force immediately prior thereto, and shall reflect the particulars or changes in the particulars required by schedule II. 4.4 Any schedule II which is replaced in terms of 4.3 shall remain bound with or otherwise attached to this agreement for evidential purposes. 4.5 All of the members shall devote the whole of his time and attention during normal working hours or as much time as may be decided upon by the members, and such reasonable additional time as may be required by the exigencies of the corporation's business, to the business and affairs of the corporation, and shall use his best endeavours, in conformity with the capacity in which he is employed by the corporation, to promote and extend the business and interests of the corporation. 4.6 As between the members and the corporation, all of the members shall have the power to represent the corporation and/or be involved in its day to day running. 4.7 The power of the members to represent the corporation shall be restricted in the manner and to the extent set forth in schedule II. 4.8 The names of the members, stating their designations as such shall be mentioned in all documents upon which the name of the corporation is required to be mentioned in terms of section 23(1)(b). 5. MEETINGS 5.1 Any member shall have the right, by written notice to the member designated as secretary in schedule II, to require that a meeting of members be convened for any purpose stated in that notice, and the secretary shall give notice convening such meeting not later than three days after his receipt of such requisition, for a date not more than five days after his receipt of such notice. 5.2 Unless the members unanimously agree to the holding of a meeting on shorter notice and/or without written notice, any meeting of members of the corporation, whether convened by a member in terms of section 48(1) or upon the requisition of a member in terms of 5.1 shall be convened by not less than three business days written notice to all the members. 5.3 Unless all the members otherwise agree, every meeting of members of the corporation shall be held at the venue stated in schedule I. 5.4 The quorum necessary for the transaction of business at any meeting of the corporation shall be the number of members having, in aggregate, the percentage of the total voting rights of all members, stated in schedule I; provided that if such number or percentage is not stated, the number shall be simple majority in number of members of the percentage shall be a simple majority of the total voting rights of all members, as the case may be. 5.5 Any member shall have the right to appoint a proxy, who need not be a member, to attend, speak and vote on behalf of the member concerned at any meeting of the members. The appointment of a proxy shall not preclude the attendance at such meeting of the member appointing such proxy, and if he attends, he shall have the right to vote to the exclusion of his proxy. An instrument appointing a proxy shall not be valid or effective unless it is received at the registered office of the corporation not less than twenty four hours before the time appointed for, or lodged at the venue of the meeting at the commencement of the meeting to which it relates and contains a secrecy and/or trade restraint clause duly worded by the members and applicable to and agreed to by the proxy in writing. An instrument appointing a proxy shall be signed by the appointer and may be in any form, provided that the appointment is for attendance at a specific meeting and does not curtail the power of the proxy to represent his principal. 6. DISPOSAL OF INTERESTS ON DEATH 6.1 For the purposes of this paragraph 6, the value of the interest of each member shall be as set out in schedule III attached hereto. 6.2 Upon signature of this agreement, if the members so resolve, the members and/or the corporation shall take out or increase or reduce the amount of life assurance on the life of each member with the other members, in proportion to their interests or as may be otherwise decided, as beneficiaries, in or to an amount of as set out in schedule III attached hereto, or greater. 6.3 In the event of the death of any member, the deceased member shall be deemed to have sold his interest to the remaining members in proportion to their respective interests on the day immediately preceding his death for the amount stated above, payable out of the proceeds of the life assurance policy on the life of the deceased member that will have been effected in terms of 6.2; provided that if no such proceeds are payable or the amount thereof is insufficient to discharge such consideration, the consideration or the deficit, as the case may be, shall bear interest, if at all, and be paid in accordance with the general provisions contained in paragraph 7. 6.4 Each of the members consents in terms of section 40(1) to the financial assistance to be provided by the corporation in terms of this paragraph 6 for the purpose of the acquisition of the interest of any of them who may die. 6.5 In the event of any change in the interests of the members or of the composition of the membership of the corporation, the members shall cause the corporation to vary the beneficiaries of each life assurance policy effected in terms of 6.2, except in the case where such policies do not belong to the corporation, so that such beneficiaries shall be the members for the time being of the corporation other than the life assured in proportion to their respective interests. 6.6 Upon the termination for any reason other than death of membership of the corporation of any member, the remaining members shall be deemed to have ceded to him their interests in the assurance policy on his life, except in the case where such policies do not belong to the corporation, and the corporation and the members shall sign all such documents and do all such things as may be required in order to vest in him ownership of that policy. The consideration payable by the cessionary for such policy shall be the surrender value thereof, as certified by the relevant insurer, and shall be paid by the cessionary out of the first proceeds derived by him from the disposal of his interest; and payment by any purchaser of his interest or any portion thereof of such surrender value to the members entitled thereto shall constitute a valid and sufficient discharge, to the extent of such payment, of the purchaser's obligations in regard to payment of the purchase price of the interest or portion thereof acquired. 7. DISPOSAL OF INTEREST OTHER THAN ON DEATH For the purpose of this paragraph 7 the value of the interest of each member in the event of the disposal of his interest under the following circumstances will be set out in schedule III attached hereto. It is agreed that should the balance in the contribution, loan or profits account or of the undrawn profits account of the disposing member be in credit such amounts shall be deemed to be included in the values of the interest of the said member as expressed above. 7.1 Subject to the provisions of section 34, none of the members shall pledge or burden his interest or any part thereof, or (subject to the provisions of 7.3) sell or otherwise dispose of his interest or any part thereof: unless the interest sought to be disposed of has been offered in writing ("the offer") for sale to the remaining members at the specified price and upon the following terms: 7.1.1. the purchaser is obliged to obtain or use his best endeavours to obtain the release of the seller from liability under any suretyship, guarantee or other act of intercession given by the seller of the obligations of or on behalf of the corporation; and if the obligation stipulated is that the purchaser shall use his best endeavours to do so, and the purchaser's endeavours do not result in such release, that the purchaser is to indemnify the seller against such liability; 7.1.2 the purchaser is to indemnify the seller against any personal liability that may be incurred by the seller for any of the obligations of the corporation which may arise in terms of the Act by virtue of the seller having been a member of the corporation; 7.1.3 in the event of the balance in the contribution, load or profits account or undrawn profits account of the disposing member are in debit then their total value shall be set off against the values of the said interest as specified above and this diminished amount shall be regarded as the value of the interest of the disposing member; 7.1.4 the value of the disposing member's interest shall represent the purchase price of the said interest and shall be paid monthly by the 15th day of the succeeding month in instalments equal to 1/3 of that month's net profit after tax earned by the corporation provided that: i) if the corporation is liquidated or compelled to be de-registered due to market forces or any other reasonable factor or does not earn any net profit for any legitimate reason, no claim can or shall be instituted against remaining members or the corporation for any payment whatsoever and that the balance owing to disposing members shall be deemed to have been paid in full provided that should the corporation resume profit making, the remaining members shall be liable to continue making payments to the disposing member under the same terms of this clause. On disposal of a member's interest as set out above a set of accounts and statements of the books of account of the corporation, audited if required, but at the disposing member's expense, shall be prepared and made available to all members, including the disposing member. Thereafter and until such time as the disposing member's interest has been paid for in full, he shall have the authority to inspect by request the monthly final accounts of the corporation, duly drawn up by the corporation's bookkeeper not later than the 15th day of the succeeding month. Until such time as the disposing member's interest has been paid in full he shall also be entitled to copies of the year end financial statements of the corporation and would be entitled, at his own expense, to appoint an independent auditor to verify the correctness thereof. 7.2 The offer shall be irrevocable for a period of 3 (three) calender months after its delivery to the offerees and shall be capable of acceptance by them in proportion to their respective interest or in such other proportions as they may agree, provided that: 7.2.1 offerees whose interests comprise a majority of the aggregate interest of all of the offerees may require by written notice to the corporation and all its members that the offer be assigned to and accepted by the corporation, in which event the offer shall be deemed to have been assigned to and accepted by the corporation; and 7.2.2 if the offer is not accepted by the corporation in terms of 7.2.1, but it is accepted by some only of the offerees in respect of portion only of the interest sought to be disposed of, the offeror shall give written notice to the accepting offerees of that fact, and the accepting offerees shall have the right to accept the offer in respect of the portion of the interest not previously accepted in proportion to their respective interests, or in such other proportions as they may mutually agree, for a period of seven days after the receipt by them of such notice, and this procedure shall be repeated as often as is necessary until the whole of the interest sought to be disposed of will have been accepted or no offeree remains who is willing to accept an offer in respect of the unaccepted portion thereof; in the latter event, the offeror shall have the right, within a period of seven days after the lapse of the last of the offers required to be made in terms of 7.1.1, to declare that the acceptances of the offer in respect of portion only of the interest sought to be disposed of shall be null and void. 7.3 Subject to the provisions of section 34, an offeror having made an offer or series of offers in terms of 7.1 and 7.2 shall not, after the refusal or expiry thereof, sell his interest or any portion thereof, save that the offeror shall have the right to dispose of the whole of the interest sought to be disposed of (if the offeror will have exercised the right to declare acceptances as to part null and void in terms of 7.2.2) or the unaccepted portion thereof, to a third person approved by the offerees, which approval shall not be unreasonably withheld, at a price which is not less (or, in the case of the sale of the unaccepted portion only of the interest sought to be disposed of, proportionally less) than the price at, upon terms which are not less onerous to the purchaser, than the price at and terms upon which the offer referred to in 7.1 and 7.2 will have been made. 7.4 None of the members ("the majority") shall enter into any transaction for the sale or disposal of an interest or interests in aggregate comprising a majority of the interests in aggregate of all the members unless the majority will have given written notice to the remaining members ("the minority") of his or their intention to do so, stating the full terms and conditions upon which he or they intend to do so. The minority or any of them ("the requisitionists") shall have the right, within a period of seven days after receipt of any such notice, to require the majority to refrain from entering into the transaction referred to in the notice (whereupon the majority shall be obliged so to refrain) unless, within thirty days after such requisition, the majority procures the purchase by the same purchaser of the same proportion of the interests of the requisitionists as those of the majority sought to be disposed of in that transaction, at the same unit price and upon the same terms and conditions as are set forth in the majority's notice to the minority. 7.5 If: 7.5.1 the members or any of them receive an offer ("the outside offer") for the purchase of the interests of all of the members; 7.5.2 members whose interests comprise in aggregate a majority of the aggregate interests of all the members ("the majority") have signified in writing to the remaining members ("the minority") their intention to accept that offer which notice shall constitute an offer by the majority to sell their interests to the minority mutatis mutandis at the unit price and upon the terms of the outside offer, which shall be irrevocable and capable of acceptance by the minority in proportion to their respective interests or in such other proportions as they may mutually agree, for a period of fourteen days after the giving of such notice; 7.5.3 the offer referred to in 7.5.2 is refused or expires unaccepted; and 7.5.4 the outside offer does not differentiate between the members as to the unit price payable to them or in any other respect; the provisions of 7.1 shall not apply, and the majority shall have the right to require the minority to join with the majority in accepting the outside offer and giving effect to the sale resulting therefrom. 7.6 Each of the members consent in terms of section 40(a) to the financial assistance to be provided by the corporation in terms of this paragraph 7 for the purpose of the acquisition of the interest of any of them who may sell his interest. 8. DISTRIBUTIONS 8.1 Subject to section 51, the corporation shall make such distributions to the members, in such amounts and at such times, as the members may by resolution determine, provided that no such distribution shall be made otherwise than in proportion to the interests of the members. 8.2 Any surplus arising on the winding-up of the corporation, after the satisfaction of the claims of all its creditors and the costs of winding-up, shall be distributed amongst the members in proportion to their respective interests. 9. ACCOUNTING OFFICER Subject to his acceptance of that appointment, the accounting officer of the corporation shall be the person named in schedule I. 10. ARBITRATION 10.1 For the purpose of this paragraph 10, "dispute" includes, without prejudice to the generality of that term. 10.1.1 the failure to pass any resolution at a meeting of members as a result of: 10.1.1.1 a resolution requiring unanimous approval not being so approved; 10.1.1.2 a deadlock arising with regard to the passing of a resolution; or 10.1.1.3 the absence of a quorum. 10.1.2 Any action by any member contrary to the provisions of this association agreement; 10.1.3 Any dispute between any member and the corporation in connection with; 10.1.3.1 the interest of a member in the corporation; 10.1.3.2 the employment or termination of the employment of a member by the corporation; 10.1.3.3. the powers, duties or office of a managing member; 10.1.3.4 the affairs of the corporation. 10.2 Should a dispute arise, any member or the corporation shall be entitled to require, by written notice to the corporation that the dispute be submitted to arbitration in terms of this paragraph 10 and copies of such written notice shall be sent immediately by the corporation to all members. 10.3 Subject to the provisions of this paragraph 10, an arbitration shall be held under the provisions of the arbitration laws for the time being in force in the Republic of South Africa (as it is constituted from time to time), provided that: 10.3.1 The arbitrator shall be, if the question in issue is: 10.3.1.1 primarily an accounting matter, an independent person qualified for appointment as an accounting officer of a corporation under the Act who has held that qualification for not less than 10 years; 10.3.1.2 primarily a legal matter, a practising senior counsel or attorney of not less than ten years standing; 10.3.1.3 any other matter; an independent person agreed upon by the members who are parties to the dispute, and failing such agreement within three days after the date on which the arbitration is demanded, shall be appointed by the President for the time being of the Law Society of the province in which the corporation's registered office is situated, who may be requested by any party to the dispute to make that nomination at any time after the expiry of that three day period; 10.3.2 the arbitration shall be held in the town in which the registered office of the corporation is situated in accordance with the formalities an/or procedures to be settled by the arbitrator, and may be held in an informal and summary manner, on the basis that it shall not be necessary to observe or carry out the usual formalities of procedure, pleadings and/or discovery, or the strict rules of evidence. 10.3.3 the arbitrator shall be entitled: 10.3.3.1 to investigate or cause to be investigated any matter, fact or thing which he considers necessary or desirable in connection with the dispute and for the purpose shall have the widest powers of investigating all the books and records of the corporation and of any member who is a party to the dispute and the right to take copies of make extract therefrom and the right to have them produced or delivered at any reasonable place required by him for the aforesaid purposes; 10.3.3.2 to interview and question under oath any of the members; 10.3.3.3 to decide the dispute according to what he considers just and equitable in the circumstances; 10.3.3.4 to make such award, including an award for specific performance, an interdict, damages or a penalty or otherwise as he in his discretion may deem fit and appropriate; 10.3.4 the arbitration shall be held as quickly as possible after it is demanded with a view to its being completed within thirty days after it has been so demanded; 10.3.5 immediately after the arbitrator has been agreed upon or nominated in terms of 10.3, any of the parties to the dispute shall be entitled to call upon the arbitrator to fix a date and place when and where the arbitration proceedings shall be held and to settle the procedure and manner in which the arbitration proceedings will be held. 10.4 Any award that may be made by the arbitrator: 10.4.1 shall be final and binding; 10.4.2 will be carried into effect; and 10.4.3 may be made an order of any court to whose jurisdiction the parties to the dispute are subject. 11. AMENDMENTS No agreement purporting to amend, add to or consensually cancel this agreement shall have any force or effect unless it is reduced to writing and signed by the corporation and the members, including (in the case of an amendment or addition) any new member whose admission as such may have given rise to the need for such amendment or addition. 12. NOTICES 12.1 The members choose as their domicilium citandi et executandi for the purposes of this agreement the address stated in respect of that member in schedule I. 12.2 Each member shall from time to time have the right to vary his address stated in schedule I. 12.3 A notice given to a member at his address stated in the schedule shall be deemed, until the contrary is proved by him, to have been received by him on the date of delivery, if delivered by hand, or on the fifth business day after the date of posting, if posted by prepaid registered post. 12.4 No resolution of the members or transaction of the corporation shall be invalidated by reason of any inadvertent omission to give any required notice to any member or to failure of any member to receive such notice. 13. CONFLICT WITH ACT If any provision of this agreement is in conflict or inconsistent with any provision of the Act the invalidity of any such provision of this agreement shall not affect the validity of the remainder of the provisions thereof. 14. RESTRAINT ON TRADE It is agreed that should any of the member's membership in the corporation be terminated through the disposal of his interest in the corporation, then and from the date of such disposal the member undertakes to for a period of 3 years not be engaged or associated, wither directly or indirectly with any firm, company, partnership, undertaking or the like which, in any way directly competes with any of the activities of the corporation at the time of the disposal. This restraint shall be applicable and limited to the Helderberg basin including Stellenbosch and Grabouw and any other city or town in which the Corporation may be operating at the time of such disposal. This restraint shall not be applicable in the event of all the members at a specific time selling the whole of their interest in the corporation to a third party and outsider or in the event of the corporation being deregistered or liquidated by the courts or by mutual consent of the members, in which event no restraint will be of force and effect against any member. SIGNED at SOMERSET WEST on this the ____________ day of ______________ 2001. AS WITNESSES: 1. ______________________ 2. ______________________ _____________________DANIE VISSER SIGNED at SOMERSET WEST on this the ____________ day of ______________ 2001. AS WITNESS: 1. ______________________ 2. ______________________ _____________________PETRO FOURIE SIGNED at GRABOUW on this the ____________ day of ______________ 2001. AS WITNESS: 1. ______________________ 2. ______________________ _______________________DICK WETLEGG SIGNED at GRABOUW on this the ____________ day of ______________ 2001. 1. ______________________ 2. ______________________ _______________________ for COMPREHENSIVE INVESTMENTS CC Reg No. 2001/016051/23 SCHEDULE I 1. Names of, Contributions, Interests, Address Members (3.1) (3.3) (12.1) _____________________________________________________________________ 2. Venue for meetings (5.3): 3. Quorum (5.4): members holding interests in aggregate equal to of the interests of all members. 4. Distribution policy: 5. Accounting Officer: ____________________________ ____________________ Date ____________________________ ____________________ Date ____________________________ ____________________ Date SCHEDULE II 1.Managing Members, Dates of Appointment, Remuneration per month (4.1), (4.1), (4.1) _____________________________________________________________________ 2. Other terms and conditions of employment (4.1): 3. Restriction on powers (4.7): 4. Secretary (5.1) ____________________________ ____________________ Date ____________________________ ____________________ Date ____________________________ ____________________ Date SCHEDULE III DISPOSAL OF INTERESTS (paragraphs 6 & 7) ___________________________________________________________________ 1. Upon the death of a member: 2. Upon the sequestration of a member's estate: provided that notwithstanding anything to the contrary herein contained inclusive of the entire agreement of which the schedule is a part, such member in his sole discretion may sell his interests to one or both of the individuals reflected opposite his name in the list given below and may continue to be employed by the company as a manager and substantially upon the same terms and conditions as if he had not ceased to be a managing member. DANIE VISSER : _______________ _______________ PETRO FOURIE : _______________ _______________ DICK WETLEGG : _______________ _______________ 3. Member's permanent occupational disability: 4. In pursuance of a Court Order to dispose of an interest: 5. Any other circumstances not specified: ____________________________ ____________________ Date ____________________________ ____________________ Date ____________________________ ____________________ Date |