Dated 16 April 1997
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(1) DSL GROUP LIMITED
- and -
(2) THE XXX. XXXXXXX XXXXXXXX XXXXXXX MBE
- and -
(3) ARMOR HOLDINGS, INC.
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SERVICE AGREEMENT
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ASHURST XXXXXX XXXXX
Xxxxxxxxx Xxxxx
0 Xxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Tel: 0000-000-0000
Fax: 0000-000-0000
AN AGREEMENT made on 16 April 1997
BETWEEN:-
(1) DSL GROUP LIMITED (registered number 3206563) whose registered
office is at Xxxxxxxx Xxxxx, 00 Xxxxxxxxxx Xxxx, Xxxxxx XX0X 0XX
(the "COMPANY");
(2) THE XXX. XXXXXXX XXXXXXXX XXXXXXX MBE of 00 Xxxxxxxxx Xxxx, Xxxxxx
XX0 0XX (the "EXECUTIVE"); and
(3) ARMOR HOLDINGS, INC., whose principal place of business is at 00000
Xxxxxxxxxxxxx Xxxxxxx, Xxxxxxxxxxxx, Xxxxxxx 00000 XXX ("AHI").
IT IS AGREED as follows:-
1. INTERPRETATION
1.1 In this Agreement the following words and expressions shall have the
following meanings:-
"ACQUISITION AGREEMENT" means the agreement of today's date between,
inter alios, the executive and AHI relating to the sale and purchase
of shares in the Company;
"THE ACT" means Employment Protection (Consolidation) Xxx 0000;
"BOARD" means the board of directors of the Company from time to time;
"CHAIRMAN" means the Chairman of the Board from time to time;
"EFFECTIVE DATE" means the date of this Agreement;
"GROUP COMPANY" means any company which from time to time is:-
(a) a subsidiary undertaking of the Company;
(b) a holding company of the Company;
(c) a subsidiary undertaking of any such holding
company; or
(d) an associated company being any company in which the
Company or any Group Company has a shareholding of
25% or more or any company which has a shareholding
of 25% or more in the Company or any Group Company;
"subsidiary" and "holding company" have the meanings attributed to
them by section 736 of the Companies Xxx 0000;
"PENSION SCHEME" means The DSL Group (1995) Pension Scheme or such
other pension scheme that may be substituted therefor by the
Company;
"TERM" means the period of the Executive's employment hereunder;
"TERMINATION DATE" means (other than for the purposes of Schedule 2
to this Agreement) the date on which the employment of the Executive
under this Agreement shall terminate for whatever reason, and
derivative expressions shall be construed accordingly.
1.2 Words and phrases which are not defined in this Agreement but which
are defined in the Act, the Companies Xxx 0000, or the Insolvency
Xxx 0000 shall be construed as having those meanings.
1.3 References to any statute or any statutory provision shall be
construed as references to the statute or statutory provision as in
force at the date of this Agreement and as subsequently re-enacted
or consolidated and shall include references to any statute or any
statutory provision of which it is a re-enactment or consolidation.
1.4 Unless the context otherwise requires references in this Agreement
to the masculine gender shall, where appropriate, be deemed to
include the feminine and vice versa.
1.5 The Schedules to this Agreement are an integral part of this
Agreement and references to this Agreement include reference
thereto.
2. APPOINTMENT AND TERM
2.1 The Company shall employ the Executive and the Executive shall serve
the Company on the terms set out in this Agreement.
2.2 The Executive's employment under this Agreement shall commence on
the Effective Date and continue (subject to the provisions of this
Agreement) until the third anniversary of the date hereof whereupon
the Executive's employment under this Agreement shall forthwith
terminate unless otherwise agreed in writing between the parties.
2.3 For the purposes,of the Act the Executive's previous employment with
Defence Systems Limited count as part of the Executive's continuous
employment with the Company. The Executive's continuous employment
accordingly began on 3 June 1991.
2.4 The Executive represents to the Company that he is entitled to enter
into this Agreement and to implement and carry out its terms and
that by so doing he shall not be in breach of any
obligation (contractual or otherwise) to any third party which would
entitle that third party to damages or any other remedy at law.
2.5 If in the financial year ending 31 December 1997 the Company does
not achieve 100 per cent of the operating profit forecasted in the
annual budget approved by the Board and
the board of Directors of AHI for that year the Executive's
employment hereunder shall be deemed to continue (subject to the
provisions of this Agreement) until the second anniversary of the
date hereof whereupon the Executive's employment under this
Agreement shall forthwith terminate unless otherwise agreed in
writing between the parties.
3. DUTIES
3.1 The Executive shall perform the duties and exercise the powers which
from time to time may be assigned to him or vested in him by the
Board and shall devote the whole of his time, ability and attention
to his duties under this Agreement during normal office hours and
such other times as may be reasonably required for the proper
performance of his duties and he shall use his utmost endeavours to
promote the interests of the Company and any Group Company and shall
not knowingly do or willingly permit to be done anything to the
prejudice, loss or injury of the Company or any Group Company and
shall carry out such duties in a competent manner. The Executive
shall not be entitled to any additional remuneration for work
performed outside normal office hours.
3.2 The Board shall be entitled at any time to require the Executive to
perform services not only for the Company but also for any Group
Company including, if so required, acting as a director of any Group
Company.
3.3 The Executive shall at all times keep the Board promptly and fully
informed (in writing if so requested) of his conduct of the business
or affairs of the Company and any Group Company and provide such
explanations of his conduct as the Board may require.
3.4 Notwithstanding the provisions of clause 3.1, the Company may at any
time following the giving of notice by either party to terminate
this Agreement and for such period as it may specify not exceeding
the length of notice given cease to provide work for the Executive
in which event, during such period the other provisions of this
Agreement including those relating to the Executive's remuneration
shall continue to have full force and effect but the Executive shall
not be entitled to access to any premises of the Company or any
Group Company.
3.5 Subject always to clause 4, during the Term the Executive shall not
without the prior written consent of the Board engage in any
activities, public office or other occupation outside his employment
which may detract from the proper and timely performance of his
duties under this Agreement.
3.6 The Executive's principal place of work shall be at the principal
place of business of the Company in the United Kingdom or such other
location in the United Kingdom as may be required by the Company
from time to time and he shall undertake any travel as may be
necessary for the proper performance of his duties as the Board may
from time to time require.
4. CONFLICTS OF INTEREST AND DEALINGS IN SECURITIES
4.1 During the Term the Executive shall not whether alone or jointly
with or on behalf of any other person, firm or company and whether
as principal, partner, manager, employee, contractor, director,
consultant, investor or otherwise (except as a representative or
nominee of the Company or any Group Company or otherwise with the
prior consent in writing of the Board) be engaged, concerned or
interested in any other business which:-
4.1.1 is wholly or partly in competition with any business
carried on by the Company or any Group Company; or
4.1.2 as regards any goods or services is a supplier to or
customer of the Company or any Group Company, provided that
the Executive may hold (directly or through nominees) by
way of bona fide personal investment any units of any
authorised unit trust and up to five per cent of the issued
shares, debentures or other securities of any class of any
company whose shares are listed on a recognised investment
exchange within the meaning of the Financial Services Xxx
0000 or dealt in the Alternative Investment Market.
4.2 The Executive acknowledges that he shall not enter into any
transaction which contravenes the insider dealing provisions
contained in Part V of the Criminal Justice Xxx 0000.
4.3 The Executive undertakes at all times to comply with the share
dealing rules adopted from time to time by the Company.
5. SALARY AND BONUS
5.1 Subject to clause 5.2 the Executive shall receive a fixed annual
salary of (pound)116,424 which shall accrue from day to day and be
payable by equal monthly instalments in arrear on the last working
day of each calendar month or such salary (which may not be lower)
as may be agreed and confirmed to the Executive in writing by the
Board in its sole discretion from time to time.
5.2 For the year ending 31 December 1997 if the Company does not achieve
75 per cent of the operating profit forecasted in the annual budget
approved by the Board and the Board of Directors of AHI, the
Executive shall receive, for the year ended 31 December 1998, a
fixed annual salary of (pound)100,000 PROVIDED THAT if in the year
ending 31 December 1998 the Company achieves 100 per cent of the
operating profit forecasted in the annual budget for
such year then the fixed annual salary of the Executive shall be
increased to (pound)116,424 in respect of the year ending 31
December 1999 plus any further increase which the Board and the
Board of Directors of AHI may approve.
5.3 In addition to the Executive's fixed annual salary, he shall receive
an annual bonus in respect of each financial year of the Company
calculated on the basis and in accordance with the definitions set
out in Schedule 3. The Board reserves the right to amend the terms
of the bonus calculation at any time.
5.4 The Executive shall not be entitled to any fees in respect of any
directorship of the Company or any Group Company and to give effect
to this clause the Executive shall forthwith pay to the Company or
procure that the Company is paid all such fees received.
5.5 Payment of such salary and such bonuses (if any) to the Executive
shall be made either by the Company or by another company in the
Group and, if by more than one company, in such proportion as the
Board may from time to time think fit.
5.6 In addition there shall be refunded to the Executive such sums as
shall cover all reasonable out of pocket expenses incurred by him on
the Group's business (including hotel expenses and expenses of
subsistence and travelling), which said expenses shall be evidenced
in such manner as the Company may require.
6. CREDIT CARD
If the Company shall make any credit card available to the
Executive, the Executive shall:-
6.1 take good care of such card and forthwith report any loss of such
card to the Board;
6.2 use the card only for the purposes of the Group's business; and
6.3 return the card forthwith to the Company on request.
7. PENSION AND OTHER BENEFITS
7.1 The Executive is eligible for membership of the Pension Scheme
subject to the rules of the Pension Scheme from time to time. The
Company shall contribute to the Pension Scheme at a rate according
to its discretion acting on the advice of the Actuary as defined in
the rules of the Pension Scheme. The Executive's contributions to
the Pension Scheme will be deducted from his salary and paid by the
Company to the trustees of the Pension Scheme subject to any Inland
Revenue limits and in accordance with the rules of the Pension
Scheme. A copy of these rules will be supplied by the Company on
request.
7.2 A contracting-out certificate under the Xxxxxxx Xxxxxxx Xxx 0000 is
not in force for the Executive's employment.
7.3 During the Term, the Company shall pay in respect of the Executive,
his spouse and dependent children up to the age of 18 years of age
premiums to a private medical insurance scheme in accordance with
the information describing the Company's medical insurance
arrangements which has already been supplied to the Executive.
7.4 During the Term the Executive shall participate at the Company's
expense in such life and personal accident/injury insurance schemes
as the Company shall from time to time maintain for the benefit of
senior executives.
7.5 Any benefits available under clauses 7.3 and 7.4 above are subject
to the rules of the relevant scheme from time to time in force.
8. HOLIDAYS
8.1 The Executive shall be entitled (in addition to the usual public and
Bank holidays in England and Wales) to 30 days' holiday on full pay
in every calendar year to be taken at such reasonable time or times
as the Board shall approve. Any holiday not so used in a calendar
year may not be carried forward without the approval of the Board.
8.2 For the calendar year in which the Executive's employment commences
the Executive shall be entitled to his annual holiday entitlement
calculated on the basis of 2 days' holiday for each completed
calendar month of service in the then current calendar year. Upon
termination of the Executive's employment the Executive shall either
be entitled to salary in lieu of any outstanding holiday entitlement
(calculated on the basis aforesaid) or be required to repay to the
Company any salary received in respect of holiday taken in excess of
his holiday entitlement such salary to be calculated on the basis of
1/227 of the fixed annual salary payable to the Executive pursuant
to clause 5.1 for each day of outstanding or excess holiday
entitlement as appropriate.
8.3 If this Agreement is terminated under clause 11.4, the Executive
will not be entitled to any payment in lieu of holiday not taken at
the Termination Date.
9. ILLNESS OR ACCIDENT
9.1 The Executive shall from time to time at the request and expense of
the Company submit to medical examinations and tests by a medical
practitioner nominated by the Company, the results of which shall,
subject to the provisions of the Access to Medical Reports Act 1988
(as applicable), be disclosed to the Company.
9.2 If the Executive is absent from his duties as a result of sickness
or injury for a period of seven days or more he will at the request
of the Company produce medical certificates to the Company in
respect of this absence.
9.3 If the Executive shall be absent for up to a maximum of 130 working
days in any rolling period of twelve months owing to accident or
illness so that he is unable properly to perform his duties he shall
continue to be entitled to his full salary excluding any bonus or
commission during any period of absence up to a maximum of 130
working days in any rolling period of 12 months provided that if at
any time during such a period of absence referred to above the
Executive becomes eligible to receive benefits under a permanent
health insurance policy in respect of which the Company or any Group
Company has paid premiums on behalf of the Executive or under any
Social Security legislation the Company shall be entitled to set off
or deduct the amount of any such benefits from the salary payable to
the Executive under this clause. During any such period of absence,
the Company shall be entitled at any time to appoint a further
executive director or employee to perform the Executive's duties and
to exercise his powers.
9.4 The Company shall pay the Executive all sums payable by way of
statutory sick pay in accordance with the legislation in force at
the time of absence and any remuneration paid shall be deemed to be
inclusive of statutory sick pay.
9.5 If the Executive's absence shall be or appear to be occasioned by
actionable negligence of a third party in respect of which damages
are or may be recoverable, then all sums paid by the Company shall
constitute loans to the Executive, who shall:
9.5.1 forthwith notify the Company of the relevant circumstances
and of any claim, compromise, settlement or judgement made
or awarded in connection therewith;
9.5.2 give to the Company all such particulars of such matters
as the Company may reasonably require; and
9.5.3 if the Executive recovers damages in respect of such
actionable negligence, refund to the Company such sum (not
exceeding the lesser of:
(a) the amount of damages recovered by him (less all
costs and expenses incurred by the Executive in
obtaining such damages) under such compromise
settlement or judgement; and
(b) the sums advances to him in respect of the period
of the incapacity) as the Company may determine.
10. EXPENSES
The Executive shall be entitled to be reimbursed all reasonable
out-of-pocket expenses (including hotel, travelling and
entertainment expenses but excluding any car parking fines or road
traffic offence fines) which he may from time to time be authorised
to incur in the proper performance of his duties, subject to the
production of such receipts or other evidence as the Company may
reasonably require.
11. TERMINATION
11.1 The Company shall at all times be entitled to terminate the Agreement
pursuant to clause 2.2.
11.2 The Company may, at its sole and absolute discretion, terminate the
Executive's employment forthwith at any time by serving a notice
under this clause stating that the Agreement is being determined in
accordance with this clause 11.2 and undertaking to pay to the
Executive within 14 days salary in lieu of any required period of
notice or unexpired part thereof (subject to tax and National
Insurance) together with any accrued holiday entitlement pursuant to
clause 8.2. For the avoidance of doubt, where the Company terminates
the Agreement in accordance with this clause the terms of, inter
alia, clause 12 and Schedule 2 shall remain in full force and
effect.
11.3 Where the Company terminates this Agreement otherwise than in
accordance with clause 2.2 or 11.2 (subject always to clause 11.4),
any damages to which the Executive may be entitled shall be
calculated in accordance with ordinary common law principles
including those relating to mitigation of loss.
11.4 Notwithstanding the provisions of clauses 11.1 and 11.2, the Company
shall be entitled, by notifying the Executive in writing, to
terminate this Agreement and the Executive's employment forthwith
without any payment by way of compensation, damages or otherwise if
the Executive shall:-
11.4.1 commit any act of serious misconduct;
11.4.2 commit any material or persistent breach of any of the terms
or conditions of this Agreement including any wilful neglect
or refusal to carry out any of his duties or to comply with
any instruction given to him by the Board Provided that if
any such breach of the terms and conditions of this
Agreement, or any such neglect or refusal, is capable of
remedy then this subclause shall have effect only if
written notice of that breach is served by the Company on
the Executive specifying that it is served under this
subclause and the Executive shall have failed to remedy
such a breach within 14 days of the service of such notice;
11.4.3 have a bankruptcy order made against him or shall compound
with or enter into any voluntary arrangements with his
creditors;
11.4.4 be charged with or convicted of any criminal offence (other
than an offence under the Road Traffic Acts for which a
penalty of imprisonment cannot be imposed);
11.4.5 be disqualified from holding office in the Company or any
other company under the Insolvency Xxx 0000 or the Company
Directors Disqualification Xxx 0000 or be disqualified or
disbarred from membership of, or be subject to any serious
disciplinary sanction by, any professional or other body,
which undermines the confidence of the Board in the
Executive's continued employment with the Company;
11.4.6 act in any way which may in the reasonable opinion of the
Board bring the Company or any Group Company into disrepute
or discredit;
11.4.7 in his capacity as a director of the Company resign or be
removed, except where this has been required by the Company
pursuant to clause 11.5.1;
11.4.8 transfer or charge or purport to transfer or charge (other
than as permitted by clause 18) any shares in AHI held by
him without the prior written consent (in the case of
charging, such consent not to be unreasonably withheld) of
the Board of Directors of AHI prior to the third
anniversary of the date hereof; or
11.4.9 take any steps to have the shares of common stock of AHI
issued or to be issued to him registered pursuant to the
Registration Rights Agreement entered into
between the Executive and Armor Holdings Inc on the date
hereof (other than in exercise of the Piggy Back Rights as
defined and set out therein) without the prior written
consent of the Board of AHI
in which event, for the purposes of this Agreement, the Termination
Date shall be the date of the written notice terminating the
Executive's employment.
11.5 The Executive shall resign from the Board and the boards of any
Group Company of which he is director:-
11.5.1 if at any time during the Term the Executive is prevented
from performing his duties whether through sickness or
because the Company has exercised its rights under clause
3.4 or otherwise howsoever and the Company requires the
Executive to resign; and in any event
11.5.2 on the Termination Date,
and the Executive shall at the time of signing this Agreement
appoint the Company as his attorney by executing a power of attorney
in the form set out in Schedule 1 to do and sign in his name and on
his behalf any things and documents as may be required under the
constitution of each company to make his resignation effective
(including the transfer (without payment) to the Company or as the
Company may direct may qualifying shares provided by it).
11.6 The proper exercise by the Company of its right of termination under
clause 11.4 shall be without prejudice to any other rights or
remedies which the Company or any Group Company may have or be
entitled to exercise against the Executive.
11.7 If the employment of the Executive under this Agreement shall be
terminated for the purpose of reconstruction or amalgamation only
whether by reason of the liquidation of the Company or otherwise and
he shall be offered employment with any concern or undertaking
resulting from this reconstruction or amalgamation on terms and
conditions no less favourable than the terms of this Agreement then
the Executive shall have no claim against the Company in respect of
the termination of his employment hereunder.
11.8 The Executive shall not at any time during any period when he is
required to cease the performance of his duties under clause 3.4 or
after the Termination Date make any public statements in relation to
the Company or any Group Company or any of their officers or
employees. The Executive shall not after the Termination Date
represent himself as being employed by or connected with the Company
or any Group Company.
11.9 All credit, charge and expense cards, motor cars, car keys and all
books, papers, drawings, designs, documents, records and computer
software kept or made by or in the possession or control of the
Executive relating to the businesses of the Company and any Group
Company and all other property of the Company and any Group Company
are and remain the property of the Company or such Group Company and
the Executive shall
deliver all such items in his possession custody
or control at the Termination Date immediately to the Company.
11.10 If the Executive is entitled to receive any payment in respect of or
attributable to compensation or damages for termination of his
employment hereunder or in lieu of notice such sum shall be payable
in maximum instalments equal to the last monthly fixed salary of the
Executive prior to such termination and the Executive hereby waives
any right to such payment after such termination after he shall have
accepted employment or consultancy with any other person to the
extent that the Executive becomes entitled to receive any
remuneration or any person with whom the Executive is connected
becomes entitled to receive any amount in respect of or referrable
to the provision of services by the Executive to any other person.
11.11 Any right of the Executive to participate in any Option Pool
established by AHI shall be allocated no value in determining any
rights of such Executive to compensation or damages for loss of
office.
12. CONFIDENTIALITY
12.1 The Executive acknowledges that during the Term he shall in the
performance of his duties become aware of trade secrets and other
confidential information relating to the Company, the Group
Companies, their businesses and its or their clients or customers
and their businesses.
12.2 Without prejudice to his general duties at common law in relation to
such trade secrets and other confidential information, the Executive
shall not during the Term or at any time after
the Termination Date disclose or communicate to any person or
persons or make use (other than in the proper performance of his
duties under this Agreement) and shall use his best endeavours to
prevent any disclosure, communication or use by any other person, of
any such trade secrets or confidential information.
12.3 Since the Executive in the course of his employment or by reason of
services rendered for or offices held in any other company may
obtain knowledge of the trade secrets or other confidential
information or such company, the Executive hereby undertakes that he
will at the request and cost of the Company enter into a direct
agreement or undertaking with such other company whereby he will
accept restrictions corresponding to the restrictions herein
contained (or such of them as may be appropriate in the
circumstances) in relation to such products and services and such
area and for such period as such company may reasonably require for
the protection of its legitimate interests.
12.4 The provisions of this clause shall cease to apply to information or
knowledge which comes into the public domain otherwise than by
reason of the default of the Executive.
12.5 For the purposes of clause 12 confidential information shall
include, but not be limited to, all and any information (whether or
not recorded in documentary form or on computer disk or tape) which
relates to:
12.5.1 the business methods, corporate plans, management systems,
finances, maturing new business opportunities or research
and development projects of the Company;
12.5.2 suppliers, their identities and prices;
12.5.3 customers, their identity, needs and requirements;
12.5.4 marketing or sales of any past, present or future product
or service of the Company including without limitation
sales targets and statistics, market share and pricing
statistics, market surveys and plans, market research
reports, sales techniques, price lists, discount structures
and advertising and promotional material;
12.5.5 trade secrets, technical specifications and other technical
information relating to the businesses of the Company; and
12.5.6 all information material to any dispute or litigation
involving the Company.
13. PROTECTION OF BUSINESS INTERESTS
The Executive shall be bound by the provisions of Schedule 2.
14. DISCIPLINARY AND GRIEVANCE PROCEDURE
14.1 Any disciplinary matters affecting the Executive will be dealt with
by the Chairman. There are no specific disciplinary rules affecting
the Executive. Should the Executive wish to appeal against any
disciplinary decision he should submit his appeal in writing to the
Board whose decision on such appeal shall be final.
14.2 If the Executive wishes to seek redress for any grievance relating
to his employment he should first discuss the matter with the
Chairman. If the matter is not then settled he should submit his
grievance to the Board in writing whose decision on such grievance
shall be final.
14.3 In order to investigate a complaint against the Executive, the
Company reserves the right to suspend the Executive on full pay and
to exclude the Executive from any premises of the Company and any
Group Company for so long as it deems necessary to carry out a
proper investigation and to hold any appropriate disciplinary
hearings.
15. NOTICES
Any notice to be given under this Agreement shall be in writing.
Notices may be served by either party by personal service or by
recorded delivery or by first class post addressed to the other
party or by leaving such notice at (in the case of the Company) its
registered office for the time being and (in the case of the
Executive) his last known address and any notice given shall be
deemed to have been served at the time at which
the notice was personally served or if sent by recorded delivery at
the time of delivery as recorded or if sent by first class post on
the second working day after posting or in the case of being left as
appropriate at the registered office or last known address, the date
on which it was so left.
16. DEDUCTIONS
For the purposes of the Wages Xxx 0000 and otherwise the Executive
consents to the deduction from his wages of any sums owing by him to
the Company at any time and he also agrees to make any payment to
the Company of any sums owing by him to the Company upon demand by
the Company at any time. This clause is without prejudice to the
rights of the Company to recover any sums or balance of sums owing
by the Executive to the Company by legal proceedings.
17. GENERAL
17.1 The information in this Agreement constitutes a written statement of
the terms of employment of the Executive In accordance with the
provisions of the Act.
17.2 This Agreement (including its Schedules) constitute the entire and
only legally binding agreement between the parties relating to the
employment of the Executive by the Company or any Group Company and
replaces any previous employment agreements or arrangements.
No variation to this Agreement shall be effective unless made in
writing signed by or on behalf of the parties and expressed to be
such a variation.
17.3 No failure or delay by the Company in exercising any remedy, right,
power or privilege 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, right, power or privilege preclude any
further exercise of the same or exercise of any other remedy, right,
power or privilege.
17.4 No waiver by the Company of any of the requirements of this
Agreement or of any of its rights under this Agreement shall have
effect unless given in writing and signed by the Board. No waiver of
any particular breach of the provisions of this Agreement shall
operate as a waiver of any repetition of that breach.
17.5 If any provision of this Agreement shall be, or become, void or
unenforceable for any reason within any jurisdiction, this shall
affect neither the validity of that provision within any other
jurisdiction nor any of the remaining provisions of this Agreement.
17.6 This Agreement and the rights and obligations of the parties hereto
shall be governed by and construed in accordance with the laws of
England.
17.7 In the event of any claim, dispute or difference arising out of or
in connection with this Agreement the parties hereto irrevocably
agree and submit to the non-exclusive jurisdiction of the Courts of
England.
18. TRANSFER OF SHARES IN AHI
18.1 The Executive shall be permitted to transfer the shares in AHI held
by him to AHI, or as it may direct, if such transfer is in whole or
part satisfaction of a liability of the Executive under the
Warranties in the Acquisition Agreement.
18.2 AHI agrees to accept the surrender to AHI (or as it directs) of any
shares in AHI which the Executive wishes to surrender in order to
satisfy in whole or part a liability in respect of breach of
Warranty under the Acquisition Agreement and agrees that the
liability of the Executive in respect of such breach shall be
treated as discharged to the extent of the market value on the date
of surrender of the AHI shares surrendered.
18.3 If in the financial year ending 31 December 1997 the Company does
not achieve 100 per cent of the operating profit forecasted in the
annual budget approved by the Board and the board of Directors of
AHI for that year the Executive's employment hereunder shall be
deemed to continue (subject to the provisions of this Agreement)
until the second anniversary of the date hereof whereupon the
Executive's employment under this Agreement shall forthwith
terminate unless otherwise agreed in writing between the parties.
18.4 A transfer of shares in AHI by the Executive shall permitted for the
purpose of Clause 11.4.9:
18.4.1 if made within 12 months after the date hereof, only if the
number of such shares transferred by the Executive does not
in aggregate exceed N calculated as follows:
N = (JS - 10)% x E
18.4.2 if made on or after 12 months after but prior to the third
anniversary hereof, only if the number of such shares
transferred by the Executive does not in aggregate exceed N
calculated as follows:
N = (JSWK)% x E
where:
JS = the percentage of the holding of shares in AHI
held by Xxxxxxxx Xxxxxxx transferred by him (while
remaining employed by AHI) after the date hereof but
prior to the date of the transfer by the Executive;
JSWK = the percentage of the aggregate of the holdings of
shares in AHI held by Xxxxxxxx Xxxxxxx and Xxxxxx
Xxxxxxx in aggregate transferred by them (while
remaining employed by AHI) after the date hereof but
prior to the date of the transfer by the Executive;
E = the number of shares in AHI held by the Executive
immediately prior to the date of the transfer by the
Executive; or
18.4.3 if made on or after the second but before the third
anniversary of the date hereof and such transfer would not
result in the aggregate nominal value of all transfers of
such shares by the Executive exceeding 25 per cent in
nominal value of his holding of such shares on the date
immediately following the date hereof .
19. GUARANTEE
19.1 AHI hereby unconditionally guarantees and undertakes to the
Executive that the Company will duly and punctually observe all the
obligations under this Agreement to the extent that if the Company
shall fail for whatever reason to perform such obligations AHI shall
be liable to perform the same in all respects as if AHI were the
party principally bound thereby in place of the Company.
19.2 This Guarantee shall constitute a direct primary and unconditional
liability on AHI and shall not be affected by any time or indulgence
granted to the Company by the Executive or by any act, omission,
deed or matter of whatever description whereby AHI as surety only
would or might have been released PROVIDED THAT AHI shall have the
same rights and defences as against the Executive as are or would be
enjoyed by the Company.
AS WITNESS the hands of the parties hereto or their duly authorised
representatives.
SCHEDULE 1
POWER OF ATTORNEY
By this Power of Attorney made on 1997, I, THE XXX. XXXXXXX XXXXXXXX
XXXXXXX MBE of 00 Xxxxxxxxx Xxxx, Xxxxxx XX0 0XX in accordance with the terms
of the service agreement ("the Service Agreement" of even date between myself
and DSL Group Limited ("the Company") HEREBY APPOINT any director of Armor
Holdings, Inc. ("AHI") to act as my attorney with authority in my name and on
my behalf (so that words and expressions defined in the Service Agreement
shall have the same meanings herein):-
(a) on or after the Termination Date to do any things and sign any
documents as may be required under the constitution of the Company
and each Group Company to make my resignation as a director from
those companies effective;
(b) to sign or execute any and all agreements, instruments, deeds or
other papers and to do all such things in my name as may be
necessary or desirable to implement my obligations in connection
with clause 11.5 of the Agreement;
(c) within 2 days of the Company having requested my resignation
pursuant to clause 11.5.1 to do any thing and sign any documents to
make my resignation as a director from those Companies effective;
(d) on or after the Termination Date to sign or execute any and all
instruments, deeds or other papers and to do all such things in my
name as may be necessary or desirable to implement a transfer of all
my shares in AHI or any subsidiary thereof which I may hold as a
bare nominee; and
(e) to appoint any substitute and to delegate to that substitute all or
any powers conferred by this Power of Attorney.
I declare that this Power of Attorney, having been given by me to secure my
obligations in connection with clause 11.5 of the Service Agreement, shall be
irrevocable in accordance with section 4 of the Powers of Xxxxxxxx Xxx 0000.
IN WITNESS whereof this Power of Attorney has been duly executed.
EXECUTED as a DEED and
DELIVERED
in the presence of:-
Witness name:
Address:
Occupation:
SCHEDULE 2
PROTECTION OF BUSINESS INTERESTS
For the avoidance of doubt, the provisions of this Schedule shall not apply if
this Agreement is terminated by the Company in breach of its terms.
In this Schedule the following words and expressions shall have the following
meanings:-
"Business" the business or businesses of the Company
or any Group Company in or with which the
Executive has been involved or concerned
namely the business of the marketing,
development, design or provision of
security or security related services at
any time during the period of twelve months
prior to the Termination Date;
"directly or indirectly" the Executive acting either alone or jointly
with or on behalf of any other person, firm
or company, whether as principal, partner,
manager, employee, contractor, director,
consultant, investor or otherwise;
"Group Company" AHI, each subsidiary and subsidiary
undertaking thereof (either direct or
indirect) and any other entity in which any
Group Company holds an interest;
"Key Personnel"
any person who is at the Termination Date
or was at any time during the period of
twelve months prior to the Termination Date
employed or engaged as a consultant in the
Business in an executive, senior
managerial or sales capacity and with whom
the Executive has had dealings other than
in a de minimis way during the course of his
employment under this Agreement;
"Prospective Customer" any person firm or company who
has been engaged in negotiations at any
time during the twenty-four months prior to
the Termination Date, with which the
Executive has been personally involved,
with the Company or any Group Company with
a view to purchasing Relevant Services from
the Company or any Group Company;
"Relevant Area" United Kingdom, the African Continent, the
Asian Continent, the Former Yugoslavia, the
Former Soviet Union, the United States of
America and the South American Continent;
"Relevant Customer" any person firm or company who at
any time during the twenty-four months
prior to the Termination Date was a
customer of the Company or any Group
Company, with whom or which the Executive
directly dealt other than in a de minimus
way or for whom or which the Executive was
responsible on behalf of the
Company or any Group Company at any time
during the said period (or the Term if
shorter);
"Relevant Period" the period of 12 months from the
Termination Date less any period during
which the Executive has not been provided
with work pursuant to clause 3.4 of this
Agreement;
"Relevant Services" any services competitive with
those supplied by any Company or Group
Company at any tine during the twelve
months prior to the Termination Date in the
supply of which the Executive was directly
involved or concerned at any time during
the said period;
"Relevant Supplier" any person firm or company who at any time
during the twelve months prior to the
Termination Date was a supplier of any
goods or services (other than utilities and
goods or services supplied for
administrative purposes) to the Company or
any Group Company and with whom or which
the Executive had personal dealings during
the course of his employment under this
Agreement other than in a de minimus way;
and
"Termination Date" the date on which the employment of the
Executive under this Agreement shall
terminate.
1. The Executive shall not without the prior written consent of the Board
directly or indirectly at any time during the Relevant Period:-
1.1 solicit away from the Company or any Group Company; or
1.2 endeavour to solicit away from the Company or any Group Company; or
1.3 employ or engage; or
1.4 endeavour to employ or engage,
any Key Personnel.
2. The Executive shall not without the prior written consent of the Board
directly or indirectly at any time within the Relevant Period:-
2.1 (a) solicit the custom of; or
(b) deal with,
any Relevant Customer or Prospective Customer in respect of any Relevant
Services; or
2.2 (a) interfere; or
(b) endeavour to interfere,
with the continuance of supplies to the Company and/or any Group
Company (or the terms relating to those supplies) by any Relevant
Supplier.
3. The Executive shall not without the prior written consent of the
Board directly or indirectly at any time within the Relevant Period
engage or be concerned employed or interested in any business within
the Relevant Area which (a) competes or (b) will at any time during the
period of six months from the Termination Date compete with the
Business provided that the Executive may hold (directly or through
nominees) by way of bona fide personal investment any units of any
authorised unit trust and up to five per cent. of the issued shares,
debentures or securities of any class of any company whose shares are
listed on a recognised investment exchange within the meaning of the
Financial Services Xxx 0000 or dealt in the Alternative Investment
Market.
4.1 The Executive acknowledges (having taken appropriate legal advice) that
the provisions of this Schedule are fair and reasonable and necessary
to protect the goodwill and interests of the Company and the Group
Companies and shall constitute separate and severable undertakings
given for the benefit of the Company and each Group Company and may be
enforced by the Company on behalf of any of them.
4.2 If any of the restrictions or obligations contained in this Schedule is
held not to be valid on the basis that it exceeds what is reasonable
for the protection of the goodwill and interests of the Company and the
Group Companies but would be valid if part of the wording were deleted
then such restriction or obligation shall apply with such deletions as
may be necessary to make it enforceable.
4.3 The Executive acknowledges and agrees that he shall be obliged to draw
the provisions of this Schedule to the attention of any third party who
may at any time before or after the termination of the Executive's
employment hereunder, offer to engage the Executive in any capacity and
for whom or with whom the Executive intends to work.
SCHEDULE 3
BONUS
The annual bonus to which the Executive shall be entitled in accordance with
clause 5.3 ("the Bonus") shall be calculated as follows:-
1. The Bonus shall be a sum equal to the fixed annual salary (as
aforesaid) multiplied by the Bonus Factor, but shall in no
circumstances be a negative figure.
2. The Bonus shall not exceed a sum equal to 25 per cent. of the fixed
annual salary of the Executive payable under clause 5.1 in respect of
each completed Financial Year of the Company.
3. The Bonus in respect of the Financial Year of the Company in which the
Executive's employment hereunder commences shall bear the same
proportion to the Bonus as would have been payable had the Executive
been employed throughout the Financial Year as the period from the
commencement of his employment to the end of such Financial Year bears
to the whole of such Financial Year.
4. The Bonus Factor for the purposes of this schedule shall be calculated
in accordance with the following formula:-
0.83 x (P - 90)
---------------
100
Where:
P shall be whichever is the lesser of 120 or is the
percentage of Budgeted Profit actually achieved as
evidenced by the audited accounts for the relevant
Financial Year;
Budgeted Profit means the earnings before interest and tax (taking
full account of exceptional items but taking no
account of extraordinary items) budgeted for by the
Company and approved by the board of AHI for the
relevant Financial Year (or for the period from the date
of incorporation of the Company to 31 December 1996) as
evidenced by the annual budget agreed by the Board and
approved by the board of AHI.
5. CERTIFICATION
The Company shall as soon as possible after the audit of the relevant
accounts for each Financial Year has been completed procure that the
auditors deliver to the Executive a certificate stating the amount of
the gross profits of the Company for that period and the Bonus for that
period.
6. PAYMENT
6.1 The Bonus in respect of any Financial Year shall be payable to
the Executive within fifteen business days following the date
on which the annual earnings of AHI for the period to which the
Bonus relates shall have been publicly announced.
6.2 If the Executive's employment hereunder shall terminate
(otherwise than by reason of the proper exercise by the Company
of its rights of termination under clause 11 in which case no
further Bonus shall be payable) during the currency of any
Financial Year the Executive shall not be entitled to receive
any Bonus in respect of that Financial Year, unless otherwise
decided by the Board in its absolute discretion.
7. DETERMINATION
The certificate of the auditors stating the amount of the Bonus shall,
in the absence of manifest error, be final and binding and in giving
such certificate the auditors shall act as experts and not as
arbitrators.
8. RELATIONSHIP TO OTHER BENEFITS
The Bonus will be:-
8.1 excluded from pensionable earnings for the purpose of any
relevant occupational pension and life assurance or permanent
health insurance scheme; but
8.2 (subject to the provisions of any relevant scheme) available
for the purpose of making additional voluntary contributions.
9. The Financial Year shall have the meaning ascribed to it in section 232
of the Companies Xxx 0000.
SIGNED by )
a Director duly authorised )
for and on behalf of )
DSL GROUP LIMITED )
SIGNED by )
THE XXX. XXXXXXX )
XXXXXXXX XXXXXXX MBE )
for and on behalf of )
)
SIGNED by )
a Director duly authorised )
for and on behalf of )
ARMOR HOLDINGS, INC. )
