CONFORMED COPY
--------------
DEFENCE SYSTEMS LIMITED
as Lender
STRONTIAN HOLDINGS LIMITED
as Borrower
------------------
LOAN AGREEMENT
------------------
EVRIPIDOU, XXXXXXXXXX & CO
16 Xxxxxxxx Xxxxxx Avenue
Eagle House, 10th Floor
Ayioi Omoloyites
Nicosia
THIS AGREEMENT is made the 9th day of June 1997 BETWEEN:-
(1) STRONTIAN HOLDINGS LIMITED, whose registered office is at 00 Xxxxxxxxx
Xxxxxx, Xxxx Xxxxxxxx, Xxxxxxx (the "Borrower"); and
(2) DEFENCE SYSTEMS LIMITED, a company incorporated and registered in
England (Registration No. 1540857) whose registered office is at 7th
Floor, Egginton House, 00-00 Xxxxxxxxxx Xxxx, Xxxxxx XX0X 0XX (the
"Lender").
WHEREAS:-
The Borrower has requested and the Lender has agreed to make available to the
Borrower a loan facility upon the terms and subject to the conditions hereof.
NOW IT IS HEREBY AGREED AS FOLLOWS:-
1. DEFINITIONS
(A) In this Agreement the following terms and expressions shall,
except where the context otherwise requires, have the following meanings:-
"Drawdown Date" means the date upon which the partes agree that the Loan shall
be drawn down.
"Encumbrances" means any mortgage, charge (whether fixed or floating), pledge,
lien, encumbrance, hypothecation, security interest, title, retention or other
security arrangement of any kind.
"Event of Default" means any one of the events referred to in Clause 8.
"Libor" means in relation to the Loan, the rate per annum determined by the
Lender for deposits in dollars for a six month period which appears in the
Financial Times as the Interbank rate fixing on the morning on the Drawdown
Date;
"Loan" means the amount of US$200.000.
"Margin" means 2 percent per annum.
"Pledge" means the pledge of 28,794 shares of Armor Holdings, Inc. (such shares
to be issued to, inter alia, the Borrower pursuant to the terms of the Share
Acquisition Agreement), in a form satisfactory to the Lender.
"Repayment Date" means the date falling 6 calendar months from the Drawdown
Date (including such day).
"Share Acquisition Agreement" means the agreement made between, inter alios,
the Borrower and Armor Holdings, Inc., under the terms of which the Borrower
has agreed to sell 500 ordinary shares of C(pound)1 each in Gorandel Trading
Limited.
"Taxes" means any present or future taxes, levies, duties, charges, fees,
deductions or
- 2 -
withholdings of any nature, and shall include any interest or penalties which
may attach as a consequence of non-payment, and "Tax" and "Taxation" shall be
construed accordingly.
(B) All references in this Agreement to Clauses are to clauses of this
Agreement.
(C) Clause headings are inserted for convenience and ease of reference
only and shall not affect the interpretation hereof.
(D) All words denoting the singular number only shall include the
plural and vice versa.
(E) Words denoting natural persons shall include corporations and vice
versa.
(F) References to any law shall be deemed to include references
thereto as the same may be varied or replaced from time to time or, as
appropriate, as extended, re-enacted or amended.
(G) References in this Agreement to any agreement (including, without
limitation to the generality of the foregoing, this Agreement) or
other document or instrument shall be deemed to include references
thereto as the same may be varied, amended, novated or replaced (as
permitted by this Agreement) from time to time and to all agreements,
documents and instruments stated to be supplemental thereto.
(H)(a) The rule known as the ejusdem generis rule shall not apply and
accordingly general words introduced by the word "other" shall not be
given a restrictive meaning by reason of the fact that they are
preceded by words indicating a particular class of acts, matters or
things; and
(b) General words shall not be given a restrictive meaning by reason
of the fact that they are followed by particular examples intended to
be embraced by the general words.
2. DRAWDOWN
(A) Subject to:-
(i) The Lender having received and found to be satisfactory to
it:-
(a) A copy, certified by a director of the Borrower as
being a true and complete copy and in full force and
effect, of a resolution of the board of directors of
the Borrower approving the execution, delivery and
performance of this Agreement and authorising a person
or persons to sign and deliver on behalf of the
Borrower this Agreement, any other notices, documents
and communications to be given by the Borrower pursuant
to or in connection with this Agreement;
(b) A certified true copy of the memorandum and articles of
association and certificate of incorporation of the
Borrower;
- 3 -
(c) Certified copies of all documents evidencing any other
necessary action, approval or consent with respect to
this Agreement (including, without limitation to the
generality of the foregoing, all governmental and other
official approvals and consents as the Lender deems
appropriate); and
(d) The Pledge duly executed by the parties thereto,
the Borrower may draw, in United States dollars, the entire amount (but not a
part only) of the Loan on the Drawdown Date. If the Loan is not drawn on the
Drawdown Date it shall automatically be cancelled.
3. INTEREST
(A) The Borrower will pay interest on the Loan and each part thereof
from the Drawdown Date until the final repayment of the Loan at the rate of
interest which is equal to the aggregate of:-
(i) LIBOR; and
(ii) The Margin.
(B) Interest at the rate(s) determined as aforesaid shall accrue from
day to day and be calculated on the basis of actual days elapsed and a 360 day
year and shall be paid in arrears on the Repayment Date.
(C) The Certificate of the Lender as to the rate(s) and amount of
interest payable in respect of the Loan shall be conclusive and binding on the
Borrower.
4. REPAYMENT
The Borrower shall repay the entire amount of the Loan (less the
amount (if any) of any deemed repayment or part repayment of the Loan by the
Vendor pursuant to the terms of Clause 3.4 of the Share Acquisition Agreement)
plus all interest accrued thereon on the Repayment Date.
5. REPRESENTATIONS AND WARRANTIES
(A) The Borrower represents and warrants to the Lender as follows:-
(i) The Borrower is a company duly established and
existing under the laws of Cyprus and has the power
and authority to own its assets and to conduct the
business which it conducts and/or proposes to
conduct;
(ii) The Borrower has the corporate power to enter into,
exercise its rights and perform and comply with its
obligations under this Agreement (including
borrowing the full amount of the Loan hereunder);
- 4 -
(iii) The execution of this Agreement on its behalf and
the performance of its obligations hereunder have
been duly authorised by all necessary corporate
action, and the obligations expressed as being
assumed by it hereunder constitute its valid, legal
and binding obligations enforceable against it in
accordance with their terms;
(iv) Neither its execution and delivery of this Agreement
nor its exercise of any of its rights hereunder nor
its performance or observance of any of its
obligations hereunder will:-
(a) cause any indebtedness owing by it to be
prepaid or to become due or capable of
being declared due (with or without demand)
prior to the stated maturity date thereof;
(b) cause any limitation on any of its powers
whatsoever and howsoever imposed, or on the
right or ability of its directors to
exercise such powers, to be exceeded; or
(c) conflict with, or result in any breach of,
any of the terms, covenants, conditions and
provisions of, or constitute a default
under, or result in the creation or
imposition of any Encumbrance upon all or
any part of its undertaking, property or
assets pursuant to the terms of, any
statute, regulation, indenture, mortgage,
deed of trust, agreement or other
instrument, arrangement, obligation or duty
to which it is a party or is subject or by
which it is bound;
(v) The Borrower is not in default under any law,
statute, regulation, indenture, mortgage, trust
deed, agreement or other instrument, arrangement,
obligation or duty by which it is bound;
(vi) No judgment or award has been given or made by and
no litigation, arbitration or administrative
proceeding before or of any court, judicial
authority, tribunal, arbitrator or governmental
agency is taking place, pending or, to the best of
its knowledge, information and belief, being in good
faith threatened against it or against any of its
assets and which would be likely to have a material
adverse effect on its ability to observe and perform
its obligations under this Agreement or which in any
way disputes or calls into question the power or
authority of the Borrower to enter into and perform
any of such obligations;
(vii) No Event of Default has occurred at the date hereof
and no other event which with the giving of notice
and/or lapse of time might constitute an Event of
Default, has occurred;
(viii) There exists no Encumbrance on or over the whole or
any part of the undertaking or assets, present or
future (including uncalled capital);
(ix) The Borrower has not taken any corporate action nor
have any other
- 5 -
steps been taken or legal proceedings been started
or threatened against the Borrower for its winding
up, dissolution or re-organisation or for the
appointment of a receiver, administrator,
administrative receiver, trustee or other similar
officer of any one or more of them or of any or all
of its property;
(x) It is not necessary or advisable in order to ensure
the legality, validity or enforceability of this
Agreement that this Agreement be filed, recorded or
enroled with any court or authority in Cyprus; and
(xi) The Borrower will not be required to make any
withholding or deduction from any payment to become
due from the Borrower hereunder.
6. UNDERTAKINGS
(A) The Borrower shall, except with the prior written consent of the
Lender and until all sums due and to become due from the Borrower under this
Agreement have been paid:-
(i) Keep its property free of all Encumbrances and
adverse claims or payments of any character,
contracts or burdens other than liens arising in the
ordinary course of business where the encumbrancer's
rights to the lien are being disputed by the
Borrower in good faith;
(ii) Forthwith upon it becoming aware of the same give
written notice to the Lender of all litigation,
arbitration or administrative proceedings commenced
before and every judgment or award given or made by
any court, judicial authority or other tribunal or
governmental agency and every notice of default or
adverse claim or demand made by any person, in each
case against the Borrower;
(iii) Immediately upon becoming aware of the occurrence of
any Event of Default or of any other event which,
solely with the giving of notice and/or lapse of
time, might constitute an Event of Default, give
notice thereof to the Lender;
(iv) Carry on its business and affairs in all respects in
a proper and efficient manner;
(v) Not channel funds to any other company or person,
howsoever relating to or connected with the
Borrower, unless this is in the context of an
at-arms-length intra-group trading;
(vi) Not sell, transfer or otherwise dispose of (whether
by one transaction or a series of transactions and
whether at any one time or over a period of time)
the whole or any part of its assets except where
such disposal is made in the ordinary course of
business or otherwise for full value as between a
willing buyer and a willing seller in cash; and
- 6 -
(B) Without prejudice to any other provision of this Agreement the
Borrower undertakes to save harmless and to indemnify the Lender from and
against all loss or damage suffered by the Lender (including but not limited to
claims and demands by and liabilities owing to the Lender) arising from any
failure of the Borrower to observe, perform or comply with any provision of
this Agreement.
7. COMMISSIONS, FEES AND CHARGES
The Borrower shall pay all stamp, documentary and other like duties
and taxes, if any, to which this Agreement, or any other documentation executed
in connection herewith may be subject or give rise and shall indemnify the
Lender against any and all liabilities with respect to or resulting from any
delay or omission on the part of the Borrower to pay any such duties or taxes.
8. DEFAULT
(A) Each of the following events shall be an Event of Default:-
(i) If the Borrower shall commit any breach of or omit
to perform any of the terms and conditions of this
Agreement;
(ii) any representation or warranty made or deemed to be
made by the Borrower pursuant to this Agreement or
in any notice, certificate, instrument or statement
contemplated hereby or made or delivered pursuant
hereto is incorrect;
(iii) If the Borrower ceases or threatens to cease to
carry on all or substantially all of its operations;
(iv) If any action is taken for or with a view to the
winding up of the Borrower or the Borrower becomes
insolvent or is unable to pay its debts or enters
into dealings with any of its creditors with a view
to avoiding, or in expectation of, insolvency or
stops or threatens to stop payments generally or a
receiver is appointed over or an encumbrancer takes
possession of any of the assets of the Borrower;
(v) If at any time it is unlawful for the Borrower to
perform any of its obligations hereunder;
(vi) If a distress or an execution is levied or enforced
or sued out against or if any garnishee order is
made and served in respect of the whole or any part
of the property of the Borrower (or an analogous
proceedings or action is taken in respect of any
such property) and is not discharged within twenty
eight days of being levied, enforced, sued out or
served;
(vii) If the Borrower shall be in default under any
agreement by which it is bound, being a default
which would be likely to have a material adverse
effect on its ability to observe and perform any
obligation hereunder;
- 7 -
(viii) If any order of any court or other tribunal or
governmental agency shall be made, which is likely
to have a material adverse effect on the ability of
the Borrower to observe and perform any obligations
hereunder;
(ix) If any litigation, arbitration or administrative
proceedings are commenced before any court or other
tribunal or governmental agency involving the
Borrower which would in the opinion of the Lender be
likely to have a material adverse effect on the
Borrower;
(x) If any liability of the Borrower for borrowed money
or under any guarantee or indemnity is not paid when
due or any liability of the Borrower for borrowed
money shall become due and payable or capable of
being declared due and payable prior to the stated
maturity thereof;
(xi) If any material adverse change occurs in the
business or financial situation of the Borrower;
(xii) If any governmental or other licence, approval,
authorisation, consent or exemption required to
enable the Borrower to perform any one or more of
its obligations under this Agreement is withdrawn or
modified in any manner which is likely to have a
material adverse effect on the Borrower; or
(xiii) If the Pledge or any material provision of the
Pledge shall at any time and for any reason cease to
be in full force and effect, be declared void or
voidable or shall be repudiated by any party thereto
(other than the Lender) or the validity or
enforceability of the Pledge shall at any time be
contested by any party thereto (other than the
Lender) or any such party shall deny that it has any
liability thereunder or shall give notice
terminating or purporting to terminate its
obligations thereunder.
(B) The Lender may at any time after the happening of an Event of
Default (whether or not notice shall have been given by the Borrower of such
Event of Default) by notice in writing to the Borrower declare the Loan and all
interest accrued and all other sums payable pursuant to this Agreement to be
immediately due and payable, whereupon the same shall become immediately due
and payable.
(C) In the event that the Loan shall be declared immediately due and
payable as aforesaid the Borrower will pay to the Lender all losses (including,
without prejudice to the generality of the foregoing, any losses incurred in
liquidating or employing deposits from third parties acquired or arranged to
effect or maintain the Loan or any part thereof and any loss or profit)
incurred by the Lender as a consequence of any Event of Default and/or the
declaration of the Loan to be immediately due and payable as aforesaid and/or
the timing of any payment subsequently received from the Borrower hereunder, as
to which the certificate of the Lender shall be conclusive.
- 8 -
9. ASSIGNMENT
(A) This Agreement shall be binding upon, and inure to the benefit of,
the Lender and the Borrower, and their respective successors.
(B) The rights and/or obligations of the Borrower under this Agreement
shall be incapable of assignment (either in law or equity) and the Borrower
shall not assign or transfer any of its rights and/or obligations under this
Agreement (either in law or equity).
(C) The Lender may at any time transfer all or any part of its rights,
benefits and obligations hereunder by assigning to any one or more persons
(each of which is hereinafter in this Clause 9 called an "Assignee Person") all
or any part of the Lender's rights and benefits hereunder.
(D) If the Lender transfers all or any part of its rights, benefits
and obligations hereunder as provided in Clause 9(C), all references in this
Agreement to the Lender shall thereafter be construed as references to the
Lender and its Assignee Person(s) to the extent of their respective
participations and the Borrower shall thereafter look only to the Assignee
Person(s) (to the exclusion of the Lender) in respect of that proportion of the
Lender's obligations hereunder as correspond to such Assignee Person's
participation herein (or, as the case may be, in respect of those proportions)
of the Bank's obligations hereunder as correspond to such Assignee Person's
respective participation herein).
10. FURTHER ASSURANCES
The Borrower shall, on being requested by the Lender so to do, at the
Borrower's expense do or cause to be done all such acts and/or execute or cause
to be executed all such documents as may reasonably be considered necessary or
desirable to assure to the Lender the full benefit of this Agreement or the
rights, powers and remedies herein conferred on the Lender.
11. WAIVERS: REMEDIES CUMULATIVE
No failure to exercise and no delay in exercising on the part of the
Lender, any right, power or privilege hereunder and no course of dealing
between the Lender and the Borrower shall operate as a waiver thereof, nor
shall any single or partial exercise of any right, power or privilege preclude
any other or further exercise thereof, or the exercise of any other right,
power or privilege. The rights and remedies herein provided are cumulative and
not exclusive of any rights or remedies provided by law.
12. ENTIRE AGREEMENT
This Agreement contains the entire agreement between the Lender and
the Borrower relating to the Facility and the Loan and the terms and conditions
of this Agreement shall not be varied otherwise than by an agreement in writing
to be executed by or on behalf of the Lender and the Borrower.
13. ILLEGALITY
The illegality, invalidity or enforceability of any provision of this
Agreement under
- 9 -
the law of any jurisdiction shall not affect its legality, validity or
enforceability in any other jurisdiction or the legality, validity or
enforceability of any other provision.
14. NOTICES
Any notice, demand or communication given under this Agreement shall
be in writing and shall be left at or sent by registered mail to or sent by fax
(with written confirmation) to, in the case of notices or communications served
on the Lender, fax number (0000) 000 0000 and marked for the attention of
Xxxxxx Xxxxxxxx and, in the case of notices, demands or communications served
on the Borrower, fax number (007)(000) 000 0000 and marked for the attention of
Xxxxxxx Golovatov or, in any case, such other address or fax number or for the
attention of such other person as may from time to time be notified in writing
by one party to the other party. Any notice, demand or communication shall be
deemed to be given on receipt thereof (which, in the case of a fax, shall be
deemed to occur at the time of transmission) provided that if receipt of any
notice demand or communication does not occur during normal business hours on a
day which is a Business Day at the place where such notice, demand or
communication is received, such notice, demand or communication shall not be
deemed to have been given until the next following Business Day at such place
of receipt.
15. GOVERNING LAW AND JURISDICTION
This Agreement shall be governed by and construed in accordance with English
law.
The parties irrevocably submit for the benefit of the Lender 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 Lender to proceed in the courts of any other competent
jurisdiction.
AS WITNESS the hands of the duly authorised representatives of the parties
hereto the day and year first above written.
- 10 -
SIGNED by XXXXXXX )
GOLOVATOV duly authorised for )
and on behalf of )
STRONTIAN HOLDINGS LIMITED ) XXXXXXX GOLOVATOV
in the presence of:- )
SIGNED by XXXXXXX XXXXXXX )
duly authorised for and on behalf )
of DEFENCE SYSTEMS LIMITED ) XXXXXXX XXXXXXX
in the presence of:- )
