Exhibit 10.3
UNDERTAKING
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UNDERTAKING made this 11th day of February, 1998 in favor of Danvers
Investment Corp. ("Danvers"), Amexcorp Ltd. ("Amexcorp"), and Atom Corp.
("Atom") (sometimes collectively "Company"), from Saf T Lok Incorporated, a
Florida corporation ("STL").
WHEREAS:
A. The Company has introduced STL to United Safety Action, Inc.
("United") which has entered into a Distribution and Purchase Agreement with
STL, dated February 11, 1998, pursuant to which United has agreed to purchase
and distribute products designed and manufactured by STL throughout the world
("DPA");
B. STL wishes to compensate the Company for procuring the DPA and for all
orders for products which are placed by United with STL pursuant to the DPA.
NOW, THEREFORE, for good and valuable consideration the receipt of which is
hereby acknowledged STL undertakes and agrees as follows:
1. Stock Purchase Warrant. As compensation for introducing STL to United
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and for procuring the DPA, simultaneously with the giving of this Undertaking
STL shall issue to the Company stock purchase warrants for a total of 2,000,000
shares of STL's common stock ("Shares") at an exercise price of $5 per Share and
a term of 5 years ("Warrants"). A copy of the Warrants is annexed hereto as
Exhibit A. The Warrants shall carry demand registration rights and shall be
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issued in the following denominations: 1,000,000 shares to Danvers, 500,000
shares to Amexcorp. and 500,000 shares to Atom.
2. Investment Representations. The Company represents, warrants and
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agrees that:
(a) The Warrants and the Shares underlying the Warrants are not
registered under the Securities Act of 1933 or any state's securities laws and
may not be sold without registration unless pursuant to an exemption from
registration.
(b) The Warrants are being acquired by the Company for their own
accounts and for investment purposes and not with a view to being sold in a
public distribution (unless pursuant to a registration statement); and
(c) The Warrants and the certificates for the underlying Shares shall
contain a legend stating that the Warrants (or Shares) are not registered and
may not be sold without registration or in a transaction exempt from
registration.
3. Notices. Any notice, request or demand required to be made or given
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hereunder must be in writing and shall be given, deemed given, or made one day
after it has been sent by overnight or express mail courier and fax, at the
addresses and the fax numbers set forth below, or at such other address as any
party shall subsequently provide to the other party in writing, as follows:
If to STL:
Saf T Lok Incorporated
00000 XX Xxxxxxx Xxxxxxx
Xxxxxxxx, Xxxxxxx 00000
Att'n: Xxxx Xxxxxxx, President
Fax: 000-000-0000
If to the Company:
Danvers Investment Corp.
Amexcorp. Limited
Atom Corp.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Att'n: Xxxxxx X. Xxxxxxxx, Esq.
Fax: 000-000-0000
4. Term. The Term of this Undertaking shall be the same Term as set
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forth in the DPA, including any successive periods which extend the Term under
the DPA.
5. Arbitration. All disputes that may arise under this Undertaking,
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except for disputes which may necessitate extraordinary equitable or injunctive
relief, that are not adjusted by the partes themselves, shall be submitted to
binding arbitration in New York City, New York, before the American Arbitration
Association under its Commercial Rules then prevailing. All costs or
arbitration, including each party's attorneys fees and the fees of the
arbitrators, shall be paid by the non-prevailing party. Pending resolution of
any dispute, if requested in writing by the Company, STL shall proceed
diligently with the performance of its obligations hereunder, including the
payment of Commissions to the Company.
6. Miscellaneous.
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(a) Relationship of Parties. This Undertaking does not constitute a
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partnership or joint venture between STL and the Company.
(b) Governing Law. This Undertaking and any dispute or claim arising
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under this Undertaking shall be governed by the laws of the State of New York
without regard to principles of conflicts of law.
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(c) Jurisdiction. The parties hereby consent to the personal
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jurisdiction of an arbitrator or court located in New York City, New York and of
the United States District Court for the Southern District of New York. Service
of process may be made by certified mail/return receipt requested or any other
method of service of process authorized by law. Each party agrees that it shall
not assert venue as a defense to any action or proceeding or make any argument
based on principles of forum non conveniens or similar legal principles or
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doctrines.
(d) Assignment. STL may not assign its rights under this Undertaking
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without the express written consent of the Company.
(e) No Waiver. Failure of any party to insist upon the strict
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performance of this Undertaking, or a delay in exercising any remedy provided
under this Undertaking, shall not constitute a waiver of any rights, remedies,
terms, conditions or provisions of this Undertaking.
(f) Survival of Obligations. Obligations which, by their nature,
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would continue beyond termination or expiration of this Undertaking, including
by way of illustration only and not limitation, sections related to warranty and
indemnification, shall survive termination or expiration of this Undertaking by
either party for any reason.
(g) Entire Agreement. This Undertaking constitutes the entire
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agreement and understanding between the parties as to the subject matter of this
Undertaking and supersedes all previous written or oral communications,
representations or agreements. This Undertaking may not be modified except by a
written instrument executed by both parties.
(h) Remedies. Remedies available to either party for breach of this
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Undertaking are cumulative and may be exercised concurrently or separately, and
the exercise of any one remedy shall not be deemed an election of such remedy to
the exclusion of other remedies.
(i) Headings. The paragraph headings used in this Undertaking are for
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convenience of reference only and shall not in any way limit or amplify the
terms and provisions hereof, nor enter into the interpretation of this
Undertaking.
(j) Binding Agreement. The persons executing this Undertaking on
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behalf of the parties have been duly and validly authorized to do so, and this
Undertaking is a valid and binding obligation of the parties. Simultaneously
with the execution of this Undertaking, STL shall deliver to the Company a
resolution of its Board of Directors authorizing STL to enter into this
Undertaking and consummate the transactions contemplated hereunder.
(k) Severability. If any term of this Undertaking shall be unlawful,
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void or unenforceable, such term shall be deemed omitted to the extent
prohibited or invalid,
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but the remainder of this Undertaking shall not be invalidated and shall be
given effect to the extent possible.
This Undertaking has been executed as of the date first above written.
SAF T LOK INCORPORATED
A Florida Corporation
By:
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Xxxx Xxxxxxx, President
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