CONFORMED COPY
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Dated 9 June 1997
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(1) STRONTIAN HOLDINGS LIMITED
(2) ARMOR HOLDINGS, INC.
(3) ALPHA-A LIMITED
(4) XXXXXXX GOLOVATOV
(5) XXXX XXXXXXX
SHARE ACQUISITION AGREEMENT
relating to
GORANDEL TRADING LIMITED
Xxxxxxx Xxxxx Xxxxxxxxxxx
00 Xxxx Xxxx
Xxxxxx XX0X 0XX
Telephone 0000-000 0000
Facsimile 0000-000 0000
CONTENTS
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Clause of Agreement Page
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1 Definitions and interpretation 1
2 Sale of Shares 4
3 Consideration 5
4 Undertakings and Consideration Shares 6
5 Announcements and confidentiality 8
6 Completion 9
7 Costs 9
8 Tax 9
9 General 9
10 Notices 10
11 Applicable law and jurisdiction 11
12 Guarantees 11
13 Dispute Resolution 12
14 Service of Proceedings 13
Schedule
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1 Completion obligations 14
2 Consideration instructions 16
3 Companies in which MG and IO are interested 17
Documents in the approved terms
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1 Services Agreement
2 Termination Agreement
3 Letter of resignation
4 Board minutes of the Company
5 Employment Contract
6 Tax Indemnity
7 Loan Agreement and Pledge
8 Non-Compete Agreements
9 Investment Representation Letter
10 Escrow Agent Letter of Instruction
THIS AGREEMENT is made on 9 June 1997
BETWEEN:-
(1) STRONTIAN HOLDINGS LIMITED, a company incorporated and registered in Cyprus
(Registration No. 56709) whose registered office is at 00 Xxxxxxxxx Xxxxxx,
Xxxx Xxxxxxxx, Xxxxxxx, Xxxxxx ("the Vendor");
(2) ARMOR HOLDINGS, INC. a corporation established under the laws of the state
of Delaware, USA, whose address for the purposes of this Agreement is 13386
International Parkway, Xxxxxxxxxxxx, Xxxxxxx 00000, XXX ("AHI" or "the
Purchaser", as the context may require);
(3) ALPHA-A LIMITED, a joint stock company incorporated and registered at the
Executive Committee of Kujbishevsky, Regional Council of People's Duties in
Moscow on 24 October 1991 (Registration No. N6474) whose official address is at
105023, Xxxxxx, Xxxxxxxxxxxx Xxx., Xxxxxxxx 00 ("xxx Xxxxxxxxx");
(0) XXXXXXX XXXXXXXXX, of 00-00 Xxxxxxxx Xxxxxxxxxx Xxxxxx, Xxxxxx 000000,
Russia ("MG"); and
(5) XXXX XXXXXXX, of 00-00 Xxxxxxxx Xxxxxxxxxx Xxxxxx, Xxxxxx 000000, Xxxxxx
("IO").
IT IS AGREED as follows:-
1. Definitions and interpretation
1.1 The following words and expressions where used in this Agreement have the
meanings given to them below:-
AHI Group AHI, its subsidiaries and associates
for the time being (including, for this
purpose, the Company) and "AHI Group Company"
shall be construed accordingly;
Business in relation to a person, any business of that
person providing Security Goods and Security
Services to any firm, company, organisation
or individual requiring the same in any part
of the Relevant Area, whether carried on by
such person itself or through any agent,
contractor or subcontractor or in conjunction
in whole or part with one or more other
persons;
Business Day a weekday, other than a Saturday, on which
clearing banks are ordinarily open for
business in the City of London;
Client in relation to a person carrying on a
business,
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any person who, in the course of such
business, has been provided with Security
Goods or supplied with Security Services in
the Relevant Area, including any person who
has asked (or enquired about) such business
to provide Security Goods or provide Security
Services in the Relevant Area;
C(pound)1 a unit of currency of Cyprus known as the
Cyprus pound;
Company Gorandel Trading Limited, a company
incorporated and registered in Cyprus
(Registration No. 56442) whose registered
office is at 00 Xxxxxxxxx Xxxxxx, Xxxx
Xxxxxxxx, Xxxxxxx, Xxxxxx;
Completion the performance of the obligations to
complete the sale and purchase of the Shares
in accordance with Schedule 1;
Completion Date the date on which Completion occurs;
Consideration Shares the 28,794 shares of registered common stock
of AHI to be issued as part of the Initial
Consideration as stated in clause 3.1.2;
Deferred Consideration the deferred consideration for the sale and
purchase of the Shares as stated in clause
3.3;
Employment Contract the employment contract in the approved terms
to be entered into on Completion between the
Company (1) and MG (2);
Escrow Agent Instruction Letter the instruction letter in the approved terms
to the Bank of Scotland in its capacity as
Escrow Agent under the terms of this Agreement
to be signed by or on behalf of each of the
parties;
Initial Consideration the initial consideration for the sale and
purchase of the Shares as stated in clause
3.1;
Investment Representation Letter the letter of representation in the approved
terms to be addressed to the Purchaser and
signed by the Vendor, MG and IO;
Joint Venture Agreement the joint venture agreement dated 27 November
1993 between DSL (Overseas) Limited (1), the
Vendor (2), the Company (3), Defence Systems
Limited (4) and the Guarantor
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(5) relating to the Company;
Loan Agreement the loan agreement in the approved terms of
even date herewith between Defence Systems
Limited (1) and the Vendor (2);
Non-Compete Agreements the agreements in the approved terms to be
executed by MG and IO;
Pledge the security in the approved terms by way of
pledge over the Consideration Shares to be
issued to the Vendor to be executed pursuant
to the terms of the Loan Agreement;
Relevant Area as defined in the Services Agreement;
Security Goods all goods and products required in order to
provide Security Services;
Security Services the provision and management of security of
all kinds, including (without limitation)
guard and other protection services, courier
services, logistical management, medical
management, supervision and training of
security personnel, advice and consultation
on all types of security arrangements and on
situations involving security needs,
equipment supply, investigative services and
all services ancillary to or relating to such
matters;
Services Agreement the services agreement in the approved terms
to be entered into on Completion between the
Company and the Guarantor and others ("the
Alpha Companies");
Shares the 500 ordinary shares of C(pound)1 each of
the Company to be acquired by the Purchaser
in accordance with this Agreement;
Termination Agreement the termination agreement in the approved
terms to be entered into on Completion
between DSL (Overseas) Limited (1), the
Vendor (2), the Company (3), Defence Systems
Limited (4) and the Guarantor (5) terminating
the Joint Venture Agreement;
Tax Indemnity the tax indemnity in the approved terms to be
entered into on Completion between the Vendor
and the Purchaser;
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US$ the unit of currency of the USA;
Vendor Group the group of companies comprising each
holding company of the Vendor and each
subsidiary of each such holding company,
excluding the Company.
1.2 Where used in this Agreement the terms "subsidiary" and "holding company"
shall have the meanings respectively attributed to them by the Companies Xxx
0000 at the date of this Agreement.
1.3 A reference to any statutory provision in this Agreement:-
1.3.1 includes any order, instrument, plan, regulation, permission and
direction made or issued under such statutory provision or deriving
validity from it; and
1.3.2 shall be construed as a reference to such statutory provision as
in force at the Completion Date (including, for the avoidance of
doubt, any amendments made to such statutory provision that are in
force at the Completion Date); and
1.3.3 shall also be construed as a reference to any statutory
provision of which such statutory provision is a re-enactment or
consolidation.
1.4 The headings in this Agreement are for convenience only and shall not
affect its meaning.
1.5 References to a clause, Schedule or paragraph are (unless otherwise stated)
to a clause of and Schedule to this Agreement and to a paragraph of the
relevant Schedule.
1.6 A document expressed to be "in the approved terms" means a document, the
terms, conditions and form of which have been agreed by the parties to this
Agreement and a copy of which has been identified as such and initialled by or
on behalf of each of the parties.
1.7 Words importing one gender shall (where appropriate) include any other
gender and words importing the singular shall (where appropriate) include the
plural and vice versa.
2. Sale of Shares
2.1 The Vendor shall sell or procure to be sold with full title guarantee and
the Purchaser shall purchase the Shares upon and subject to the terms and
conditions of this Agreement.
2.2 The Vendor, MG and IO shall procure that the Purchaser acquires good title
to the Shares free from all liens, charges, encumbrances, equities and claims
whatsoever and together with all rights now or hereafter attaching to them.
2.3 The Purchaser shall not be obliged to complete the purchase of any of the
Shares unless the purchase of all of the Shares is completed simultaneously.
2.4 The Vendor, MG and IO jointly and severally warrant, represent and
undertake to the
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Purchaser that:-
2.4.1 the Vendor has the right to dispose of the Shares and the Vendor
is disposing of them free from all liens, charges, encumbrances,
equities and claims whatsoever, together with all rights now or
hereafter attaching thereto;
2.4.2 the Vendor has the requisite power and authority to enter into
and perform its obligations under this Agreement and that the
obligations purported to be so assumed are valid, binding and
enforceable obligations of the Vendor; and
2.4.3 those companies whose details are set out in Schedule 3,
comprise all of the companies carrying on the Business in which MG and
IO are interested, directly or indirectly.
2.5 The Guarantor warrants, represents and undertakes to the Purchaser that it
has the requisite power and authority to enter into and perform its obligations
under this Agreement and that the obligations purported to be so assumed are
valid, binding and enforceable obligations of the Guarantor.
3. Consideration
3.1 The Initial Consideration for the sale and purchase of the Shares shall
be:-
3.1.1 the sum of US$470,000, payable in cash at Completion; and
3.1.2 the sum of US$300,000, payable by the issue of the Consideration
Shares at Completion,
and such cash payment and issue of Consideration Shares shall be made in
accordance with the terms of the instructions set out in Part I of Schedule 2.
3.2 The Consideration Shares shall be issued as fully paid unregistered common
stock of AHI.
3.3 The Deferred Consideration for the sale and purchase of the Shares shall be
the sum of US$600,000 which shall be payable in cash on 30 September 1997
providing that at that time the Purchaser has had established to its reasonable
satisfaction that the Company has met its obligations in relation to all Kazak
and Russian taxes due up to 31 March 1997 (including, without limitation,
social taxes in respect of any employee of the Company) without incurring any
additional expenditure in respect thereof and, in the event, that the Purchaser
has not been so satisfied the Deferred Consideration shall not become payable
until such time as the Purchaser is so reasonably satisfied. The cash payment
of the Deferred Consideration shall, when it becomes due for payment be made in
accordance with the terms of the instructions set out in Part II of Schedule 2.
3.4 As soon as practicable after completion and, in any event, on or before 31
July 1997, the parties shall prepare and agree accounts for the Company
(comprising a profit and loss account and balance sheet to be prepared in
accordance with such accounting policies as the parties shall agree between
themselves) for the period from the day following the last day of the period
for which the last accounts of the Company were prepared until (and
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including) 31 May 1997 ("the Completion Accounts"). Within 15 Business Days
following the agreement of the Completion Accounts, the Purchaser shall pay or
procure the payment to the Vendor of an amount equal to 50 per cent of the
retained profits shown by the Completion Accounts less any amounts owing by the
Vendor pursuant to the Loan Agreement and less any amounts owing by any of the
Vendor, MG, IO or any of the Alpha Companies to a member of the AHI Group ("the
Retained Profit Payment"). The Vendor hereby directs that the Retained Profit
Payment shall be divided and paid in equal proportions to MG and IO.
4. Undertakings and Consideration Shares
4.1 The Vendor undertakes to the Purchaser to procure that MG and IO shall not
for a period of one year from the Completion Date, sell, charge, transfer or
otherwise dispose of all or part of or all or part of any interest in any
Consideration Shares and undertakes to the Purchaser in respect of the
Consideration Shares to be issued to it pursuant to the terms of Part I of
Schedule 2 that it will not during the period in respect of which such shares
are the subject of the Pledge sell, charge, transfer or otherwise dispose of
all or part of or all or part of any interest in such shares and that
immediately following the release of such Consideration Shares (or any part
thereof) from the Pledge, it will transfer such released Consideration Shares
to MG and IO in equal proportions.
4.2 Each of MG and IO undertake to the Purchaser that they will not for a
period of one year from the Completion Date, sell, charge, transfer or
otherwise dispose of all or part of or all or part of any interest in any
Consideration Shares which are either issued to them pursuant to the provisions
of Part I of Schedule 2 or transferred to them pursuant to the provisions of
clause 4.1.
4.3 Promptly following the issue of the same, AHI shall procure that the
certificate(s) for the Consideration Shares are deposited with the Bank of
Scotland ("the Escrow Agent") who shall retain such certificate(s) until one
year from the Completion Date ("the Lock-Up Date"). Subject to clauses 4.4.1
and 4.4.2 at the expiry of such period, the Purchaser shall procure that the
Escrow Agent release such certificate(s) to such persons as may be entitled
thereto.
4.4.1 In the event that there is any ongoing dispute, disagreement, claim or
action (which remains unsettled as at the Lock-Up Date) in relation to this
Agreement, or the Tax Indemnity, or the Services Agreement, or the Employment
Contract or the Non-Compete Agreements, or the Loan Agreement (as the case may
be), in circumstances where any of the Purchaser, the Company, Defence Systems
Limited or DSL (Overseas) Limited (a "Claiming Party") have a claim or action
against any of the Vendor, the Guarantor, MG or IO ("Relevant Persons") then
the parties agree that the certificate(s) in respect of the Consideration
Shares shall continue to be held by the Escrow Agent after the Lock-Up Date
until such claim or action is settled and for these purposes the Escrow Agent
shall be entitled to rely on confirmation in writing from the Purchaser as to
what action the Custodian should take in relation to the Consideration Shares.
4.4.2 If pursuant to a claim or action of the type referred to in clause 4.4.1,
judgement is awarded in favour of a Claiming Party or settlement is otherwise
agreed such that an amount is determined to be owed by any of the Relevant
Persons to the Claiming Party, the parties agree that the Claiming Party shall
be entitled to set-off such amount, firstly,
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against the Consideration Shares and the number of Consideration Shares
representing the said amount and any expenses of sale (by reference to the
market value of the Consideration Shares as at the date of sale pursuant to
this clause) shall be sold to satisfy the amount so owed and each of the
Relevant Persons hereby appoints the Company or any duly authorised
representative of the Company to be its attorney in relation to any such sale
and to carry out all acts and execute all documents (whether by way of deed or
otherwise) which may be necessary or desirable to effect such sale (including,
without limitation, any instrument of transfers). Each of the Relevant Persons
declare that this power of attorney, having been given to secure obligations in
connection with this clause 4.4.2, shall be irrevocable in accordance with
section 4 of the Power of Xxxxxxxx Xxx 0000.
4.5 In consideration of the Purchaser entering into this Agreement, the Vendor
undertakes with the Purchaser that it will not either on its own account or in
conjunction with or on behalf of any other person or persons, whether directly
or indirectly, for the period of:-
4.5.1 5 years from the date of this Agreement, at any time during such period
supply Security Goods to or provide Security Services for any person which is
at the date of this Agreement or was during the immediately preceding period of
twelve months a Client of any Business of any AHI Group Company where such
Security Goods or Security Services are the same as or compete with Security
Goods supplied or Security Services provided in the course of any Business of
any AHI Group Company at the date of this Agreement or during the immediately
preceding period of twelve months;
4.5.2 5 years from the date of this Agreement at any time during such period
solicit or endeavour to solicit the custom of any person which is at the date
of this Agreement or was in the immediately preceding period of twelve months a
Client of any Business of any AHI Group Company for the supply of Security
Goods or the provision of Security Services which are the same as or compete
with those supplied or provided in the course of any Business of any AHI Group
Company at the date of this Agreement or during the immediately preceding
period of twelve months;
4.5.3 5 years from the date of this Agreement, at any time during such period
solicit or entice away or endeavour to solicit or entice away from any AHI
Group Company any person who is at the date of this Agreement, or was during
the immediately preceding period of twelve months, employed in any Business of
any AHI Group Company whether or not such person would commit a breach of his
or her contract of employment by reason of leaving service, save that this
clause 4.5.3 shall not apply to any individual employed by such AHI Group
Company in a purely secretarial or non-managerial administrative role; and
4.5.4 5 years from the Completion Date, at any time during such period carry on
or be engaged, concerned or interested in the Relevant Area in any business
which competes with the Business of any AHI Group Company as the same is
carried on from time to time, other than as holder of common stock of any
company.
4.6 Each of the undertakings contained in clause 4.5 is a separate undertaking
by the Vendor in relation to itself and its interests and shall be enforceable
by the Purchaser separately and independently of their respective right to
enforce any one or more of the other undertakings contained in clause 4.5 and
in the event that any such undertaking shall
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be found to be void but would be valid if some part were deleted or the period
or area of application were reduced, then such undertaking shall apply with
such modification as may be necessary to make it valid and effective.
4.7 The parties hereby agree and acknowledge that the undertakings contained in
clause 4.5 are reasonably necessary to protect the legitimate business
interests of those AHI Group Companies carrying on a Business from time to
time.
4.8 The parties confirm that it is agreed that following Completion the Company
shall enter into an agreement (and MG and IO shall use their respective best
endeavours to procure the same) in relation to the occupation by the Company of
office space (with an area of approximately 80m2) in Xxxxxx 000000, Xxxxxx
xxxxxxxx, 0 Xxxxxxxx 0 ("xxx Xxxxxxxx") and in addition, MG and IO shall use
their respective best endeavours to procure that there is made available for
use by the Company further appropriate office space in the Building, to serve
as a negotiations room and a director's office (which shall be available for
use by MG in his capacity as managing director of the Company) and in respect
of all such occupation by the Company it shall pay rent at the rate of $25,000
until 31 December 1997 (and on the basis that such office space is available
for use by the Company from 1 July 1997) and at the rate of US$75,000 for the
period until 31 December 1998, at which time a revised rent payment shall be
agreed between the Company and MG.
4.9 In relation to the Building, MG and IO shall use their respective best
endeavours to procure that bedroom accommodation in the Building shall be made
available for use by the Company at the rate of US$100 per night save that
there shall be no charge for the use of such bedroom accommodation by directors
of the Purchaser, the Company or DSL Holdings Limited (as the case may be).
4.10 MG and IO undertake to use their respective best endeavours to procure
that any other companies which act as a sub-contractor of the Company pursuant
to the terms of the Services Agreements enters into a non-compete agreement (in
such form as may be required by the Company) in respect of the Client for whom
Security Goods or Security Services are being provided pursuant to the
sub-contract arrangements.
5. Announcements and confidentiality
5.1 No announcement relating to the subject matter of this Agreement or any
matter ancillary to this Agreement shall be made by or on behalf of the parties
to this Agreement without the prior written approval of the other parties
provided that nothing shall prevent the Purchaser making (even in the absence
of the approval of the other parties) any announcement or disclosure required
by law, the American Stock Exchange or any other regulatory authority.
5.2 The Vendor and the Guarantor shall keep confidential and not at any time
after the date of this Agreement disclose or make known in any way to anyone
(other than the Purchaser) or use for its own or any other person's benefit any
know-how or confidential information relating to any of the customers,
suppliers or affairs of the businesses (including any prospective businesses)
of the Company or otherwise relating to the business of the Company.
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5.3 All records, papers and documents in the possession, custody or control of
or kept or made by or on behalf of the Vendor relating to the business or
affairs of the Company and of which the Company does not have a record or copy
shall be deemed to be the property of the Company and all such items shall be
delivered to the Purchaser or as the Purchaser may direct at Completion.
6. Completion
6.1 Completion shall take place at the offices of Xxxxxxx Xxxxx Xxxxxxxxxxx, 00
Xxxx Xxxx, Xxxxxx XX0X 0XX immediately after execution of this Agreement. On
such date the parties shall each perform their respective obligations in
relation to the sale and purchase of the Shares in accordance with and as set
out in the Schedule 1.
7. Costs
Each party shall pay its own costs and expenses incurred in the negotiation,
preparation and execution of this Agreement and each of the Vendor, MG and IO
represent and undertake that none of such costs and expenses have been nor will
prior to Completion be borne by the Company.
8. Tax
On Completion each of the Vendor and the Guarantor shall execute the Tax
Indemnity.
9. General
9.1 No variation of this Agreement shall be effective unless made in writing
signed by or on behalf of all the parties and expressed to be such a variation.
9.2 Any remedy or right conferred by this Agreement on the Purchaser for breach
of this Agreement shall be in addition to and without prejudice to any other
right or remedy available to either of them.
9.3 No failure or delay by the Purchaser or time or indulgence given by it in
or before exercising any remedy or right under or in relation to this Agreement
shall operate as a waiver of the same nor shall any single or partial exercise
of any remedy or right preclude any further exercise of the same or the
exercise of any other remedy or right.
9.4 No waiver by any party of any requirement of this Agreement or of any
remedy or right under this Agreement shall have effect unless given by notice
in writing signed by such party. No waiver of any particular breach of the
provisions of this Agreement shall operate as a waiver of any repetition of
such breach.
9.5 Any release, waiver or compromise or any other arrangement which the
Purchaser gives or enters into with any party to this Agreement in connection
with this Agreement shall not affect any right or remedy of the Purchaser as
regards any other party's liabilities under or in relation to this Agreement
and such other party shall continue to be bound by this Agreement as if it had
been the sole contracting party.
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9.6 Time shall be of the essence of this Agreement, both as regards the dates
and periods specifically mentioned and as to any dates and periods which may by
agreement in writing between the parties be substituted for any of them.
9.7 This Agreement may be executed in two or more counterparts and execution by
each of the parties of any one of such counterparts will constitute due
execution of this Agreement.
9.8 The Vendor, the Guarantor, MG and IO shall and shall procure that any third
party shall, do, execute and perform all such further deeds, documents,
assurances, acts and things as may be necessary to give effect to this
Agreement.
9.9 The provisions of this Agreement shall remain in full force and effect
after Completion so far as they then remain to be observed and performed.
9.10 Each of the Vendor, the Guarantor, MG and IO acknowledges that it is
entering into this Agreement without reliance on any undertaking or
representation given by or on behalf of the Purchaser other than as expressly
contained in this Agreement provided that nothing herein shall exclude the
Purchaser from liability for fraudulent misrepresentation.
10. Notices
10.1 Any notice shall be in writing and signed by or on behalf of the person
giving it. Except in the case of personal service, any notice shall be sent or
delivered to the party to be served at the address stated at the beginning of
this Agreement. Any alteration in such details shall, to have effect, be
notified to the other parties in accordance with this clause.
10.2 Service of a notice must be effected by one of the following methods:-
10.2.1 personally on a director or the secretary of any party and shall be
treated as served at the time of such service;
10.2.2 by prepaid first class post (or by airmail if from one country to
another) and shall be treated as served on the second (or if by airmail the
fourth) Business Day after the date of posting. In proving service it shall be
sufficient to prove that the envelope containing the notice was correctly
addressed, postage paid and posted; or
10.2.3 by delivery of the notice through the letterbox of the party to be
served and shall be treated as served on the first Business Day after the date
of such delivery.
10.2.4 by sending it by facsimile transmission to the number for the party to
whom it is to be sent which is referred to below or if another number shall
have been notified by that party to all the other parties for the purposes of
this clause by notice given in accordance with this clause 10.2, then to the
number of such party which shall have been so notified, for service by
facsimile transmission which purpose the latest notification shall supersede
all previous notifications and shall be treated as served at the time of
transmission. The fax numbers of the parties for the purpose of this clause
10.2 are:
The Purchaser - Fax No. (0000) 000 0000
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The Vendor - Fax No. (007) (000) 000 0000
The Guarantor - Fax No. (007) (000) 000 0000
MG - Fax No. (007) (000) 000 0000
IO - Fax No. (007) (000) 000 0000
11. Applicable law and jurisdiction
11.1 This Agreement shall be governed by and construed in accordance with the
laws of England.
11.2 The parties irrevocably submit for the benefit of the Purchaser to the
non-exclusive jurisdiction of the Courts of England and Wales in respect of any
claim, dispute or difference arising out of or in connection with this
Agreement. Nothing contained in this clause shall be taken to have limited the
right of the Purchaser to proceed in the courts of any other competent
jurisdiction.
12. Guarantees
12.1 In consideration of the Purchaser entering into this Agreement with the
Vendor at the request of the Guarantor, the Guarantor hereby irrevocably and
unconditionally, as primary obligor, undertakes and guarantees to the Purchaser
(as separate undertakings and guarantees) the full, prompt and complete
performance by the Vendor of all its obligations under this Agreement (which
for the purposes of this clause 11 shall be defined to include the Tax
Indemnity) and the due and punctual payment of all sums now or subsequently
payable by the Vendor to the Purchaser under this Agreement when the same shall
become due and undertakes with the Purchaser that if the Vendor shall default
in the payment of any sum under this Agreement the Guarantor shall forthwith on
demand by the Purchaser pay such sum to the Purchaser.
12.2 The guarantees contained in clause 12.1 are continuing guarantees and
shall remain in force until all the obligations of the Vendor under this
Agreement have been fully performed and all sums payable by the Vendor under
this Agreement have been fully paid.
12.3 The obligations of the Guarantor shall not be affected by any act,
omission, matter or thing which, but for this provision, might operate to
release or otherwise exonerate the Guarantor from its obligations or affect
such obligations, including without limitation and whether or not known to the
Guarantor:-
12.3.1 any time, indulgence, waiver or consent at any time given to the Vendor
or any other person;
12.3.2 any compromise or release of or abstention from perfecting or enforcing
any right or remedy against the Vendor or any other person;
12.3.3 any legal limitation, disability, incapacity or other circumstance
relating to the Vendor or any other person or any amendment to or variation of
the terms of this Agreement or any other document referred to in this
Agreement; and
12.3.4 any irregularity, unenforceability or invalidity of any obligations of
the Vendor under this Agreement or the dissolution, amalgamation,
reconstruction or insolvency of the
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Vendor.
12.4 The guarantees contained in clause 12.1 may be enforced by the Purchaser
without the Purchaser first taking any steps or proceedings against the Vendor.
12.5 All payments to be made by the Guarantor shall be made in full, without
set-off or counterclaim and without any deduction whatsoever except to the
extent required by law.
13. Dispute Resolution
13.1 Any dispute arising out of or in connection with this Agreement, including
any question regarding the existence, scope, validity or termination of this
Agreement or this clause (whether arising in contract, tort or otherwise),
shall at the nomination of the party initiating the action be referred to and
finally resolved by Arbitration under the Rule of the London Court of
International Arbitration ("LCIA"), which Rule is deemed to be incorporated by
reference into this clause to the extent not inconsistent with its provisions.
13.2 The arbitral panel shall consist of three arbitrators, all of which at the
time of the arbitration must be independent of the parties. The party
initiating arbitration (the "Claimant") shall nominate its arbitrator in its
request (the "Request"). The other party (the "Respondent") shall nominate one
arbitrator within 30 days of receipt of the Request in accordance with Article
2.1 of the Rules of the LCIA. Where there is more than one Claimant or more
than one Respondent and the Claimants or the Respondents (as the case may be)
cannot agree between themselves on the nomination of an arbitrator, the
Arbitration Court of the LCIA shall forthwith appoint both parties' arbitrators
and such arbitrators shall stand as the parties' nominated arbitrators. Within
30 days of the appointment of the parties' nominated arbitrators by the
Arbitration Court of the LCIA or the nomination of the second arbitrator, the
two arbitrators shall nominate a third arbitrator to be the Chairman of the
tribunal, failing which the Arbitration Court of the LCIA shall forthwith
appoint the Chairman.
13.3 The place of the arbitration shall be London, England and the proceedings
shall be governed by the laws of England.
13.4 The language of the arbitration shall be English and the award shall be in
English.
13.5 The arbitral award may grant any relief deemed by the arbitrators to be
appropriate, including, without limitation, specific performance and
preliminary or interim relief (including but not limited to a preliminary
injunction or temporary restraining order). The arbitral award shall state the
reasons for the award and relief granted, shall be final and binding on the
parties to the arbitration, and may include an award of costs (including the
parties' legal and other costs). Any award rendered may be confirmed, judgment
upon any award rendered may be entered, and such award or the judgment thereon
may be enforced in any court of any state or country having competent
jurisdiction.
13.6 Notwithstanding the other provisions of this clause 13 the Purchaser may
seek from any court of competent jurisdiction any interim, provisional or
injunctive relief that may be necessary to protect the rights or property of
the Purchaser or maintain the status quo during or after the pendency of the
arbitration proceeding, subject to the provisions of Article 13.2 of the Rules
of the LCIA (but excluding therefrom reference to paragraph (h)
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of Article 13.1 save in circumstances where the relief sought from the Court
has already been sought from and refused by the arbitral tribunal). The
institution and maintenance of any judicial action or proceeding for any such
interim, provisional or injunctive relief shall not constitute a waiver of the
right of any party to submit the dispute to arbitration.
13.7 In the event that any or part of any arbitral award is unenforceable
outside the United Kingdom by reason of it granting injunctive relief or
specific performance (whether interim or final relief), the parties to the
arbitration agree that any of them shall be at liberty to apply to any court of
competent jurisdiction for identical relief and further agree that all
decisions of the arbitral tribunal giving rise to such relief shall be treated
by the parties to the arbitration as giving rise to res judicata between them
and may not be reopened by any of them.
14. Service of Proceedings
Each of the Vendor, MG and IO and the Guarantor irrevocably authorises and
appoints Xxxxxxx Xxxxxx of 7th Floor, Egginton House, 00-00 Xxxxxxxxxx Xxxx,
Xxxxxx XX0X 0XX as its agent for service of proceedings in relation to any
matter arising out of or in connection with this Agreement and service on such
agent shall be deemed to be service
on the relevant person.
This Agreement has been duly executed by the parties on the date set out above.
AS WITNESS this Agreement has been executed and delivered as a deed by or on
behalf of the parties the day and year first before written.
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SCHEDULE 1
Completion Obligations
Part I
Obligations of the Vendor, MG and IO
1. The Vendor, MG and IO shall deliver, or procure the delivery of, to the
Purchaser:-
1.1 duly executed transfers of the Shares by the registered holders in favour
of the Purchaser or persons nominated by the Purchaser, the share certificates
and any additional documentation necessary to establish the transferor's title
to the Shares, to authorise the executions of such transfers and to allow the
transferees (subject to due stamping) to be registered in the register of
members of the Company as holders of the Shares including, without limitation
to the generality of the foregoing, the consent of the Central Bank of Cyprus
to such transfer;
1.2 a resignation letter in the approved terms from Xxxx Xxxxxxx;
1.3 evidence satisfactory to the Purchaser that:-
1.3.1 all sums owed by the Company to MG, IO, any member of the Vendor
Group or to any of the Alpha Companies or by MG, IO, any member of the
Vendor Group or any of the Alpha Companies to the Company or (as the
case may be) Defence Systems Limited have been repaid;
1.3.2 any guarantees granted or security or indemnities given by the
Company in respect of obligations of MG, IO, any member of the Vendor
Group or any of the Alpha Companies have been released or discharged;
1.4 an engrossment of the Services Agreement duly executed by the Alpha
Companies;
1.5 an engrossment of the Termination Agreement duly executed by the Vendor;
1.6 an engrossment of the Tax Indemnity referred to in Clause 8, duly executed
by the Vendor;
1.7 an engrossment of the Employment Contract duly executed by MG;
1.8 an engrossment of the Loan Agreement and the Pledge duly executed by the
Vendor;
1.9 engrossments of the Non-Compete Agreements duly executed by MG and IO, as
the case may be;
1.10 the Investment Representation Letter and the Escrow Agent Letter of
Instruction duly signed by or on behalf of the Vendor, MG and IO.
2. The Vendor shall procure (together with the Purchaser) the holding of a
meeting of the board of directors of the Company, at which board resolutions in
the approved terms shall
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be passed.
3. The Vendor shall deliver to the Purchaser or as the Purchaser directs all
records, papers and documents referred to in clause 5.3
Part II
Obligations of the Guarantor
The Guarantor shall deliver to the Purchaser an engrossment of the Termination
Agreement duly executed by it.
Part III
Obligations of the Purchaser
The Purchaser shall, conditionally upon the implementation of the matters set
out in Part I and Part II of this Schedule:-
1. Authorise the telegraphic transfer of US$470,000 in cleared funds to an
account or accounts specified by the Vendor which shall discharge the Purchaser
from its obligation to pay that part of the Initial Consideration payable under
clause 3.1.1 to the Vendor.
2. Deliver to the Vendor an engrossment of the Services Agreement duly executed
by the Company.
3. Deliver to the Vendor an engrossment of the Termination Agreement duly
executed by Defence Systems (Overseas) Limited and by Defence Systems Limited.
4. Procure that the Consideration Shares are issued in the amounts and to the
those persons specified in Schedule 2 and shall procure that the certificates
in respect of the Consideration Shares are lodged with the Escrow Agent, in
accordance with the terms of clause 4.3 which shall discharge the Purchaser
from its obligation to pay that part of the Initial Consideration under clause
3.1.2 to the Vendor.
5. Procure the delivery to the Vendor of an engrossment of the Loan Agreement
duly executed by Defence Systems Limited.
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SCHEDULE 2
Consideration Instructions
Part I - Initial Consideration
1. The Initial Consideration of US$470,000 payable in cash at Completion
pursuant to clause 3.1.1 shall be paid as follows:-
1.1 the sum of US$200,000 shall be paid to MG;
1.2 the sum of US$200,000 shall be paid to IO;
1.3 the sum of US$70,000 shall be paid to the Vendor.
2. The Initial Consideration of US$300,000 payable pursuant to clause 3.1.2
shall be satisfied by the issue of the Consideration Shares as follows:-
2.1 4,799 Consideration Shares shall be issued to MG;
2.2 4,799 Consideration Shares shall be issued to IO; and
2.3 19,196 Consideration Shares shall be issued to the Vendor.
but so that such issues of Consideration Shares shall be subject to the
provisions of clauses 4.1 to 4.3 (inclusive).
Part II - Deferred Consideration
3. The Deferred Consideration of US$600,000 payable in cash pursuant to clause
3.3 shall be paid as follows:-
3.1 the sum of US$300,000 shall be paid to MG; and
3.2 the sum of US$300,000 shall be paid to IO.
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SCHEDULE 3
----------
Companies in which MG and IO are interested
-------------------------------------------
Name of Company Registered Office Registered No.
--------------- ----------------- --------------
1. Xxxxx-X Xxxxxxx 00, Xxxxxxxxxxxx Xxxxxx N6474
Building 27
Moscow
2. Alpha-B Limited 00, Xxxxxxxxxxxx Xxxxxx -
Xxxxxxxx 00
Xxxxxx
0. Alpha-7 Limited 00, Xxxxxxxxxxxx Xxxxxx -
Xxxxxxxx 00
Xxxxxx
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EXECUTED as a DEED by )
STRONTIAN HOLDINGS LIMITED )
acting by its duly )
appointed attorney )
XXXXXXX GOLOVATOV )
XXXXXXX GOLOVATOV
...................................
Attorney
EXECUTED as a DEED by )
ARMOR HOLDINGS, INC. )
acting by:- )
XXXXXXXX XXXXXXX
...................................
Authorised Signatory
EXECUTED as a DEED by )
ALPHA-A LIMITED )
acting by:- )
XXXXXXX GOLOVATOV
...................................
Authorised Signatory
EXECUTED as a DEED by )
XXXXXXX GOLOVATOV ) XXXXXXX GOLOVATOV
in the presence of:- )
XXXX XXXXXX
Solicitor
00 Xxxx Xxxx
Xxxxxx XX0X 0XX
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EXECUTED as a DEED by )
XXXX XXXXXXX )
acting by his duly appointed ) XXXXXXX GOLOVATOV
attorney XXXXXXX GOLOVATOV )
in the presence of:- )
XXXX XXXXXX
Solicitor
00 Xxxx Xxxx
Xxxxxx XX0X 0XX
