SAFEROADS HOLDINGS LIMITED — Governance Information 2005

Dec 13, 2005

Date 31/10/2005

Maddocks

Lawyers140 William Street Melbourne Victoria 3000 Australia Telephone 61 3 9288 0555 Facsimile 61 3 9288 0866 Email info@maddocks.com.au www.maddocks.com.au DX 259 Melbourne

Rules of the Employee Share Option Plan

Saferoads Holdings Limited ACN 116 668 538

Interstate officeSydney SyaneyAffiliaded officesAdelaide, Beijing, Brisbane, Colombo,Dubai, Hong Kong, Jakarta, Kuala Lumpur,Manila, Mumbai, New Delhi, Perth,Singapore, Tianjin

Table of Contents

$\ddagger$ .	DEFINITIONS AND INTERPRETATION
	Definitions1.11.2Interpretation1.3Primary Instruments
2.	PURPOSE OF THE PLAN
3.	COMMENCEMENT AND OPERATION OF THE PLAN
4.	LIMITATIONS
5.	OFFERS
6.	ACCEPTANCE OF OFFER
7.	ENTITLEMENT
8.	EXERCISE OF OPTIONS
9.	LAPSE OF OPTIONS
10.	DEALINGS WITH OPTIONS
11.	NEW ISSUES AND RECONSTRUCTIONS OF CAPITAL
12.	QUOTATION
13.	ADMINISTRATION OF THE PLAN
14.	AMENDMENT TO RULES
15.	RIGHTS OF PARTICIPANTS
16.	OTHER RIGHTS AND CONDTIONS
17.	GOVERNING LAW
18.	ADVICE

Rules

DEFINITIONS AND INTERPRETATION $\mathbf{1}$ .

$1.1$ Definitions

In these rules, unless the context otherwise requires:

ASIC means Australian Securities and Investments Commission.

ASX means Australian Stock Exchange Limited (ACN 008 624 691).

Board means all or some of the directors of the Company acting as a board or, where appropriate, a committee of the Board.

Certificate means the Option Certificate issued pursuant to rule 6.5 in the form approved by the Board from time to time or, if the Board has determined that Options will be uncertificated, then the statement issued to the Participant which discloses the number of Options entered in the register of Option holders in respect of the Participant.

Company mans Saferoads Holdings Limited ACN 116 668 538.

Constitution means the constitution of the Company.

Corporations Act means the Corporations Act 2001 (Cth).

Eligible Employee means an Employee who the Board determines is to receive an Offer.

Employee means:

• $(a)$ a full-time or part-time employee of a Group Company, including a director of a Group Company who holds a salaried employment in any Group Company; and
• $(b)$ a non-executive director of a Group Company.

Employee Incentive Scheme means an employee share or option scheme extended only to employees (including directors) of a Group Company.

Exercise Conditions means, in respect of an Offer, the conditions determined by the Board and specified in the Offer which must be satisfied before the Option can be exercised, as reduced (if at all) or waived in whole or in part at any time in any particular case by the Board and notified to the Participant.

Exercise Period means the period commencing on the First Exercise Date and ending on the Last Exercise Date.

Exercise Price means, subject to rule 5.6, the amount payable by the holder on the exercise of an Option which amount shall, subject to the Listing Rules, be determined at the discretion of the Board

First Exercise Date means, unless otherwise specified at the discretion of the Board in an Offer, the earlier of:

• $(a)$ the first, second or third anniversary of the Grant Date, as determined by the Board: and
• $(b)$ the date on which Special Circumstances arise in respect of a Participant.

Grant Date means the date on which the Board grants the Option to the Eligible Employee.

Group means the Company and its subsidiaries and Group Company means any one of them.

Last Exercise Date means, unless otherwise specified at the discretion of the Board in an Offer, the date 10 years from the Grant Date or, if Special Circumstances arise in respect of a Participant, then the date 3 months after such Special Circumstances arise.

legal personal representative means the executor of the will or an administrator of the estate of a deceased person, the trustee of the estate of a person under a legal disability or a person who holds an enduring power of attorney granted by a person.

Listing Rules means the official listing rules of the ASX.

Minimum Price means, in respect of an Option:

WP x [1.05]

where WP is the weighted average of the prices at which Shares were traded on the ASX during the one week period up to and including the day upon which the Exercise Price for that Option is to be determined.

Notice of Exercise means a duly completed and executed notice of exercise of an Option by a Participant, in the form approved by the Board from time to time.

Option means an option granted to a Participant under the Plan to subscribe for a Share.

Offer means an offer of Options to an Eligible Employee by the Company.

Participant means a person who holds Options granted under this Plan and includes, if a Participant dies or becomes subject to a legal disability, the legal personal representative of the Participant.

Plan means the plan established and operated by these rules and known as the Employee Share Option Plan.

Retirement in relation to a Participant means the termination of the Participant's employment or directorship with any Group Company by reason of the attainment of such age as the Group Company may from time to time specify as the age for retirement for the Participant or such earlier age as the Group Company may in its absolute discretion approve.

Retrenchment in relation to a Participant means the termination of employment or directorship of the Participant as a result of a reconstruction or sale of part or all of the business of the Group in circumstances where the Board is satisfied that there is no continuing employment or directorship role for the Participant.

Security Interest means a mortgage, charge, pledge, lien, encumbrance or other third party interest of any nature.

Shares means fully paid ordinary shares in the capital of the Company.

Special Circumstances means with respect to a Participant:

• $(a)$ Total and Permanent Disablement:
• $(b)$ the death of the Participant:
• $(c)$ Retirement:
• $(d)$ Retrenchment: or
• $(e)$ such other circumstances as the Board may in its absolute discretion at any time determine (whether before or after the Grant Date).

Subsidiary means a body corporate of which the Company is a holding company within the meaning given in the Corporations Act.

Tax includes any tax, levy, impost, deduction, charge, rate, contribution, duty or withholding which is assessed (or deemed to be assessed), levied, imposed or made by any government or any governmental, semi-governmental or judicial entity or authority together with any interest, penalty, fine, charge, fee or other amount assessed (or deemed to be assessed), levied, imposed or made on or in respect of any or all of the foregoing.

Total and Permanent Disablement means the termination or cessation of a Participant's employment with a Group Company as a result of total and permanent disablement as determined by the Board.

$1.2$ Interpretation

In these rules, unless a contrary intention appears:

• headings are for convenience only and do not affect the interpretation of $1.2.1$ the Plan unless the context requires otherwise;

• $1.2.2$ any reference in these rules to any enactment or the Listing Rules includes a reference to that enactment or those Listing Rules as from time to time amended, consolidated, re-enacted or replaced and to all regulations or instruments issued under it:

• $1.2.3$ any words denoting the singular include the plural and words denoting the plural include the singular;

• $1.2.4$ any words denoting one gender include the other gender;

• $1.25$ where any word or phrase is given a definite meaning in these rules, any part of speech or other grammatical form of that word or phrase has a corresponding meaning:

• $1.2.6$ a reference to a power, right or discretion being exercisable by the Board is taken to be a reference to that power, right or discretion being exercisable by a delegate of the Board; and

• $1.2.7$ a reference to a person includes the legal representatives, successors and assigns of that person.

$1.3$ Primary Instruments

These rules are to be interpreted subject to the Constitution, the Listing Rules, the Corporations Act and any other applicable laws.

PURPOSE OF THE PLAN $2.$

The purpose of the Plan is to encourage greater interest on the part of Employees in the performance and success of the Group by providing Eligible Employees with the opportunity to acquire Options, and ultimately Shares, in the Company, in accordance with these rules.

COMMENCEMENT AND OPERATION OF THE PLAN $3.$

• $3.1$ The Plan will commence operation on the date determined by the Board.
• $3.2$ The Plan shall operate in accordance with these rules which bind the Group Companies and each Participant.

4. LIMITATIONS

• $4.1$ Unless the Board determines otherwise, Options may not be granted to a Participant under the Plan unless the Participant is an Eligible Employee as at the Grant Date
• No Option may be offered or granted to, or exercised by, an Eligible Employee or $42$ Participant if to do so would contravene the Corporations Act, the Listing Rules or any other applicable law.
• $4.3$ An Offer may only be made under the Plan if the number of Shares offered when aggregated with:
  • $4.3.1$ the number of Shares which would be issued were each outstanding offer or option to acquire unissued Shares under an Employee Incentive Scheme to be accepted or exercised; and
  • $4.3.2$ the number of Shares issued during the previous 5 years pursuant to an Employee Incentive Scheme,

but disregarding any offer made, or option acquired or Share issued, by way of or as a result of:

$4.3.2.1$ an offer to a person situated outside Australia at the time of receipt of the offer: or

4322 an offer that did not require disclosure to investors because of section 708 of the Corporations Act,

does not exceed 5% of the total number of Share as at the time of the Offer.1

• $4.4$ If and from the date the Company is admitted to the official list of ASX, despite any other provision of the Plan, no Offers may be made, unless otherwise expressly permitted by ASIC or the Corporations Act including, without limitation, under section 708 of the Corporations Act unless and until Shares have been listed for quotation on ASX throughout the 12 months immediately before the Offer without suspension for more than a total of 2 trading days during that period.2
• $4.5$ An Eligible Employee may not accept an offer of Options under the Plan if. immediately after the grant of the Options the subject of the offer, the Oualifying Employee would:
  • $4.5.1$ hold a legal or beneficial interest in more than 5% of the Shares in the Company; or
  • $4.5.2$ be in a position to cast, or control the casting of, more than 5% of the maximum number of votes that might be cast at a general meeting of the Company.
• 4.6 Subject to the Board's discretion to require payment of nominal consideration for the grant of an Option, no consideration will be payable on the grant of an Option.

5. OFFERS

• $5.1$ Subject to these rules, the Board may in its absolute discretion from time to time make Offers to any Eligible Employee.
• 5.2 An Offer must be in writing and, subject to rule 5.3, must state:
  • $5.2.1$ the name and residential address of the Eligible Employee to whom the Offer is made:
  • 522 the date of the Offer:
  • $5.2.3$ the maximum number of Options available to the Eligible Employee;
  • $5.2.4$ the price (if any) payable for the Options;
  • $525$ the First Exercise Date of each Option;
  • 5.2.6 the Last Exercise Date of each Option:
  • $5.2.7$ the time period for acceptance of the Offer;
  • $5.2.8$ the Exercise Price or the manner of determining the Exercise Price; and
  • 5.2.9 the Exercise Conditions (if any) and any other specific terms and conditions applicable to each Option and to the Offer.

<sup>1 Refer to condition 3 of the Schedule to ASIC Class Order CO 03/184.

$2$ Refer to definition of 'eligible offer': ASIC Class Order CO 03/184.

• 53 The Offer must be accompanied by such documents and include such information and undertakings as are required by ASIC or under the Corporations Act.
• Subject to rule 4.3, the number of Options offered to an Eligible Employee shall be 5.4 determined by the Board.
• 5.5 Subject to rule 5.6 and any adjustment under rule 11, the Exercise Price in respect of an Option shall be such amount (if any) as the Board determines at the time of the grant of the Option.
• 5.6 The Exercise Price in respect of an Option must not be less than the Minimum Price.
• An Offer is personal to the Eligible Employee to whom it is made and, accordingly. 5.7 Options may be granted only to the Eligible Employee to whom the Offer is made.

ACCEPTANCE OF OFFER $6.$

• $6.1$ An Eligible Employee who receives an Offer and wishes to accept it must deliver written notice of acceptance of the Offer, together with payment of the price (if any) of the Options, to the Company.
• An Eligible Employee may in his or her discretion accept an Offer, in whole or in $6.2$ part in multiples of 500 Options or such other multiple of Options as the Board determines and notifies to the Participant.
• On delivery to the Company of written notice of acceptance of the Offer, an 6.3 Eligible Employee becomes a Participant and is bound by these rules.
• 6.4 The Company shall, after receiving a written notice of acceptance from an Eligible Employee, grant to the Eligible Employee the Options the subject of the acceptance and notify the Eligible Employee of the Grant Date of such Options.
• 6.5 The Company may issue to a Participant one or more certificates evidencing the Options granted to the Participant and setting out the number of Shares which the Participant is entitled to subscribe for or acquire.
• An Offer not accepted in accordance with rule 6.1 will lapse unless the Board 6.6 determines otherwise.

ENTITLEMENT 7.

• $7.1$ Each Option entitles the Participant who is the holder to subscribe for and be issued one Share at the Exercise Price.
• $7.2$ Subject to these rules and the Listing Rules, the Company must issue a Share on exercise of an Option.
• $73$ Shares issued on the exercise of Options will rank equally with all existing Shares on and from the date of issue in respect of all rights issues, bonus share issues and dividends which have a record date for determining entitlements on or after the date of issue of those Shares.

EXERCISE OF OPTIONS 8.

• An Option may be exercised at any time during the Exercise Period but, if the 8.1 Offer in respect of an Option specified any Exercise Conditions, the Option may not be exercised unless and until those Exercise Conditions have been satisfied.
• 82 Subject to these rules, an Option which has not lapsed may be exercised by the Participant lodging with the Company:
  • $8.2.1$ a Notice of Exercise signed by the Participant;
  • $8.2.2$ the Certificate or Certificates (if any): and
  • $823$ the subscription monies for the relevant Shares being the number of Options exercised by the Participant multiplied by the Exercise Price.
• $83$ A Participant must exercise Options in multiples of 500 or such other multiple as the Board determines and notifies to the Participant unless the Participant exercises all Options to be exercised by him or her at the time.
• 8.4 The exercise by a Participant of only some of the Options held by the Participant shall not affect the Participant's right to exercise at a later date other Options held by the Participant.
• 8.5 Where a Participant submits a Notice of Exercise in respect of only part of the Options covered by a Certificate, the Company shall issue a Certificate which evidences the remaining number of Options held by the Participant.

LAPSE OF OPTIONS 9.

• $9.1$ An Option will lapse on the earliest of:
  • $9.1.1$ the Last Exercise Date;
  • $912$ the termination of the Participant's employment (or, in the case of a nonexecutive director, his directorship) in circumstances which the Board considers to involve fraud, dishonesty or other serious misconduct which would constitute sufficient cause for an employer to dismiss an employee without notice:
  • $9.1.3$ the expiration of 30 days after termination of employment (or, in the case of a non-executive director, the directorship) of the Participant for any other reason (other than due to the occurrence of a Special Circumstance) including resignation; and
  • $9.1.4$ the receipt by the Company of notice from the Participant (after a Special Circumstance has arisen with respect to the Participant) that the Participant has elected to surrender the Option.
• 9.2 On an Option lapsing, all rights of a Participant under the Plan in respect of the Option shall cease.

DEALINGS WITH OPTIONS $10.$

• $10.1$ Options held by a Participant are personal to the Participant and may not be exercised by any other person or body corporate.
• $10.2$ A Participant must not dispose of, grant any Security Interest over or otherwise deal with any Options or any interest in any Options, and any such Security Interest or disposal or dealing will not be recognised in any manner by the Company.

NEW ISSUES AND RECONSTRUCTIONS OF CAPITAL $11.$

• $11.1$ Participants will not be entitled to participate in any new issue of securities in the Company unless:
  • $11.1.1$ they have become entitled to exercise their Options under the Plan: and
  • $11.1.2$ they do so prior to the record date for the determination of entitlements to the new issue and participate as a result of being holders of Shares.

The Company must give to Participants in accordance with the Listing Rules. notice of any issue of securities before the record date for determining entitlements to the issue.

• $11.2$ If the Company makes (whether before or during the Exercise Period) a bonus issue of Shares or other securities to existing shareholders (other than an issue in lieu or in satisfaction of dividends or by way of dividend reinvestment) and no Share has been issued in respect of an Option before the record date for determining entitlements to the bonus issue, then the number of Shares over which the Option is exercisable shall be increased by the number of Shares which the Participant would have received if the Participant had exercised the Option prior to such record date.
• $11.3$ If the Company makes (whether before or during the Exercise Period) a pro-rata issue of Shares (except a bonus issue) to existing shareholders (other than an issue in lieu or in satisfaction of dividends or by way of dividend reinvestment) and no Share has been issued in respect of an Option before the record date for determining entitlements to the issue, the Exercise Price of the Option shall be reduced in accordance with the Listing Rules.
• If there is any reorganisation of capital of the Company (whether before or during $11.4$ the Exercise Period) then the number of Options to which each Participant is entitled and their Exercise Price will be reconstructed in accordance with the Listing Rules.
• $11.5$ If (whether before or during the Exercise Period) a resolution for a members voluntary winding up of the Company is passed (other than for the purpose of a reconstruction or amalgamation) the Board may, in its absolute discretion, give written notice to Participants of the passing of the resolution. Subject to the Exercise Conditions, the Participants shall be entitled, in the period referred to in the notice, to exercise their Options provided that no Option shall be capable of exercise later than the Last Exercise Date.
• 11.6 For the purposes of this rule 11, if Options are exercised simultaneously, then the Participant may aggregate the number of Shares or fractions of Shares for which

the Participant is entitled to subscribe. Fractions in the aggregate number only will be disregarded in determining the total entitlements of a Participant.

$11.7$ Any calculations or adjustments which are required to be made under this rule 11 will be made by the Board and will, in the absence of manifest error, be final and conclusive and binding on the Company and the Participant.

$12.$ ΟΠΟΤΑΤΙΟΝ

• $12.1$ The Company will not seek official quotation of any Options.
• $12.2$ The Company shall apply to ASX for quotation of Shares issued on exercise of Options if other Shares of the Company are officially quoted at that time, but quotation of such Shares cannot be guaranteed.

ADMINISTRATION OF THE PLAN $13.$

• $131$ The Plan shall be administered by the Board which has the power to:
  • $13.1.1$ determine appropriate procedures and make regulations for the administration of the Plan which are consistent with these rules;
  • resolve conclusively all questions of fact or interpretation arising in $1312$ connection with the Plan;
  • $13.1.3$ terminate or suspend the operation of the Plan at any time, provided this termination or suspension does not adversely affect the right of Participants holding Options at that time;
  • $1314$ delegate such functions and powers as it may consider appropriate for the efficient administration of the Plan to any person or persons capable of performing those functions and exercising those powers; and
  • take and rely upon independent professional or expert advice in or in $13.1.5$ relation to the exercise of any of their powers or discretions under these rules.
• $13.2$ Where these rules provide for a determination, decision, approval or opinion of the Board, such determination, decision, approval or opinion may be made or given by the Board in its absolute discretion.
• $13.3$ Any power or discretion which is conferred on the Board by these rules may be exercised by the Board in the interests or for the benefit of the Company, and the Board is not, in exercising such power or discretion, under any fiduciary or other obligation to any other person.
• The Company shall pay all expenses, costs and charges incurred in its 13.4 administration of the Plan.

$14.$ AMENDMENT TO RULES

Subject to the Listing Rules, the Board may at any time amend any of these rules or waive or modify the application of any of these rules in relation to any Participant.

$15.$ RIGHTS OF PARTICIPANTS

• 15.1 These rules:
  • $15.1.1$ do not confer on any Eligible Employee the right to receive an Offer:
  • 15.1.2 do not confer on any Participant the right to continue as an Eligible Employee:
  • $15.13$ do not affect any rights which the Company or any Subsidiary may have to terminate the employment of any Participant; and
  • 15.1.4 may not be used to increase damages in any action brought against the Company or any Subsidiary in respect of that termination.
• $15.2$ Participation in the Plan does not affect, and is not affected by, participation in any other scheme operated by the Company unless the terms of that other scheme provide otherwise.

OTHER RIGHTS AND CONDTIONS $16.$

• $16.1$ The Company must give to each Participant in accordance with the Listing Rules notice of any change to the Exercise Price of any Options held by the Participant or to the number of Shares which the Participant is entitled to subscribe for on exercise of an Option.
• 16.2 Notices may be given by the Company to Participants in such manner as the Board may from time to time determine.
• 16.3 Participants shall be sent all reports and accounts required to be laid before the members of the Company in a general meeting and all notices of general meetings of members but will not, as a Participant, have any right to attend or vote at those meetings.
• 16.4 A Participant shall have no interest in a Share the subject of an Option held by the Participant unless and until the Share is issued to that Participant under these rules.

$17.$ GOVERNING LAW

• 17.1 These rules and the rights and obligations of Participants are governed by the laws of the State of Victoria.
• 17.2 Each Participant irrevocably and unconditionally submits to the non-exclusive jurisdiction of the courts of the State of Victoria and courts entitled to hear appeals from those courts.

18. ADVICE

Eligible Employees should obtain their own independent advice at their own expense on the financial, taxation and other consequences to them of or relating to participation in the Plan.