EX 10.1
Private & Confidential
DATED 8 March 2000
Boxmore International Plc (1)
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Xxxx Xxxxx (2)
______________________
Service Agreement
______________________
Service Agreement
AN AGREEMENT made the eighth day of March 2000 between Boxmore
International Plc whose Registered Office is situated at Xxxxx
Xxxxx, Xxxxxxxxxx Xxx, Xxxxxxxx Xxxxxxxxxx Xxxxxx,
Xxxxxxxxxxxx, XX00 0XX (hereinafter called "the Company")
which is a subsidiary of Chesapeake UK Acquisitions II Plc,
Badminton Court, Rectory Way, Old Amersham, Bucks, HP7 0DD
("Chesapeake") of the one part and Xxxx Xxxxx of 00 Xxx Xxxxxx
Xxxx, Xxxxxx, Xxxxxxxx, Xx Xxxx, XX00 0XX (hereinafter called
"the Director") of the other part.
WHEREBY IT IS AGREED as follows:-
1. DEFINITIONS
In this Agreement:
a) "the Board" constitutes the Board of Directors of the
Company.
b) "Group" shall mean the Company and any Group Companies.
c)"Group Company" means any Company which is for the time
being a subsidiary or holding Company of the Company or
any subsidiary of any such holding Company. For these
purposes the terms "subsidiary" and "holding company"
shall have the meanings ascribed to them by Article 4 and
Article 4A of the Companies Order 1990.
d)"Chesapeake Company" means Chesapeake and any company
which is from time to time a subsidiary or a holding
company of Chesapeake or a subsidiary (other than
Chesapeake) of a holding company of Chesapeake with the
exception of the Company and each associated Company.
e)"Intellectual Property" includes letters, patent and
trade marks whether registered or unregistered,
registered or unregistered designs, utility models,
copyrights including design copyrights, applications for
any of the foregoing and the right to apply for them in
any part of the world, discoveries, creations, inventions
or improvements upon or additions to an invention,
confidential information, know-how and any research
effort relating to any of the above mentioned business
names whether registerable or not moral rights and any
similar rights in any country.
2. APPOINTMENT
a)The Company shall employ the Director and the Director
shall serve the Company as a Director. The Director's
employment shall commence on the date hereof and, subject
to Clause 15 shall continue unless or until terminated by
either the Company giving two years' notice or the
Director giving one year's notice in writing subject to
provisions of clause 19(a). The Director's period of
continuous employment began on 1 March 1988 the date the
Director commenced employment with Boxmore. The Director
represents and warrants that he is not bound by or
subject to any court order, agreement, arrangement or
undertaking which in any way restricts or prohibits him
from entering into this Agreement or from performing his
duties hereunder.
b)The Director's employment shall in any event terminate on
the date on which the Director reaches the age of 62.
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3. SALARY
a)The Director's salary shall be L185,000 per annum or at
such increased rate as shall be notified to the Director
by the Company payable monthly on the last day of each
calendar month. The first review of such salary shall be
on 1st July 2001 and thereafter on 1st July in each year.
At this first review any salary increase will be
backdated to 1 January 2001. Such review will be at the
absolute discretion of the Company. In the event of any
increase in salary being so agreed or notified such
increase shall thereafter have effect as if it were
specifically provided for as a term of this agreement.
b)The Company hereby undertakes that the Company will
annually keep under review the Director's remuneration
package under this Agreement.
c)In addition to his salary the Director shall be entitled
to participate in and be entitled to receive any bonuses
as determined by the `Chesapeake Annual Incentive Plan'.
d)The Director shall not be entitled to any other salary or
fees as a director or employee of the company or any
associated company.
4. POWERS AND DUTIES
As a Director of the Company the Director shall:
a)Undertake such duties and exercise such powers in
relation to the Company and its business as the Company
shall from time to time assign to or vest in him;
b)In the discharge of such duties and in the exercise of
such powers observe and comply with all resolutions,
regulations and directions from time to time made or
given by the Company;
c)In the absence of any specific directions from the
Company (but subject always to the memorandum and
articles of the Company) shall carry out the duties of
Director;
d)Devote the whole of his time and attention during
business hours (unless otherwise approved by the Company)
to the discharge of his duties hereunder and do all in
his power to promote, develop and extend the business of
the Company;
e)Conform to such hours of work as may from time to time
reasonably be required of him and not be entitled to
receive any additional remuneration for work outside
normal office hours.
f) In pursuance of his duties hereunder perform such
services for subsidiary and associated companies of the
Group and (without further remuneration unless otherwise
agreed) accept such offices in such subsidiary, fellow
subsidiary and associated undertakings as the Company may
from time to time reasonably require;
PROVIDED ALWAYS that if such additional duties managing
or otherwise involve significant or material change to
his employment, the Director shall not be required to
perform such services or accept such offices without his
consent;
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g) Comply with:
i)Every rule of law; and
ii) The rules and regulations of any Stock Exchange;
and
iii) Every regulation of the Company for the time
being in force or relative to dealings in shares or
other securities of the Group.
h)The Director shall carry out his duties and exercise his
powers jointly with any other Director(s) or Executive
appointed by the company to act jointly with him.
i)The Director shall observe, perform and comply with all
rules and regulations of the Company or any statutory or
other competent authority regarding health and safety at
work and environmental legislation.
j)The Director shall not during the term of this Agreement
accept a seat on the Board of Directors of any other
company or companies outside the Group without first
obtaining the consent of the Board.
5. CONFIDENTIAL INFORMATION
a) The Director shall not during or after the termination of
this Agreement use for his own purposes, or any purposes
other than those of the Company, Group or Chesapeake
Corporation divulge or communicate to any person or
persons and shall use his best endeavours to prevent the
divulgence or communication to any person or persons
except to those officials of the Group or other proper
persons whose province it is to know the same, any of the
Group's or any other Chesapeake Company's secrets or any
other information which he may receive or obtain in
relation to the Group's or any other Chesapeake Company's
internal or external affairs or to the working of any
patented process or invention which is carried on or used
in the Group's or any other Chesapeake Company's
workshops or connected with its business affairs. This
restriction shall cease to apply to any information or
knowledge, which may come into the public domain
otherwise than through the default of the Director.
The Director shall not at any time, except as is
necessary for the purposes of his employment hereunder:
(i) Use, adopt or employ or be party to the use,
adoption or employment of or disclose, divulge or
communicate to any person or persons, company or
corporation any information obtained or acquired by
him during his employment in relation to:
(1) Any process, method, formulae, drawings,
recipes, appliances, machinery, apparatus or
plant of a private character (that is to say
which are not known to and used by the trade
generally) belonging to the Group which at any
time during his employment by the Company may
have been used by the Group or with which the
Director may have become acquainted during and
in the course of his employment by the Group.
(2) The results of any investigations or experiments
which may have been made by the Group during his
employment or by their respective predecessors
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in business or by any person or persons by or
under the order or direction or for the benefit
of the Group or their respective predecessors
with which the Director may have become
acquainted during and in the course of his
employment by the Company which would be
prejudicial to the business or interests of the
Group and which have not appeared in any journal
or literature published for the information of
persons unconnected with the Group.
(ii)Disclose, divulge or communicate to any person or
persons, company or corporation any information
confidential to the Company obtained or acquired by
him during his employment hereunder the disclosure of
which may be prejudicial to the business or interests
of the Group and which is not available from a source
accessible to the general public.
All notes, memorandums, records, lists of customers,
suppliers and employees, correspondence, documents,
computer and other discs and tapes, data listings,
codes, designs and drawings and other documents and
material whatsoever (whether made by the Director or
otherwise) relating to the business of the Company or
any Group Company (and any copies of the same) shall
be and remain the property of the Company or the
relevant Group Company.
6. NON-SOLICITATION/NON-COMPETITION
a)The Director shall not during the currency of this
Agreement and for a period of 12 months from the
termination of this Agreement in any case without the
previous written consent of the Company either personally
or by his agent whether on his own behalf or whether
alone or jointly with or as a director, manager, partner,
shareholder, employee or consultant of any other person,
firm or company:
(i) Canvas or solicit orders from or endeavour to
entice away from the Company or any Group Company, any
person, persons or company who shall at any time during
the year immediately preceding such termination have
been a customer of the Company or the Group or any
member thereof and with whom during such period the
Director or someone under his direct supervision had
personal dealings in the 12 months immediately
preceding the date of such termination of employment;
(ii) Engage on his own account or as a director,
principal or manager of any company in direct
competition with the Company and/or the Group any
person who has at any time during the year immediately
preceding such termination been employed or engaged by
the Group and who by reason of such employment or
engagement is in possession of any trade secrets or
confidential information of the Company and/or the
Group or who has acquired influence over its customers;
(iii) Within the UK, Ireland, Belgium, Holland, Germany
Spain and France, either on his own account or for any
other person, firm or company and in competition with
the Group, directly carry on or be engaged or concerned
or interested in any business of a kind carried on by
the Group at the date of termination of the Director's
employment hereunder and in which the Director shall
have been actively involved and obtained knowledge
within the period of one year preceding the date of
termination of employment.
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b)This 12-month period of non-solicitation/non-competition
will be reduced to six months if the Company invokes
clause 15i) and requires a period of `Garden Leave' in
excess of six months.
c)While the restrictions in this Clause 6 are considered by
both parties to be reasonable in all the circumstances it
is recognised that restrictions of the nature in question
may fail for technical reasons unforeseen and accordingly
it is agreed that if any of such restrictions shall be
adjudged to be void or ineffective if part or parts of
the wording thereof were deleted the said restrictions
shall apply with such deletions as may be necessary to
make them valid and effective.
7. INTELLECTUAL PROPERTY
a) The parties foresee that the Director may make,
discover or create Intellectual Property in the course of
his duties under this agreement and agree that in this
respect the Director has a special obligation to further
the interests of the Company.
b)If at any time during his employment under this agreement
the Director makes or discovers or participates in the
making or discovery of any Intellectual Property relating
to or capable of being used in the business for the time
being carried on by the Group and whether or not made or
discovered by the Director in the course of his
employment hereunder, full details of the Intellectual
Property shall immediately be communicated by him to the
Company and shall be the absolute property of the
Company. At the request and expense of the Company the
Director shall give and supply all such information,
data, drawings and assistance as may be requisite to
enable the Company to exploit the Intellectual Property
to the best advantage and shall execute all documents and
do all things which may be necessary or desirable for
obtaining patent or other protection for the Intellectual
Property in such parts of the world as may be specified
by the Company and for vesting the same in the Company or
as it may direct.
c)The Director irrevocably appoints the Company to be his
attorney in his name and on his behalf to sign, execute
or do any such instrument or thing and generally to use
his name for the purpose of giving to the Company (or its
nominee) the full benefit of the provisions of this
clause and in favour of any third party a certificate in
writing signed by any director or the secretary of the
Company that any instrument or act falls within the
authority conferred by this clause shall be conclusive
evidence that such is the case.
d)If the Intellectual Property is not the property of the
Company the Company have the right to acquire for itself
or its nominee the Director's rights in the Intellectual
Property within 3 months after disclosure pursuant to the
clause 7 (b) on fair and reasonable terms to be agreed or
settled by a single arbitrator.
e)Rights and obligations under this clause shall continue
in force after termination of this agreement in respect
of Intellectual Property made during the Director's
employment under this agreement and shall be binding upon
his representatives.
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8. PENSIONS
The Director shall be eligible to be a member of the Boxmore
Group Pension Scheme Chief Executive Category, or any
successor plan which maintains similar benefits and operates
on similar terms, subject to the rules of the Scheme from
time to time. Alternative pension scheme arrangements, may
be agreed between the Director and the Company at any time
by mutual agreement.
9. OTHER BENEFITS
a)Subject to age and medical examination, the results of
which are reasonably satisfactory to the Company and its
insurers, the Company undertakes to provide life
assurance cover equal to four times salary if and to the
extent that such cover is not provided by the Director's
pension arrangements referred to in clause 8 and to
procure that the Director will join Boxmore's prolonged
disability insurance arrangements.
b)The Company will provide contributions on the national
scale of B.U.P.A. Company Care Scheme or such other
agreed medical care scheme as approved by the Company on
behalf of the Director and his wife and children under
eighteen years of age.
10. EXPENSES
There shall be paid or refunded to the Director such sums as
shall cover all vouched, authorised and reasonable out of
pocket expenses incurred by him on the Group's business
including inter alia expenses of entertainment subsistence
and travelling in accordance with the Company guidelines.
11. CAR
During the continuance of this Agreement the Company shall
provide, maintain, tax and insure for the Director a motor
vehicle on terms in line with the Company's policy from time
to time as laid down. The car is provided for the use of
the Director in the performance of his duties. The Director
may use the said motor vehicle for his private purposes
which shall include occasional use by his immediate family.
The Company shall reimburse the Director the fuel and
running expenses including all fuel and running expenses
incurred by reasonable private use. The Company may provide
the choice to take up the option of a discretionary car
allowance as an alternative to the provision of a company
car. If this option is chosen the Director is required to
use a suitable personal vehicle to fulfil his normal duties
and associated travel requirements. If the Director shall
be convicted of any offence (under the Road Traffic Acts) or
become involved in any accident involving the motor car, he
shall forthwith notify the Company and supply such
information in connection therewith as the Company may
request.
12. HOLIDAYS
a)The Director shall be entitled in addition to the normal
public holidays to twenty five days annually accrued on a
pro rata basis per month at full salary to be taken at
such time or times as agreed by the company.
b)In the respective holiday years in which this agreement
commences or terminates the Director's entitlement to
holiday shall accrue on a pro rata basis for each month
of service during the relevant year which is normally the
Company accounting year.
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c)Holiday entitlement for one year may not be taken in
subsequent holiday year unless otherwise agreed by the
Company.
13. LOCATION
During the continuance of this Agreement, the Director's
place of work shall initially be the Company's office at
Xxxxx Xxxxx, Xxxxxxxxxx Xxx, Xxxxxxxx Xxxxxxxxxx Xxxxxx,
Xxxxxxxxxxxx, XX00 0XX or such other location that may be
mutually agreed between the Company and the Director. The
Director shall be expected to travel within Europe and
Overseas if necessary, but not on an unreasonable basis, in
the performance of his duties.
14. SICKNESS/INCAPACITY
Without prejudice to Clause 15 (d) hereof, in the event of
the Director being unable to carry out his duties hereunder
because of ill health or accident and provided that the
Director produced such medical evidence of incapacity as may
be required by the Company, the Company shall continue to
pay to the Director the salary and provide the benefits
determined in accordance with these provisions for the
period of up to 12 months from the date of his incapacity
(including any period of paid notice in accordance with
clause 15 (d)) or for such longer period as the Company
shall in their absolute discretion think fit. Provided that
the Company shall be at liberty to deduct the amount of any
social security benefits and prolonged disability insurance
received by the Director and the Director shall use his best
endeavours to obtain any social security benefits and
prolonged disability insurance to which he may be entitled.
PROVIDED THAT if the incapacity shall be or appear to be
occasioned by actionable negligence of a third party in
respect of which damages are or may be recoverable the
Director shall forthwith notify the Company of that fact and
of any claim, compromise settlement or judgement made or
awarded in connection therewith and shall give to the
Company all such particulars of such matters as the Company
may reasonably require and shall if so required refund to
the Company such sum (not exceeding the amount of damages
recovered by him under such compromise settlement or
judgement less any costs in or in connection with or under
such claim compromise settlement or judgement borne by the
Director and not exceeding the aggregate of the remuneration
paid to him by way of salary in respect of the period of the
incapacity) as the Company may determine.
15. TERMINATION OF EMPLOYMENT
a)If this Agreement is terminated by the Director he shall
be entitled only to any arrears of gross salary and
expenses outstanding at the date of termination.
b)If this Agreement is terminated as a result of the death
of the Director his personal representative shall be
entitled to:-
(i) any arrears of gross salary and expenses
outstanding at the date of termination and also,
(ii) a proportionate part of any bonus entitlement and
all other benefits hereunder payable hereunder for the
then current financial year of the Company up to the
date of such termination.
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c)If before the expiration of the Agreement the employment
of the Director hereunder shall be terminated by reason
of the liquidation of the Company for the purpose of
amalgamation or reconstruction or as part of any
arrangement for the amalgamation of the undertaking of
the Company not involving liquidation and the Director
shall be offered employment with the amalgamated or
reconstructed company for a period not less than the
unexpired term of this Agreement and on terms not less
favourable than the terms of this Agreement, the Director
shall have no claim against the Company or any member or
members of the Group or the amalgamated or reconstructed
company or any one or more of them in respect of the
termination of his employment by the Company hereunder.
d)Without prejudice to the provisions of clause 14 above
and the Director's rights at common law or at statute
this Agreement may be terminated by the Company:
By six months notice in writing given at any time after
the Director has been permanently incapacitated by
accident or ill health from performing his duties for six
consecutive months. Under this Agreement and for the
purposes of this sub-clause incapacity for an aggregate
period of nine months in any period of 24 months or for
an aggregate period of 24 months in any 5 year period
shall be deemed to be permanent incapacity. A period of
continuous incapacity of more than three months or in
aggregate of more than six months but less than nine
months in any year shall at the discretion of the Company
be referred to an independent medical consultant approved
by the Director and the Company who shall be asked to
state whether in his opinion the incapacity should be
considered a permanent incapacity. For the avoidance of
doubt, the Company may terminate the Director's
employment hereunder notwithstanding that this will not
effect the Director's entitlement to benefits under the
prolonged disability insurance scheme referred to in
Clause 9 above.
e)Without prejudice to the provisions of clause 14 above
and the Director's rights at common law or at statute
this Agreement may be determined by the Company, by
summary notice in writing to the Director upon the
happening of any of the following events after the date
of this Agreement namely:
(i) If he shall be guilty in the opinion of the
Company of any gross misconduct in connection with the
Company's affairs or after having been given adequate
written notice of any serious breach or persistent non-
observance of any of the conditions of this Agreement
on his part to be performed or observed or shall
neglect or refuse to carry out any of his duties
hereunder.
Gross misconduct offences, will render the Director
liable to summary dismissal (ie dismissal without
notice).
(ii) If he shall have been guilty of misconduct other
than specified in (i) above after having received
appropriate verbal and final written warnings.
(iii) If he should fail to perform his duties to a
satisfactory standard in the opinion of the Company
after having received appropriate verbal and final
written warnings.
(iv) If he shall become bankrupt or make any
arrangement or composition with his creditors.
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(v) If he shall be convicted of a criminal offence
other than an offence under the Road Traffic Laws,
which in the reasonable opinion of the Company
prejudicially affects his position as a Director as
aforesaid of the Company.
(vi) If he shall not perform in an acceptable manner
and in particular if this is borne out by the poor
performance against pre-determined and agreed budgeted
financial performance for the Company.
f) Upon the termination of this Agreement for whatsoever
reason the Director shall upon the request of the
Company resign without claim for compensation from all
offices held by him in the Company and Group and in the
event of this failure to do so the Company is hereby
irrevocably authorised to appoint some person in his
name and on his behalf to execute any documents and to
do all things requisite to give effect thereto.
g) If during his employment under this Agreement the
Director voluntarily resigns as a Director of the
Company, his employment hereunder will terminate
automatically by reason of that resignation.
h) If the Director ceases to be a Director other than as
provided in Clause 15g above his employment shall
nevertheless continue unless determined by the Company
or the Director in accordance with the provisions of
clauses 2 or 19 of this Agreement.
i) During any period of notice of termination (whether
given by the Company or the Director) the Company shall
be under no obligation to assign any duties to the
Director and shall be entitled to exclude him from its
premises provided that this shall not affect the
Director's entitlement to receive his normal salary and
other contractual benefits.
16. RETURN OF PAPERS, ETC
On the expiration or sooner determination of this Agreement
howsoever the Director shall forthwith surrender -
a)All documents, books, papers and other things whatsoever
in his possession by reason of his Directorship in the
Company, and
b)All property of the Group in his possession or control
including the motor car, car keys and any other property.
17. NOTICES
Any notice hereunder shall be in writing and shall be
sufficiently served in the case of the Director by being
served personally on him or either being left at his usual
or last known place of abode or posted by recorded delivery
post to his usual or last known place of abode and in the
case of the Company by being delivered to or sent by
recorded delivery post to the registered office of the
Company. Any notices posted by recorded delivery post shall
be deemed to have been received seventy-two hours after the
time of posting.
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18. PREVIOUS AGREEMENTS
This Agreement shall be deemed to be in substitution for all
existing agreements of service between the Company and the
Director which shall be deemed to have been cancelled with
effect from the date hereof.
19. TERMINATION FOLLOWING CHANGE OF OWNERSHIP
a)If this Agreement is terminated (for whatever reason) by
written notice and such notice is given either:-
(1) by the Director to the Company any time up to and
including the date 12 months from the date of
commencement of this Agreement; or
(2) by the Company to the Director any time up to and
including the date 18 months from the date of
commencement of this Agreement,
then the Company and the Director will agree an effective
date of termination ("EDT") and on the EDT the Director
shall receive a payment of compensation equivalent to 3
years' Gross Remuneration. Gross remuneration for the
purposes of this clause 19 means basic salary and the
monetary value of all benefits-in-kind (based on the
previous year's benefits) together with pension
contributions but excludes bonus entitlements.
b)With effect from 12 months from the date of commencement
of this Agreement (and in the event notice has not been
given in accordance with clause 19 (a) above) the period
of notice to be given by the Director to the Company will
be 12 months (in accordance with clause 2 (a) of this
Agreement).
With effect from 18 months from the date of commencement
of this Agreement (and in the event notice has not been
given in accordance with clause 19 (a) above) the period
of notice to be given by the Company to the Director will
be 24 months (in accordance with clause 2 (a) of this
Agreement) or upon such termination, subject to the
provisions of clause 19 (c), the Director shall be
entitled to compensation, including payment in lieu of
notice, equivalent to two years' gross remuneration.
c)Following the expiry of the periods referred to in clause
19(a) after the commencement date of this Agreement,
where employment terminates in the event of a successful
bid for the Company or a change in control of Chesapeake
Corporation (as defined in the Chesapeake Corporation
Benefits Plan Trust), the following provisions should
apply:
(i) If following a Takeover the Company or a change in
control of Chesapeake Corporation the Director's
employment is terminated, except as set forth under
Clause 14 or 15, or the Director resigns following
the occurrence of:
1) a material adverse alteration in the nature of
the Director's responsibilities or a material
diminution in the Director's status; or
2) a material breach by the Company of any of the
Terms herein; or
3) the assignment to the Director of any duties
inconsistent with the position held by the
Director immediately before the Takeover.
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4) a requirement that the Director relocate his
principal place of employment to a location
that is at least 50 miles farther from his
principal residence than his former principal
place of employment.
The Company shall forthwith compensate the Director
by paying to him and he will accept as liquidated
damages in full and final settlement of all the
Director's claims arising from such termination a
sum equivalent to three years average total gross
remuneration, including salary, bonus, pension
contributions and benefits in kind.
(ii) For the purposes of this clause a Takeover is
defined as arising if any person acquires, by a
series of transactions or otherwise, shares of the
Company which together with shares held or acquired
by persons acting in consert (being the meaning or
similar given to this expression in the City Code of
Takeovers and Mergers) with that person carrying
more than 50% of the voting rights.
20. GRIEVANCE PROCEDURE
If the Director wishes to obtain redress of any grievance
relating to his Employment, or is dissatisfied with any
reprimand, suspension, or other disciplinary step taken by
the Company, he shall apply in writing to the Executive Vice
President - Human Resources setting out the nature and
details of any such grievance of dissatisfaction. There are
no special disciplinary rules which apply to the Director
and any disciplinary matters affecting him will be dealt
with by the Company's nominated officers.
21. GOVERNING LAW/ARBITRATION
This Agreement is governed by and shall be construed in
accordance with the laws of Northern Ireland and the parties
hereby submit to the jurisdiction of the Northern Ireland
courts.
IN WITNESS whereof this Agreement has been signed by or on
behalf of the parties hereto the day and year first herein
written.
Signed by Xxxxxx X Xxxxxxx
On behalf of the Company
In the presence of:
Signed by Xxxx Xxxxx
In the presence of:
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