Investors

1.0       INTRODUCTION

Axiata Digital Services Sdn Bhd ("ADS"), a wholly owned subsidiary of Axiata Group Berhad ("Axiata"), had on 24 July 2015 entered into a Subscription and Stockholders' Agreement ("Agreement") with WSO2 ("WSO2") and WSO2.Telco, Inc. ("WSO2 Telco") for the subscription by ADS of the following shares in WSO2 Telco ("Initial Subscriptions") and to govern their relationship in WSO2 Telco:-

i)  5,000,000 shares of Common Stock at USD0.0001 per share ("WSO2 Telco-Common Stock"); and

ii) 4,615,385 shares of Preferred Stock at USD0.39 per share ("WSO2 Telco-Preferred Stock").

WSO2 current holds one WSO2 Telco-Common Stock. On completion of the Initial Subscriptions, WSO2 will subscribe for 4,999,999 WSO2 Telco-Common Stocks at USD0.0001 per share.

2.0       INFORMATION ON WSO2 AND WSO2 TELCO

Founded in 2005, WSO2 is an open source application development software company focused on providing service-oriented architecture (SOA) solutions for professional developers.

Today, WSO2 is the only company providing a comprehensive, open source ecosystem platform for connected businesses. Made up of over 25 products covering all major categories from integration and API management to identity and mobile, WSO2 platform are used by hundreds of major companies throughout the world across diverse industries and/or business such as Boeing, eBay, Cisco, Expedia, Fidelity Investments and Trimble Navigation and runs billions of enterprise-critical transactions annually.

WSO2 has offices in the United States; namely, Mountain View, California and Bloomington Indiana with overseas offices in United Kingdom and Sri Lanka. WSO2's headquarters is located at 787 Castro Street, Mountain View, CA 94041.

WSO2 Telco is a corporation incorporated under the laws of the State of Delaware, the United States with principal place of business at 20, Palm Grove, Colombo 03, Sri Lanka. WSO2 Telco is the designated joint venture vehicle to be engaged in the business of the distribution of mobile internet and fulfilment exchange (MIFE) together with WSO2-related technology and services to mobile network operators, as well as to develop and distribute related and follow-on products and services, in each case targeted to the telecommunications industry.

3.0       SALIENT TERMS OF THE SUBSCRIPTION, PURCHASE CONSIDERATION AND SOURCES OF FUNDS

Further to the Initial Subscriptions and subject to WSO2 Telco achieving all its determined key performance indicators on or before the first anniversary of the completion of the Initial Subscriptions, ADS shall further subscribe in cash an additional 2,051,282 WSO2 Telco-Preferred Stocks at USD0.39 per share.

The holder of WSO2 Telco-Preferred Stock is entitled to, from time-to-time, to convert each of WSO2 Telco-Preferred Stocks into one fully paid-up share of WSO2 Telco-Common Stock. At full conversion of its WSO2 Telco-Preferred Stocks, ADS will hold 70% of the paid-up capital of WSO2 Telco.  

The purchase consideration for the subscription by ADS of the Initial Subscriptions and the additional WSO2-Telco Preferred Stocks ("WSO2 Telco-Stocks") totalling USD2.6 million will paid in cash and will be funded through internally generated funds.

4.0       RATIONALE FOR THE ENTRY INTO THE AGREEMENT

The joint venture allows the creation of a new business that is designed to empower global telecommunication operators to partner with OTT businesses by making integration friction-less with lower cost. The joint venture will leverage WSO2's class leading open source middleware technology allowing telecommunication companies for faster engagement and partnerships and opening up a new way of doing business in the digital space.

5.0       FINANCIAL EFFECTS

The subscription by ADS of the WSO2 Telco-Stocks does not have any effect on the issued and paid-up share capital of Axiata and will not have any material effect on the earnings, gearings and net assets of the Axiata Group for the year financial ending 31 December 2015.

6.0       APPROVAL OF SHAREHOLDERS

The entry by ADS into the Agreement is not subject to the approval of the shareholders of Axiata. 

7.0       DIRECTORS' AND MAJOR/SUBSTANTIAL SHAREHOLDERS' INTEREST

None of the Directors and major shareholders of Axiata and/or persons connected to them have any interest direct and/or indirect in the Agreement.

This announcement is dated 24 July 2015.