EXHIBIT 10.17
DATE January 22, 1998
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(1) XXXXX LIMITED
(2) PRESTOLITE ELECTRIC LIMITED
_________________________________
LAO SALE AND TRANSITION AGREEMENT
_________________________________
relating to Acton
THIS AGREEMENT is made on 22/nd/ day of January 1998
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BETWEEN:-
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(1) XXXXX LIMITED ("Xxxxx") trading as Xxxxx Aftermarket Operations ("LAO")
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whose registered office is at Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxx Xxxxxxxx
X00 0XX;
(2) PRESTOLITE ELECTRIC LIMITED whose registered office is at Cleveland
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Road, Leyland, Preston, Lancashire PR5 1XB ("the Company")
RECITALS
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(A) The Company has acquired from Xxxxx, inter alia, the business of the
development design manufacture and assembly of the Products (defined in
Clause 1) which have hitherto been distributed in the Market (defined in
Clause 1) by LAO, a division of Xxxxx.
(B) Xxxxx is in possession of the LAO Stock (defined in clause 1) for
distribution to the Market and has agreed to sell the same together with
the LAO Assets (defined in clause 1) to the Company on the terms and
conditions set out in this Agreement.
(C) The Company intends to take over distribution of the Products to the
Market in place of LAO but is not in a position to do so at the date
hereof without the risk that such distribution would be disrupted and
accordingly the Company has agreed to appoint Xxxxx as its agent for the
sale of the Products during a transitional period, and Xxxxx has agreed
to act as the Company's agent, on the terms set out in this Agreement.
(D) The provisions of Part I of this Agreement apply to the sale and
purchase of the LAO Activity and the LAO Assets, the provisions of Part
II apply to the Transitional Arrangements (defined in clause 1) and the
provisions of clause 1 and Part III apply to the whole of this
Agreement.
NOW IT IS AGREED as follows:
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1
1. DEFINITIONS
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In this Agreement:-
1.1 the following words and expressions shall have the following meanings
except where inconsistent with the subject matter or context:-
"Accounting Policies" means the accounting policies and
principles relating to the LAO Stock
set out in Schedule 1
"Acton Sale and Purchase means an agreement made on the date
Agreement" hereof between the parties hereto and
Xxxxx Industries plc entitled the
"Acton Sale and Purchase Agreement"
"Aftermarket" means the market for (a) spare and
replacement parts for components or
sub-assemblies comprised within the
products of Original Equipment
Manufacturers and (b) automotive
accessories but excludes Original
Equipment Service
"Aftermarket Stock" means that part of the LAO Stock as
consists of Products for the
Aftermarket
"Aftermarket Transfer Date" means 27th November 1998
"Ancillary Agreements" means those agreements details of
which are listed in Schedule 2
"Associated Company" means any person which is either a
holding company (whether direct or
2
indirect) or a subsidiary company of
the relevant party or a subsidiary
company of any such holding company
or is otherwise directly or
indirectly controlled by, or is under
the same control, direct or indirect,
as the relevant party from time to
time and at the time that the
relevant clause in which such
expression appears has application
"Commencement Date" means the date hereof
"Completed Contracts" means any contract, order, call off
or other arrangement for the supply
of goods by Xxxxx (or by any other
Xxxxx Group Company as agent or
trustee for Xxxxx) in relation to the
LAO Activity, whether or not made
pursuant to an Excluded Contract (but
excluding the Excluded Contract
itself)
i) pursuant to which the supply of
the relevant goods was completed
prior to the date hereof and in
respect of which any warranty
guarantee maintenance or similar
obligation liability or commitment (a
"Product Warranty") given by Xxxxx
remains outstanding and has
3
not expired; or
ii) pursuant to which the supply of
the relevant goods has been completed
and under which the customer has
prior to the date hereof made a claim
against Xxxxx under any Product
Warranty relating to such goods
"Contracts" means any or all of the Completed
Contracts, the Customer Contracts and
the Supplier Contracts but excludes
all other contracts and arrangements
relating to the LAO Activity
including:-
i) the Excluded Contracts; and
ii) contracts of employment of any
employees of Xxxxx or of any Xxxxx
Group Company
"control" means in relation to any person the
power of any other person or persons
to secure by law or by corporate
structure that the affairs of the
first person are conducted in
accordance with the wishes of that
other person or persons, and any
cognate word shall be construed
accordingly
4
"Controllers" means persons able to decide or
influence the management or policies
of the relevant company in any
material respect including (without
prejudice to the generality of the
foregoing) any of the following from
time to time: its owners, its
directors, any of its partners or any
majority of its shareholders
"customer" means a buyer whether such buyer is
an end user, retailer, wholesaler,
distributor, dealer or otherwise
including the MOD, persons buying as
Original Equipment Service and the
Xxxxx Network
"the Customer Contracts" means all current contracts, orders,
calls off and other arrangements
entered into or taken by Xxxxx or by
any other Xxxxx Group Company as
agent or trustee for Xxxxx relating
to the sale of Products as part of
the LAO Activity (or where any such
current contracts, orders, calls off
and arrangements relate in part only
to such Products then such part shall
be deemed to be included within the
definition) entered into before the
close of business on the date hereof
and
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which at such close remain (in
whole or in part) to be performed by
Xxxxx or any other Xxxxx Group
Company, including those entered into
with the MOD and with customers in
Original Equipment Service
"Encumbrance" means any interest, equity or claim
of any person (including, without
prejudice to the generality of the
foregoing, any right to acquire,
option or right of pre-emption) or
any mortgage, charge, pledge, lien,
assignment, hypothecation, security
interest (including any created by
law) or any other security agreement
or arrangement
"Excluded Contracts" means:
(a) any distribution, agency,
marketing, sales representation,
franchise or similar agreement
relating to Products sold by LAO
which has been made by Xxxxx, or by
any other Xxxxx Group Company as
agent or trustee for Xxxxx, with
another person including any member
of the Xxxxx
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Network; and
(b) any contract, order, call off or
other arrangement primarily for
the supply of services by or to
Xxxxx (or by or to any other
Xxxxx Group Company as agent or
trustee for Xxxxx) in relation
to the LAO Activity
"Force Majeure" means any event or circumstance of
the following kinds which is beyond
the reasonable control of the party
in question: governmental actions,
war, riots, civil commotion, fire,
flood, tempests or other extreme
weather conditions, epidemics, acts
of terrorism, bombings, explosions,
acts of God, other natural disasters
or any event or circumstance similar
in nature to the foregoing
"Fradley Warehouse" means Xxxxx' warehouse premises at
Fradley, Staffordshire
"the Goodwill" means the goodwill (subject to clause
2.2) of Xxxxx in connection with the
LAO Activity
"holding company" has the meaning given in Section 736
of the Companies Xxx 0000 as
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amended
"Incremental Cost" means in relation to any repair or
replacement product or (as the case
may be) packaging of a product, the
cost of performing such repair or
replacing such product or (as the
case may be) packaging of such
product which shall not for the
avoidance of doubt include an
apportionment of any fixed cost or
overhead for which the Company would
have been liable or incurred had it
not been obliged to carry out such
repair or replacement (less the net
scrap or core value (as appropriate)
of the replaced product or as the
case may be materials actually
recovered by the Company after
allowing for all costs of recovery)
or (as the case may be) packaging of
the product
"Intellectual Property Rights" means any patent, copyright,
registered design, design right,
trade xxxx, topography, know-how or
similar property or right by whatever
name it is called and in whatever
country it is registered or subsists
"LAO Activity" means the operations carried on
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now and prior to the date hereof by LAO
in relation to the distribution to the
Market of (a) the Products which are
now and were prior to the date hereof
manufactured or assembled or sourced at
or from Xxxxx' premises at Acton,
London ("Acton"); and (b) Third Party
Products
"the LAO Assets" means the assets specified in clause
2.1 and the benefits and advantages
acquired by the Company from Xxxxx
under this Agreement
"LAO Stock" means stocks of finished Products and
certain components thereof and repair
parts therefor owned by Xxxxx at the
close of business on the date hereof
and held at or in the course of
transit to the Fradley Warehouse for
sale in connection with the LAO
Activity and/or recorded as an asset
in the books and ledgers of Xxxxx
relating to the LAO Activity (and
includes Third Party Products
supplied subject to reservation of
title or which have been supplied on
a consignment stock or sale or return
basis)
"Xxxxx Employee" means any employee employed at
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the date hereof by Xxxxx or any Xxxxx
Group Company in LAO or employed by
Xxxxx or any Xxxxx Group Company in LAO
at any time after the date hereof and
who is so employed at the MOD and OES
Transfer Date and/or the Aftermarket
Transfer Date
"Xxxxx Group Company" means LucasVarity plc and any company
which is a subsidiary of LucasVarity
plc or over which LucasVarity plc has
control from time to time and at the
time that the relevant clause in
which such expression appears has
application, which where a claim is
to be made under the relevant clause
shall mean when the cause of action
accrued under such clause
"Xxxxx Network" means Xxxxx Group Companies acting as
distributors (whether national or
regional, independent Xxxxx or Xxxxx
Group Company appointed or authorised
national or regional distributors,
and all other persons from time to
time or for the time being appointed
by Xxxxx or by any Xxxxx Group
Company (excluding Freios Xxxxx X.X.
in Brazil) to act as distributors,
distribution outlets, export houses
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or selling agents of the Products in
the Market in any country in the world
"Market" means the Aftermarket, Original
Equipment Service and supplies of
spare and replacement parts to the
MOD but excludes the OE Market
"MOD" means the Ministry of Defence in the
United Kingdom of Great Britain and
Northern Ireland
"MOD and OES Transfer means 27th March 1998
Date"
"the MOD Contracts" means those Customer Contracts in
respect of which the customer is the
MOD
"MOD and OES Stock" means that part of the LAO Stock as
consists of Products for the MOD and
Original Equipment Service
"Net Sale Value" means the gross amount invoiced by
Xxxxx on behalf of the Company to the
Company's customers less (i) any VAT
and (ii) Sales Provisions whether or
not such Sales Provisions are shown
as deductions on the invoices issued
to customers or are credited or
otherwise allowed to customers in
some other way
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"Original Equipment means any manufacturer or assembler
Manufacturer" of transport vehicles, engines or
similar equipment including, but not
limited to, a manufacturer or
assembler of motor cars, vans, buses,
coaches, forklifts, industrial
vehicles, trucks, tractors or marine,
motive power or stationary engines or
a manufacturer of components or
sub-assemblies to be fitted as
original equipment to such vehicles,
engines or similar equipment
"OE Market" means Original Equipment
Manufacturers in their capacity as
buyers of Products for fitting as
original equipment
"Original Equipment means the market for supplies of
Service" spare and replacement parts to any
Original Equipment Manufacturers
other than for fitting as original
equipment or to any dealer of any
Original Equipment Manufacturer in
its capacity as a dealer of such
Original Equipment Manufacturer
"person" means any person, firm, association,
company or body corporate or
unincorporate
"Products" means those products listed in Part
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1 of Schedule 2 to the Acton Sale and
Purchase Agreement and/or Third Party
Products and for the avoidance of any
doubt excludes in-line diesel pumps or
any parts or components therefor
"Product Liability" means liability in respect of death,
personal injury, physical damage to
property (other than to the products
themselves) caused by a defect in any
product manufactured, assembled,
repaired, refurbished, serviced, sold
or supplied (or caused by a failure
to carry out servicing properly)
prior to the Completion Date by Xxxxx
in relation to the LAO Activity
"Product Prices" means the prices for the Products as
set out in LAO's price list to become
effective from February 1998
"Purchaser Group Company" means PEI Holding Incorporated or any
subsidiary or holding company of that
corporation from time to time and at
the time that the relevant clause in
which such expression appears has
application, which where a claim is
to be made under the relevant
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clause shall mean when the cause of
action accrued under such clause
"Records" means all such lists of customers and
suppliers and written material
recording Contracts, in each case in
whatever medium held relating
exclusively to the LAO Activity or
the LAO Stock and also the following
in relation to Products:- all
promotional material, sales
publications, catalogues, price
lists, advertising materials, and
sales matter and the like or to the
extent the same relate partly but not
exclusively to the LAO Activity or
the LAO Stock copies of the same but
in any case excluding any of the same
which Xxxxx or any other Xxxxx Group
Company is required by law to retain
"Regulations" means the Transfer of Undertakings
(Protection of Employment)
Regulations 1981 as amended
"sale" means any form of supply whether by
way of sale, lease, hire or exchange
and any cognate word shall be
construed accordingly
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"Sales Provisions" means insofar as the same shall have
been given or allowed, and then only
to the extent done in a manner and to
a level consistent with past practice
(a) volume or performance related and
other rebates, (b) warranty liability
on Third Party Products not charged
back to the suppliers of the same,
(c) the net cost to Xxxxx of
distributors' cleanse stocks taken
back by Xxxxx with the Company's
prior written consent (d) price
support mechanisms and price
discounting or reducing arrangements
of varying kinds given or allowed by
Xxxxx to customers and (e)
commissions payable to export agents
"the Supplier Contracts" means contracts, orders, calls off
and other arrangements which were
entered into before the date hereof
by LAO with suppliers for the supply
to Xxxxx of Third Party Products
which then remain to be performed in
whole or in part
"Third Party Products" means Products purchased by LAO from
third party suppliers which are for
the purposes of supplementing the
range of Products set out in Part 1
of
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Schedule 2 of the Acton Sale and
Purchase Agreement
"Third Party Rights" means all rights of Xxxxx against
third parties arising out of or in
connection with the supply to LAO of
the LAO Stock or Products or the
conduct of the LAO Activity (other
than any such rights arising from a
liability which is not or will not be
assumed by the Company) prior to the
date hereof including but not limited
to (i) all rights under or in respect
of manufacturer's or supplier's
representations, warranties,
guarantees and other contractual
obligations and assurances (express
or implied), (ii) all rights against
sub-contractors, but excluding any
claim by or right of Xxxxx in respect
of (a) any taxation of whatsoever
nature or (b) insurance
"Trade Xxxx Licence" means a licence having the same date
as this Agreement and made between
(1) Xxxxx Industries plc and (2) the
Company and entitled "Acton Trade
Xxxx Licence"
"Transitional Arrangements" means the provisions of Part II of
this Agreement which apply to the
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Transition Period
"Transition Period" means the period between the date
hereof and the Aftermarket Transfer
Date
"the Warranties" means the warranties of Xxxxx
contained in clause 7 and Schedule 3
1.2 words used in this Agreement which denote the singular shall be deemed
to include the plural and vice versa. References to a particular
gender include all other genders;
1.3 references to clauses and Schedules are to clauses of and Schedules to
this Agreement, and references to paragraphs are to paragraphs in the
Schedule in which such references appear;
1.4 the Schedules form part of this Agreement and will have the same force
and effect as if expressly set out in the body of this Agreement;
1.5 the headings to the clauses of this Agreement and to the paragraphs of
any Schedule will not affect its construction;
1.6 the word "including" or any cognate word shall be construed as though
the words "without limitation" immediately followed such word;
1.7 references in this Agreement to any instrument or agreement shall
include such instrument or agreement as may have been or may hereafter
be varied;
1.8 references in this Agreement to statutes or any statutory provision
shall include any statutory modification, re-enactment or extension
thereof for the time being in force and any orders, regulations,
instruments or other subordinate legislation made thereunder provided
always that this shall not operate to increase the liability of the
parties hereunder; and
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1.9 references to any agreements, assets, contracts, property, rights,
benefits, obligations or liabilities of Xxxxx in relation to the LAO
Activity or LAO Assets, or to products or services sold or supplied by
or to Xxxxx, shall include the same where they have been entered into,
acquired, incurred, sold or supplied by or to another Xxxxx Group
Company as agent for Xxxxx whether or not Xxxxx was a disclosed or
undisclosed principal.
PART I
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PROVISIONS RELATING TO SALE AND PURCHASE OF LAO ASSETS
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2. SALE AND PURCHASE OF THE LAO ASSETS
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2.1 Xxxxx shall sell and the Company shall purchase as at and with effect
from the date hereof free from Encumbrances:-
2.1.1 the benefit of the Contracts (subject to the burden attaching
thereto and subject to the provisions of clause 5.3 excluding
the MOD Contracts);
2.1.2 the Goodwill;
2.1.3 the Records;
2.1.4 the LAO Stock;
2.1.5 the Third Party Rights.
2.2 There shall be expressly excluded and excepted from the sale and
purchase hereunder (and nothing in this Agreement shall operate to
transfer) any assets or right relating to the LAO Activity other than
those assets or rights set out in clause 2.1 provided always that
notwithstanding the provisions of clause 2.1 the following shall be so
excluded and excepted:-
2.2.1 the ownership of or the right to use the names or trade marks
"Xxxxx", "LucasVarity" or "CAV" or the Xxxxx diagonal flash or
the CAV device or any other similar trade xxxx or name or other
distinctive get-up used by any Xxxxx Group Company save as
provided herein or in the Ancillary Agreements;
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2.2.2 any right or legal interest deriving from the relationship
between Xxxxx, or any Xxxxx Group Company, and any member of
the Xxxxx Network save as provided herein or in the Ancillary
Agreements;
2.2.3 all cheques and negotiable instruments issued in favour of any
Xxxxx Group Company prior to the date hereof in relation to the
LAO Activity ;
2.2.4 any insurance claim made by or available to any Xxxxx Group
Company in respect of the LAO Activity in respect of events or
occurrences prior to the date hereof and all unearned premiums
under insurance policies or other rights to refunds thereunder
attributable to any period of time after the date hereof;
2.2.5 any claim made by or available to any Xxxxx Group Company in
respect of an event relating to the LAO Activity occurring
prior to the date hereof other than the Third Party Rights;
2.2.6 any asset, benefit or right sold, transferred or granted under
or pursuant to any of the Ancillary Agreements;
2.2.7 all debtors of the LAO Activity as at the date hereof save to
the extent expressly provided otherwise in this Agreement.
2.3 If any of the LAO Assets sold hereunder by Xxxxx is owned by any other
Xxxxx Group Company or there is any other obligation of Xxxxx
hereunder which is only capable of being satisfied by or with the
assistance of any such other Xxxxx Group Company, Xxxxx shall not be
deemed to be in breach of this Agreement so long as Xxxxx procures, to
the extent necessary, compliance by such other Xxxxx Group Company
with the terms and conditions of this Agreement which Xxxxx hereby
undertakes to do. Such other Xxxxx Group Company and, where
appropriate, its employees, shall have the benefit of any exclusions
of liability contained herein in relation to the LAO Assets and any
indemnity given by the Company herein to Xxxxx in relation to the LAO
Assets or the LAO Activity. If any Xxxxx Group Company other than
Xxxxx is
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or was a party to any of the Contracts or the Completed Contracts the
relevant provisions of clause 5 shall apply to such Contract or
Completed Contract (as the case may be) as if Xxxxx was party thereto
and references in those clauses to Xxxxx, shall, where appropriate, be
construed as references to the relevant Xxxxx Group Company.
Accordingly the relevant Xxxxx Group Company shall be entitled to
benefit from the obligations undertaken and indemnities given by the
Company in relation to that Contract or Completed Contract under those
clauses.
3. THE CONSIDERATION
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3.1 The purchase price for the LAO Assets other than LAO Stock shall be
(Pounds)1 to be paid by the Company on the date hereof. The price for
the LAO Stock shall be the value calculated as follows:-
3.1.1 The quantity of LAO Stock as at the date hereof shall be
determined by Xxxxx:-
(a) taking those quantities shown in, or by reference to the
books and accounts of LAO as being the quantity of LAO
Stock at the date hereof (the "Opening Quantity");
(b) recording, on the perpetual inventory basis currently
applied by Xxxxx, all LAO Stock movements by part numbers
description and cost both inwards and outwards between the
date hereof and the Aftermarket Transfer Date;
(c) carrying out a physical stocktake of (i) the MOD and OES
Stock as at the MOD and OES Transfer Date and (ii) the
Aftermarket Stock as at the Aftermarket Transfer Date, in
each case at the Fradley Warehouse within three days
immediately following each such Transfer Date. Written
inventories of that part of the LAO Stock to be delivered
to the Company on those respective dates shall be produced
by Xxxxx as at each of such respective dates, identifying
the type and quantity of each
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item then held by Xxxxx. It is acknowledged and agreed that
in respect of certain items of the LAO Stock it may be
difficult to distinguish between MOD and OES Stock on the
one hand and Aftermarket Stock on the other hand and
accordingly if any dispute or uncertainty arises in this
connection such items will be allocated in such manner as,
having taken into account any expressed and reasoned
representations of LAO as to any items of the LAO stock in
relation to which there is uncertainty or dispute, the
Company shall determine. Any LAO Stock not allocated as
being MOD and OES Stock as at the MOD and OES Transfer Date
shall thereafter for the purposes of this Agreement be
treated as Aftermarket Stock;
(d) reconciling as soon as practicable after the Aftermarket
Transfer Date the Aftermarket Stock shown by the physical
stocktake carried out as at the Aftermarket Transfer Date
against the Opening Quantity, having regard to stock
movements in the interim including the transfer of MOD and
OES Stock to the Company as at the MOD and OES Transfer
Date.
Any LAO Stock losses or gains shall be for the account of
Xxxxx.
3.1.2 In relation to the operation of clause 3.1.1 Xxxxx shall:-
3.1.2.1 provide the Company with information concerning the
Opening Quantity as soon as reasonably practicable;
3.1.2.2 provide the Company with information regarding LAO
Stock Movements on a regular basis; and
3.1.2.3 give the Company at least 7 days' advance notice of
when each stocktake under clause 3.1.1(c) is to take
place. Each of Xxxxx and the Company shall be entitled
to have several representatives present at each such
stock-take; a party shall
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not be entitled, in the absence of manifest error, to
raise any objection as to the correctness of any data
relating to the quantities and descriptions of the
items the subject of such stocktake if no
representative of that party attends such stocktake.
3.1.3 Xxxxx will allow the Company full access to the Fradley
Warehouse, all relevant employees and all records, information
and other documentation (of all of which the Company shall be
entitled to take copies) to enable the Company to participate in
and verify stocktakes and the quantity including but not limited
to the Opening Quantity of LAO Stock determined in accordance
with the foregoing provisions of this clause 3.
3.1.4 The value of the LAO Stock as at the date hereof shall be
determined in accordance with the Accounting Principles. Such
valuation shall be carried out as soon as practicable and in any
event within 14 days following the determination of the quantity
of LAO Stock by Xxxxx in accordance with the foregoing provisions
of this clause 3.
3.1.5 Promptly following such valuation Xxxxx shall serve on the
Company a draft copy of the stock valuation (the "LAO Stock
Valuation") together with a copy of Xxxxx' working papers
including insofar as the Company does not have them already
copies of Xxxxx' workings and papers relating to the
determination of the Opening Quantity. Unless the Company shall
notify Xxxxx in writing within 21 days after its receipt that it
does not accept and agree the LAO Stock Valuation then the
Company shall be deemed to have accepted and agreed the LAO Stock
Valuation for the purposes of this Agreement. Unless Xxxxx shall
otherwise agree, any such notification on the part of the Company
shall specify in such reasonable detail as the Company is able to
provide the matters in dispute. Any matters not objected to in
any such
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notice served by the Company pursuant to this clause 3.1.5 within
such period of 21 days shall be deemed agreed by the Company.
3.1.6 If Xxxxx and the Company are unable to reach agreement pursuant
to clause 3.1.5 within 14 days of the Company giving to Xxxxx
written notification pursuant to such clause, or within such
later time as Xxxxx and the Company may agree, then the sums not
in dispute shall forthwith be paid by the Company to Xxxxx and
any matters not so resolved shall be submitted to an independent
accounting firm of international reputation (the "Independent
Accountant") agreed to by Xxxxx and the Company or in default of
agreement between them within 7 days to be selected at the
instance of either of them by the President for the time being of
the Institute of Chartered Accountants in England and Wales for
final resolution in accordance solely and exclusively with this
Agreement and the Accounting Principles. Submissions to the
Independent Accountant shall be in the form of written statements
of position by Xxxxx and the Company, and each party shall be
given the opportunity to respond in writing to such written
statements and shall respond to any request for statements or
information from the Independent Accountant. Xxxxx, any other
Xxxxx Group Company and the Company shall allow the Independent
Accountant full access to all relevant accounting and other
records of or in relation to the LAO Stock, the Fradley Warehouse
and all relevant employees as it shall require for the purpose of
giving its determination hereunder. Xxxxx and the Company shall
co-operate to procure that the Independent Accountant is able to
reach its decision as to any matter referred to it as
expeditiously as possible. If the Independent Accountant
determines that the resolution of a disputed item requires an
interpretation of law then the Independent Accountant may request
an independent law firm of national standing in England chosen by
it to render a legal opinion as to such matter. The Independent
Accountant shall act as an expert and not as an arbitrator and
shall be directed by Xxxxx and the Company to make its
23
determination as to the quantity and/or value of the LAO Stock as
soon as possible after the matter in dispute is submitted to it
and such determination shall be final and binding upon the
parties hereto. The cost of such Independent Accountant's review
(including reasonable lawyer's fees incurred by it, if any) shall
be borne by the party or parties as determined by the Independent
Accountant;
3.1.7 Any costs incurred by each of the Company and Xxxxx in relation
to the operation of this clause 3 including, without limitation,
any professional costs and expenses, shall be borne by the party
incurring the same save as contemplated by clause 3.1.6 if that
clause applies.
3.2 The Company shall pay Xxxxx for the value of the LAO Stock agreed or
determined pursuant to the foregoing provisions of this clause 3 as
follows:-
3.2.1 as to (Pounds)480,000 of such value on the MOD and OES Transfer
Date;
3.2.2 as to the balance of such value, to the extent that the same is
not disputed, within 21 days of Xxxxx submitting the LAO Stock
Valuation (such 21st day being the "Balance Payment Date" if
there is no dispute as to such value) provided that if there is a
dispute as to the LAO Stock Valuation the provisions of clause
3.1.6 shall apply and the parties shall account to each other in
respect of the disputed items in accordance with the Independent
Accountant's determination within 7 days of receipt of the same
(in which case the "Balance Payment Date" is the day which falls
7 days from such receipt).
Provided always that if the Transitional Arrangements are terminated for
any reason whatsoever prior to the Aftermarket Transfer Date any
outstanding physical stocktake shall be accelerated and be carried out
as at the date of termination in the same manner and on the same
timescales and otherwise as set out in clause 3.1 mutatis mutandis and
on determination of the value of the LAO Stock pursuant thereto the
Company shall pay to Xxxxx the full
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outstanding balance of such value after deduction of any sum
previously paid in relation thereto.
3.3 The Company shall pay Xxxxx interest on any unpaid balance of the
value of the LAO Stock as of the 21st day after Xxxxx submits the LAO
Stock Valuation to the Company at the rate per annum of 1% over
Barclays Bank plc's base lending rate from time to time such interest
to accrue on a daily basis from the date which falls 14 days after the
submission by Xxxxx to the Company of the LAO Stock Valuation until
the Balance Payment Date and if not paid by the Balance Payment Date
the provisions of clause 3.4 shall apply as from the Balance Payment
Date.
3.4 Each party shall pay to the other interest on any sum not paid on the
due date under any provision in this Agreement at the rate per annum
which is 4% above Barclays Bank plc's base lending rate from time to
time, such interest to accrue from day to day from the due date until
the actual date of payment and to be payable after as well as before
any judgement.
3.5 The following provisions shall apply regarding the payments to be made
under this Agreement:-
3.5.1 all sums due from the Company to Xxxxx under this Agreement
shall be paid in (Pounds) pounds sterling to Xxxxx by way of
telegraphic transfer to the following account:-
Name: Xxxxx Limited
Bank: Barclays Bank Plc
Branch: 000, Xxxx Xxxxxx,
Xxxxxxxxx under Lyme,
Staffordshire
Sort Code: 20-59-23
Account No: 00000000
25
or to such other account as Xxxxx xxx hereafter nominate in
writing to the Company.
3.5.2 all sums due from Xxxxx to the Company under this Agreement
shall be paid in (Pounds) pounds sterling to the Company by
way of telegraphic transfer to the following account:-
Name: Prestolite Electric Limited
Bank: National Westminster Bank Plc
Branch: XX Xxx 0, 00 Xxxxxxxxx, Xxxxxxxxxx,
Xxxxxxxxxxxxxxx XX0 0XX
Sort Code: 60-05-16
Account No: 00000000
or to such other account as the Company may hereafter
nominate in writing to Xxxxx.
3.6 All payments to be made pursuant to this Agreement shall (save where
otherwise specifically stated) be taken to be exclusive of VAT (if
applicable) and any VAT chargeable in respect of the matters giving
rise to such payments shall be added to the amount thereof and paid in
addition thereto on submission of a tax invoice in relation thereto.
4. DELIVERY OF LAO ASSETS
----------------------
Xxxxx shall deliver to the Company:
4.1 on the MOD and OES Transfer Date such part of the Records and the LAO
Stock as relates to the MOD and Original Equipment Service, delivery
of such part of the LAO Stock to be effected ex works Fradley
Warehouse;
4.2 on the Aftermarket Transfer Date the remainder of the Records and the
LAO Stock, delivery of such LAO Stock to be effected ex works Fradley
Warehouse.
26
5. CONSENTS THE SPECIFIED CONTRACTS AND THE CONTRACTS
--------------------------------------------------
5.1 Xxxxx hereby agrees and declares that it will after the date hereof
execute and deliver any other documents and take any other steps as
shall reasonably be required from time to time by the Company, at the
Company's expense, to vest in the Company, or as it may direct, the
benefit of the Contracts.
5.2 The Company will at and from the date hereof at its own expense adopt
perform fulfil observe and be bound by all the terms conditions
obligations and liabilities under or in respect of the Contracts
(except for any obligations or liabilities attributable to a breach
prior to the date hereof on the part of Xxxxx or its employees, agents
or sub-contractors (other than a breach, the liability for which is
expressly assumed by the Company in this Agreement including clause
9)) and shall without prejudice to the right (to the extent that the
Company has such right) of the Company to claim for breach of any of
the Warranties in relation to the Contracts keep Xxxxx indemnified
against all expenses, costs, loss, damage, and liability arising
therefrom. Xxxxx shall with effect from the date hereof assign or
hold to the order of the Company or procure the assignment to the
order of the Company of all the Contracts which are capable of
assignment without the consent of the relevant other contracting party
or parties.
5.3 For the purposes of the following provisions of this clause 5
references to "Contracts" shall exclude the MOD Contracts the benefit
and burden of which it is intended in due course shall pass to the
Company once the Company has obtained the consent of the MOD thereto.
Until such time as such consent has been obtained Xxxxx shall continue
to hold the MOD Contracts in its name and, subject to the provisions
of Part II of this Agreement, shall as a contractual obligation only
as between the parties pass the benefit of sums received under the MOD
Contracts to the Company. Xxxxx shall at the Company's expense take
such reasonable action in relation to the MOD Contracts as the Company
may from time to time reasonably request. Provided always that if
such consent has not been obtained by the MOD and
27
OES Transfer Date the provisions of clause 5.4 shall on such date
apply to the MOD Contracts and any references therein to "the date
hereof" shall in that circumstance read "the MOD and OES Transfer
Date".
5.4 Insofar as the benefit (subject to the burden) of the Contracts cannot
effectively be transferred by Xxxxx or any relevant Xxxxx Group
Company to the Company except by way of an agreement of novation with
or consent to the assignment from the person, firm or company
concerned:
5.4.1 Xxxxx and the Company shall co-operate each at its own cost to
do everything they reasonably can to procure that the Contracts
be novated or assigned as aforesaid as soon as reasonably
practicable;
5.4.2 in every novation or assignment as aforesaid the Company shall
undertake to indemnify Xxxxx or the relevant Xxxxx Group
Company against all expenses, costs, loss, damage and liability
arising by reason of or in connection with the non-performance
or the defective or negligent performance by the Company of the
Contracts;
5.4.3 unless and until all such Contracts shall be novated or
assigned as aforesaid:
5.4.3.1 Xxxxx and any relevant Xxxxx Group Company shall
continue its corporate existence and shall hold the
benefit of every such Contract which requires to be
novated or assigned but which has not been novated or
assigned, in trust for the Company as from the date
hereof and shall account to the Company accordingly
(whether in respect of any sums or other benefits
received by it in respect thereof) and otherwise act
at the reasonable direction of the Company and as its
agent in all matters relating thereto subject to the
Company indemnifying and holding Xxxxx (either for
itself or as trustee of the relevant Xxxxx Group
Company) harmless against, any expenses, costs, loss,
damage, or
27
liability, which it may have brought against it or
suffer or incur as a consequence; and
5.4.3.2 the Company shall at its own cost and expense with
effect from the date hereof carry out perform and
complete every such Contract which has not been
novated or assigned as a subcontractor of Xxxxx and
where sub contracting is not possible the Company
shall perform the contracts in accordance with their
terms and conditions as agent for Xxxxx.
5.5 If Xxxxx has before the date hereof sub-contracted the performance of
any Contracts to any person, the Company shall on the date hereof
assume responsibility for the relevant sub-contract and on behalf of
the relevant customer seek or accept delivery or performance from such
person of the goods or other products or services in respect of which
such contract was made and shall make the same available for
collection by such customer.
5.6 Any fee or charge or financial penalty in either case in the nature of
a fee levied by a third party in respect of a novation or assignment
of any Contract or in connection with the termination of any existing
Contract to permit novation or assignment to take place will be borne
by the Company and Xxxxx in equal proportions and the Company shall
procure the execution of any guarantees required by such third party
as a condition of such novation or assignment.
6. XXXXX EMPLOYEES
---------------
6.1 The parties acknowledge and agree that it is not their intention that
any Xxxxx Employees engaged in relation to the LAO Activity shall
transfer from the employment of Xxxxx to the employment of the Company
under or by virtue of this Agreement and/or the Regulations and
neither Xxxxx or the Company shall without the written consent of the
other contend or assist or encourage any other person to contend that
the contracts of employment of any Xxxxx
28
Employee will have or be deemed to have had effect after the date
hereof, the MOD and OES Transfer Date or the Aftermarket Transfer Date
as if originally made between the Company and such Xxxxx Employee
pursuant to the Regulations.
6.2 Xxxxx covenants with the Company that Xxxxx will indemnify the Company
and hold the Company harmless and shall keep the Company indemnified
against all costs, claims, expenses and liabilities whatsoever
(including but not limited to claims for personal injury) and however
arising from the Regulations operating so as to transfer the
employment of any Xxxxx Employees from the employment of Xxxxx to the
employment of the Company or otherwise pursuant to the Regulations or
which otherwise leads to a liability of the Company after the date
hereof in relation to any Xxxxx Employees or their employment or the
termination by the Company of their employment hereafter and any
costs, claims, expenses and liabilities of any nature arising from
such termination by the Company subject to the provisions of clause
8.3. This indemnity shall not apply to any Xxxxx Employee who without
the prior written consent of Xxxxx and as a result of the Company
having offered employment to such Xxxxx Employee becomes an employee
of or consultant to the Company or any Purchaser Group Company at any
time prior to the expiration of 12 months from the Aftermarket
Transfer Date and if any payment shall have been paid to the Company
by Xxxxx pursuant to this clause 6 prior to such expiration such
payment shall be forthwith repaid by the Company to Xxxxx on the date
on which such Xxxxx Employee so becomes an employee of or consultant
to the Company or any Purchaser Group Company, this being without
prejudice to the provisions of clause 6.4.
6.3 In the event that any Xxxxx Employee brings a claim against Xxxxx or
the Company arising out of or in connection with the purported
transfer of employment of such Xxxxx Employee to the Company by virtue
of this Agreement, Xxxxx and the Company shall at the expense of Xxxxx
give to the other as soon as practicable after any request therefor
all co-operation, assistance and information which may be reasonably
relevant to the claim.
29
6.4 The Company hereby undertakes that it will not, and will procure that
no other Purchaser Group Company will, for a period of 2 years from
the date hereof either on its own or any account or in conjunction
with or on behalf of any person without the prior written consent of
Xxxxx solicit or endeavour to entice away any person who at the date
hereof, or at the MOD and OES Transfer Date or at the Aftermarket
Transfer Date is a director or officer or who holds or will hold a
managerial or senior sales, technical or financial post relating to
the LAO Activity or the operation of this Agreement and whether or not
such person would commit a breach of contract by leaving such service.
7. WARRANTIES
----------
7.1 Xxxxx hereby warrants to the Company with regard to the LAO Activity
and the LAO Assets in the terms of the Warranties set out in Schedule
3.
7.2 Each of the Warranties shall be separate and independent and, save as
expressly provided, shall not be limited by reference to any other
warranty or anything in this Agreement.
7.3 Xxxxx shall be released from the effect of the Warranties to the
extent of the disclosures fairly disclosed in Schedule 4.
7.4 The limitations of liability set out in Schedule 5 will apply in
respect of the Warranties.
7.5 Where any of the Warranties is qualified by words such as "Xxxxx is
not aware" or "Xxxxx believes" or "to the best of Xxxxx' knowledge" or
any similar qualification, awareness or belief or knowledge of Xxxxx
shall be determined by reference only to the awareness or belief or
knowledge of the persons whose names are listed in the left hand
column below and whose position is stated opposite his name in the
right hand column below of whom enquiry has been made by Xxxxx and
subject to the foregoing Xxxxx shall not be liable for breach of
warranty should the fact or circumstance which would otherwise be a
breach of the Warranties be known to any other employee or officer of
any Xxxxx Group Company.
30
Name of Person Position Held
C Long-Leather Programme Director-Business Development
A Lord Divestment Project Manager
J Xxxxxxx Managing Director - XXX
X Xxxxx Finance Director - XXX
X XxXxxx Finance Manager Electrical Products Division - XXX
X Xxxxxxxxxxx Sales and Distribution - XXX
X Xxxx General Manager Electrical Products - XXX
X Xxxxxxx Legal Director - LAO
8. INDEMNITY AND LIABILITIES
-------------------------
8.1 Save as expressly provided in this Agreement or in the Ancillary
Agreements, Xxxxx and the Company agree that the Company shall not
assume, and Xxxxx shall remain responsible for all liabilities arising
out of the conduct of the LAO Activity by Xxxxx or any other Xxxxx
Group Company before the date hereof and in particular but without
limiting the generality of the foregoing the Company shall not be
liable for:
8.1.1 any liability of Xxxxx or any other Xxxxx Group Company in
relation to the LAO Activity for borrowed money or other
indebtedness in the nature of borrowings and whether as
principal obligor or in any other capacity;
8.1.2 any liability of Xxxxx or any other Xxxxx Group Company to
taxation of any kind whatsoever arising from its conduct of the
LAO Activity or ownership of the LAO Assets prior to the date
hereof;
8.1.3 any liability expressed elsewhere in this Agreement or the
Ancillary Agreements to be that of Xxxxx or any other Xxxxx
Group Company;
8.1.4 any criminal liability of Xxxxx arising out of a breach of
statutory duty or laws applicable to the LAO Activity or any of
the LAO Assets by Xxxxx;
31
8.1.5 any liability arising from any litigation (meaning proceedings
having been issued and served on Xxxxx) against Xxxxx in
relation to the LAO Activity or the LAO Assets subsisting on
the Completion Date;
8.1.6 any liability to creditors of the LAO Activity as at the date
hereof save to the extent expressly provided otherwise in this
Agreement; and
8.1.7 any liability for breach of the Contracts by Xxxxx or any Xxxxx
Group Company prior to the date hereof other than where such
liability relates to product warranty, product liability or
other claims relating to the quality of products;
and Xxxxx hereby indemnifies the Company and holds the Company
harmless from and against all liabilities, losses, damages, costs and
expenses, interest, awards, judgements and penalties (including
without limitation attorneys and consultants fees and expenses)
suffered or incurred by the Company arising out of or resulting from
any liability referred to in clause 8.1.
8.2 The Company hereby undertakes to indemnify and hold harmless Xxxxx
from and against any and all expenses, costs, loss, damage and
liability suffered or incurred by Xxxxx after the date hereof arising
out of or in connection with any matter the liability for which is
expressly assumed by the Company under the provisions of this
Agreement.
8.3 Before Xxxxx or (as the case may be) the Company ("the Indemnified
Party") makes any payment or offers any other remedy to a third party
in respect of matters for which the Indemnified Party is entitled to
an indemnity from the other of them ("the Indemnifier") under the
terms of any indemnity contained in this Agreement the Indemnified
Party shall give a reasonable opportunity to the Indemnifier, to
verify and, if appropriate, at the Indemnifier's sole cost, remedy the
default, defect, omission or other matter giving rise to the claim in
question subject always to such third party allowing the same.
32
9. PRODUCT LIABILITY AND PRODUCT WARRANTY AND OTHER SPECIFIC ISSUES
----------------------------------------------------------------
9.1 Except for claims falling within clause 9.4 and except in relation to
Third Party Products (but without prejudice to the Company's liability
to contribute to Sales Provisions pursuant to clause 19.3.1) and
without prejudice to the generality of any other provision of this
Agreement, the Company shall be liable:
9.1.1 to meet any claims for breach of a condition or warranty under
terms implied by the Sale of Goods Xxx 0000 (as amended) or the
Supply of Goods and Services Xxx 0000 (as amended) or the
Supply of Goods (Implied Terms) Xxx 0000 (as amended) and to
carry out in accordance with its terms any warranty, guarantee
or other similar obligation or commitment ("Warranty Work"
which expression includes any materials supplied as well as
labour involved) given or undertaken by Xxxxx or any Xxxxx
Group Company before the date hereof in respect of any goods
sold, or in respect of any services performed, under any of the
Completed Contracts; and
9.1.2 for all Product Liability save only in relation to Third Party
Products whether or not the claim in respect thereof is made
against any Xxxxx Group Company or the Company provided both a
written assertion that a claim may be made and such claim is
first made after the date hereof.
9.2 The Company shall indemnify Xxxxx and each Xxxxx Group Company against
all costs, expenses, loss, damage or liability arising in respect of
matters for which the Company is liable under the provisions of clause
9.1.
9.3 In this Agreement:
9.3.1 "Warranty Liability Claim" means a claim (other than a claim in
respect of Product Liability) asserting in relation to a
product manufactured, assembled, repaired, refurbished,
serviced, sold or supplied prior to the date hereof by Xxxxx or
any other Xxxxx Group Company in relation to the LAO Activity,
that it is or was or will
33
become faulty or defective or does not or did not or will not
comply with any warranty or representation expressly or
impliedly made, or with any applicable regulations, standards
or requirements in respect thereof, and in respect of which the
following conditions are also satisfied namely:
9.3.1.1 the claim is made within the contractual warranty
period applicable to the supply (or repair, service or
refurbishment) of the product in question and prior to
31st March 1999, and the Company bona-fide and
reasonably believes it to be a claim which the Company
(by reason of clause 9.1.1) is legally liable to meet;
or
9.3.1.2 the claim is made either before or after the expiry of
the contractual warranty period applicable to the
supply (or repair, service or refurbishment) of the
product in question and prior to 31st March 1999 and
the Company (having consulted with Xxxxx) bona-fide
and reasonably believes applying the same or
substantially the same investigatory routines and
judgmental criteria as were applied by Xxxxx in
relation to the LAO Activity during the period of one
year before the date hereof:
(a) that it is a claim which, because of the size of
the particular order, the importance of the
customer to the LAO Activity, or otherwise, it is
necessary for the Company to meet in whole or in
part in order to preserve the goodwill of the LAO
Activity; and
(b) that in the case where the particular customer or
a similar customer had previously made a similar
claim of comparable size against any Xxxxx Group
Company, that Xxxxx Group Company would have dealt
with the claim in substantially the same way.
34
9.3.2 "Notifiable Claim" means:
(i) a series of Warranty Liability Claims (whether made before
or after or partly before and partly after the date
hereof) resulting from substantially the same fault
(whether of design, manufacturing technique or process,
workmanship or materials) in relation to one or more
products (so that all such products are affected by
substantially the same fault) ("the affected products");
or
(ii) the existence of a state of affairs (whether before or
after the date hereof) which is likely to lead to a series
of Warranty Liability Claims within (i) above, whether or
not a Warranty Liability Claim or Claims are actually
made;
where, in either case, in relation to the affected products,
the Warranty Cost in respect of the Warranty Liability Claims
met and to be met becomes and/or exceeds (Pounds)20,000;
9.3.3 "Warranty Cost" means:
(i) in the case of the affected products which are repaired
the Incremental Cost of performing the repairs;
(ii) in the case of affected products which are replaced the
Incremental Cost to the LAO Activity of the replacement
products and the installation thereof; and
(iii) all other customer costs which the Company, manufacturer
or supplier (as the case may be) is contractually obliged
to meet under the warranty in question.
9.4 In the event that after the date hereof but prior to 31st March 1999
the Company shall be notified in writing by a customer of a new
Warranty Liability Claim which when aggregated with all Warranty
Liability Claims previously made in respect of the affected products
(to the intent and effect
35
that the product in respect of which the new Warranty Liability Claim
is made and the products in respect of which all other Warranty
Liability Claims are or have been made all suffer from substantially
the same fault) is also a Notifiable Claim, the Company shall promptly
notify Xxxxx in writing of the relevant circumstances insofar as these
are known to the Company and, prior to accepting any such new Warranty
Liability Claim, allow Xxxxx to investigate the facts surrounding the
Warranty Liability Claims met and to be met by the Company, the cause
thereof, the Warranty Cost incurred or likely to be incurred in
relation thereto and to make representations to the Company thereon,
all of which Xxxxx will do promptly. The Company shall take into
account such representations in making its decision whether or not to
accept such Warranty Liability Claim, which decision shall be
reasonable.
9.5 The Company shall notify Xxxxx on receipt of any Warranty Liability
Claim(s) which it reasonably believes may become Notifiable Claims.
In respect of such Claims so notified, the Company shall before
accepting the Warranty Liability Claim allow Xxxxx to investigate the
Warranty Liability Claim in question the cause thereof the likely
Warranty Cost in relation thereto and to make representations to the
Company thereon. The Company shall take into account such
representations in making its decision whether or not to accept such
Warranty Liability Claim, which decision shall be reasonable.
9.6 Xxxxx shall from time to time, subject to the Company having provided
Xxxxx with a fully detailed breakdown of its warranty cost and
allowing Xxxxx to verify the same by all reasonable means, pay
promptly to the Company an amount equal to the Warranty Cost incurred
by the Company of meeting Notifiable Claims, each such payment to be
made within twenty one days.
9.7 For the purpose of the application of this clause any Warranty Cost
shall be calculated in pounds sterling.
36
10. ACCRUALS, PREPAYMENTS AND APPORTIONMENTS
----------------------------------------
10.1 Prepayments and volume rebates (allowed or allowable to customers or
received or receivable from suppliers) which are payable
retrospectively which relate to a period both up to and after the date
hereof in either case in respect of any Contract will be apportioned
in accordance with clause 10.2 and will belong to or be due from the
parties accordingly and will be paid in accordance with clause 10.3.
10.2 Any amount to be apportioned pursuant to clause 10.1 will, save in
relation to any retrospective rebate or similar scheme based on
purchases made, be apportioned as at the date hereof rateably on a
time basis over the period to which it relates and in relation to any
such retrospective rebate or similar scheme will be apportioned in the
proportion that the net invoice value of purchases made over that part
of the relevant rebate period falling prior to the date hereof bears
to the net invoice value of purchases made over that part of the
relevant rebate period falling after the date hereof. Any such
amounts (or apportioned parts) as are attributable to any period up to
the date hereof will be due to or from (as the case may be) Xxxxx and
those attributable to periods after the date hereof will be due to or
from (as the case may be) the Company.
10.3 The amount due from Xxxxx to the Company or vice versa in respect of
such apportionments shall be calculated within 14 days after the end
of the last of the periods to expire in respect of which a
retrospective rebate or similar scheme is to be paid either by Xxxxx
to a customer or by a Supplier to Xxxxx and the sum due from Xxxxx to
the Company or vice versa shall be paid within 14 days of the
calculation being produced.
11. RISK PROPERTY AND TITLE
-----------------------
The risk in the LAO Stock shall pass to the Company on delivery of the same
pursuant to clause 4 and accordingly Xxxxx shall continue to insure the
same in the same manner as prior to the date hereof at its own cost until
such risk passes to the
37
Company. The property in and title to the LAO Stock shall pass to the
Company on the date hereof.
12. PROVISIONS RELATING TO XXXXX NETWORK
------------------------------------
12.1 Within three 3 days from the date hereof Xxxxx will send a notice to
all Xxxxx' wholesale distribution outlets in the UK and all of the
national distributors or other importers in each country outside the
UK comprised within the Xxxxx Network in the terms set out in Schedule
6 ("the Circular") relating to the completion of the transactions,
ongoing relationship between Purchaser Group Companies and Xxxxx Group
Companies and the ability of the Xxxxx Network to do business with
Prestolite Group Companies in relation to products which are not
direct replacements for Xxxxx products.
Each of such national distributors or other importers in each country
outside the UK shall be mandated and instructed by Xxxxx to inform all
authorised Xxxxx dealers and sub-distributors in each of the networks
in their respective countries to the same effect as set out in the
Circular.
12.2 Xxxxx will on or about each of the MOD and OES Transfer Date and the
Aftermarket Transfer Date send out to the relevant part of the Xxxxx
Network affected by the transfers to be made on such respective dates
an appropriate notice about such transfers in terms to be agreed with
the Company not to be unreasonably withheld repeating in substance
certain of the points set out in the Circular including the ability of
the Xxxxx Network to do business with Prestolite Group Companies in
relation to products which are not direct replacements for Xxxxx
products.
12.3 The Company shall, subject to obtaining Xxxxx' prior approval in
writing to the terms thereof such approval not to be unreasonably
withheld or delayed, be entitled occasionally to send a circular to
the Xxxxx Network in such terms as shall have the approval of the
project team referred to in clause 20.
13. EXCLUSIONS
----------
38
Save as otherwise expressly provided in this Agreement Xxxxx shall not be
liable by reason of the sale of the LAO Assets under this Agreement for any
personal injury, death, loss or damage of any kind whatsoever (other than
death or personal injury resulting from its negligence) whether
consequential or otherwise (including but not limited to loss of profits)
arising from any defect in the LAO Assets and save as provided in clauses 2
and 7 Xxxxx hereby excludes in relation to the LAO Assets and the LAO
Activity all conditions, warranties, representations, guarantees and
stipulations express or implied, statutory, customary or otherwise which
but for such exclusion would or might subsist in favour of the Company
except that such exclusion will not apply to any statements made
fraudulently nor to any condition or warranty implied by law which cannot
lawfully be excluded.
14. INSPECTION OF DOCUMENTS
-----------------------
Xxxxx shall for a period of 12 months after the Aftermarket Transfer Date
afford to the authorised representatives of the Company all reasonable
facilities to inspect records held or retained by Xxxxx or its professional
advisers (which are not privileged) relating exclusively to the LAO
Activity and/or the LAO Assets (which records Xxxxx agrees to maintain for
such period) and to make copies or extracts therefrom. If within such
period Xxxxx shall desire to cease holding and maintaining any such records
it shall before taking any action in relation thereto give the Company a
reasonable opportunity to inspect the same and at the Company's request and
cost and take delivery of the same. The Company agrees to maintain at the
registered office of the Company, and allow Xxxxx at all reasonable times
access to and to take copies of, the Records insofar as they relate to the
period prior to the Aftermarket Transfer Date, wherever held, for a period
of 12 months from the Aftermarket Transfer Date.
PART II
-------
PROVISIONS RELATING TO TRANSITIONAL ARRANGEMENTS
------------------------------------------------
15. APPOINTMENT
-----------
15.1 With effect on and from the Commencement Date the Company hereby
irrevocably appoints Xxxxx as its exclusive agent for the sale of the
Products
39
to the MOD, Original Equipment Service and the Aftermarket and Xxxxx
agrees to act as the Company's agent upon and subject to the terms and
conditions of the Transitional Arrangements.
15.2 Except with the prior written consent of Xxxxx, the Company shall
not:
15.2.1 until after the MOD and OES Transfer Date sell Products to the
MOD or Original Equipment Service directly or indirectly
otherwise than through Xxxxx;
15.2.2 until after the Aftermarket Transfer Date sell Products to the
Aftermarket directly or indirectly otherwise than through
Xxxxx;
and even where such consent is given the provisions of clause 19.3
shall apply to such direct or indirect sales.
16. SUPPLY OF PRODUCTS
------------------
16.1 The authorities and rights given to Xxxxx and the obligations on the
Company in this clause 16 shall apply from the date hereof (a) in
relation to the MOD and Original Equipment Service only in respect of
orders given or taken by Xxxxx for Products prior to the MOD and OES
Transfer Date and (b) in relation to the Aftermarket in respect of
orders given or taken by Xxxxx prior to the Aftermarket Transfer Date.
16.2 All orders taken from customers in the Market by Xxxxx for Products
may be taken by Xxxxx as agent of the Company as a disclosed or
undisclosed principal at Xxxxx' absolute discretion.
16.3 In order to supply Products to customers Xxxxx shall take the same
from stock held at the Fradley Warehouse and shall replenish such
stock by ordering them from the Company and third party suppliers in
the same way as LAO prior to the Commencement Date ordered Products
from the business carried on at and from Acton and from third party
suppliers save that Xxxxx shall obtain and the Company shall supply
Products, other than Third Party Products, on a free
40
issue basis and Xxxxx shall obtain Third Party Products from third
party suppliers as agent for the Company.
16.4 So as to protect Xxxxx' good name in the Market and generally enable
LAO to continue (but as agent for the Company) to service the Market
in the same way as prior to the date hereof:
16.4.1 the Company shall manufacture and shall supply Xxxxx with such
quantities of Products as Xxxxx requires in order to meet
orders for the Products received from customers within the
timescales but subject to applicable minimum order quantities,
lead times and product scheduling arrangements generally
achieved by the LAO Activity prior to the date hereof. The
Company shall deliver Products to LAO at the Fradley Warehouse
free of charge in accordance with delivery schedules agreed
with Xxxxx;
16.4.2 the Company shall conform to the planning and supply
arrangements that were in place between LAO and the business
carried on at and from Acton immediately prior to the
Commencement Date. The Company agrees to use its best
endeavours to produce the same quality of Product which was
supplied to LAO immediately before the Commencement Date and in
sufficient quantities to meet the demand for Products for
delivery in the Market.
16.5 Xxxxx is authorised on behalf of the Company (either as disclosed or
undisclosed principal) to enter into contracts with suppliers for
Third Party Products in the manner and on a scale hitherto applying to
the LAO Activity without reference back to the Company provided that
LAO shall consult with the Company prior to dealing with any new or
alternative supplier of Third Party Products or agreeing to change any
terms and conditions applying to the supply of Third Party Products
which are material and to the detriment of the Company. Where Third
Party Products are purchased by Xxxxx Xxxxx shall invoice the Company
at the same price as that paid by Xxxxx to the supplier.
41
16.6 Xxxxx is authorised on behalf of the Company (either as disclosed or
undisclosed principal) to enter into contracts with customers for the
sale of the Products at the Product Prices without reference back to
the Company. The Company will honour any contracts for the sale of
the Products entered into by Xxxxx on behalf of the Company in
accordance with its authority to do so herein contained.
16.7 Xxxxx will use reasonable endeavours to ensure that all sales of the
Products by Xxxxx to customers shall be made on Xxxxx' terms and
conditions of sale for the time being.
17. XXXXX' DUTIES AND OBLIGATIONS
-----------------------------
17.1 Xxxxx agrees with the Company that throughout the Transition Period
but subject to the other provisions of the Transitional Arrangements:
17.1.1 in performing its activities under the Transitional
Arrangements Xxxxx will look after the interests of the Company
and act dutifully and in good faith;
17.1.2 not to make any hidden profit other than by means of the
operation of this Agreement as envisaged by its terms.
17.1.3 to be solely liable for any representations or warranties given
to customers other than those contained in Xxxxx' terms and
conditions of sale for the time being or as otherwise expressly
authorised in writing by the Company from time to time;
17.1.4 at all times diligently to promote and procure sales of the
Products by such means consistent with past practice as LAO
shall have done prior to the date hereof when carrying on the
LAO Activity for its own account;
17.1.5 to have regard to the Company's reasonable and lawful requests
in relation to the conduct of the LAO Activity but so that
nothing contained in this clause 17 or in the Transitional
Arrangements shall
42
require LAO to make any change from the way the LAO Activity
was conducted by it prior to the date hereof or incur any
expense in so doing, it being the intention that save in
relation to unusual circumstances Xxxxx shall carry out its
duties with the minimum of interference from the Company;
17.1.6 to conduct the LAO Activity in an orderly and businesslike
manner;
17.1.7 to comply in the conduct of the LAO Activity with all
applicable laws, byelaws and requirements of any governmental
or regulatory authority applicable to the LAO Activity;
17.1.8 to supply to the Company (i) weekly the amount of invoiced
sales and orders received in relation to the LAO Activity for
the immediately preceding week (ii) information reasonably
requested by the Company to complete its monthly management
accounts by the third day of each month; and (iii) from time to
time upon reasonable request, sales reports, returns and other
information relating to the LAO Activity in such detail as the
Company may reasonably request provided that any information to
be provided by Xxxxx pursuant to this clause shall be
consistent with the type and extent of information historically
provided prior to the date hereof by LAO to Acton;
17.1.9 not without prior consultation with and consent from the
Company to offer in relation to the sale of any products any
exceptional special discounts, rebates, price reductions, or
other incentive schemes or arrangements which would result in
abnormal sales provisions being required to be made as a
consequence, unless pursuant to contractual arrangements
already in force prior to the date hereof or unless in the
ordinary course of business having regard to the historical
operation of the LAO Activity.
17.2 Save as and if specifically provided elsewhere in this Agreement or
otherwise expressly authorised by the Company, Xxxxx shall not without
the Company's
43
prior express approval incur any liabilities on behalf of the Company
nor pledge the credit of the Company. Xxxxx has no authority to and
shall not take institute or defend any proceedings on behalf of the
Company (but Xxxxx xxx do so on its own behalf where it has been made
a party to any proceedings) or settle or attempt to settle or make any
admission concerning any such proceedings against the Company relating
to the Products or any contract concerning the Products or relating to
the affairs of the Company generally. Xxxxx will immediately inform
the Company of any proceedings in which it becomes involved as a party
relating to the LAO Activity. For the avoidance of doubt, Xxxxx shall
be entitled to take any proceedings or other action to recover any
debt due from a customer in circumstances where the debt is bad or
Xxxxx has good reason to believe that such debt might become bad.
17.3 Xxxxx shall permit the Company from time to time during the Transition
Period to inspect during normal working hours on reasonable prior
notice (a) the Fradley Warehouse where Products are being stored and
(b) the relevant documentation relating to the sale by Xxxxx of
Products on behalf of the Company or the purchase of Products on
behalf of the Company, to verify that Xxxxx has been and is complying
with its duties and obligations under this Agreement.
18. OBLIGATIONS ON COMPANY
----------------------
18.1 The Company will be responsible for dealing with all warranty claims
made by customers in respect of Products supplied by Xxxxx during the
Transition Period on a basis consistent with that applicable as
between the LAO Activity and Acton prior to the date hereof and shall
reimburse Xxxxx, against Xxxxx' invoices, for any costs, expenses or
liabilities properly incurred or suffered by Xxxxx in respect of any
such warranty claims provided that Xxxxx shall not be entitled to
claim any such costs, expenses or liabilities if and to the extent
that they were voluntarily incurred or suffered by Xxxxx and the
customer was not contractually entitled to any relief or remedy under
the relevant warranty. The Company acknowledges that Xxxxx will not,
and shall not be required to, carry
44
out inspection of Products before delivery of the same to the
Company's customers.
18.2 Without prejudice and in addition to any of Xxxxx' rights under
applicable law the Company shall indemnify and hold Xxxxx harmless
against all actions, claims, costs, demands, expenses and liability of
whatsoever nature suffered or incurred by Xxxxx as a result of (a) any
act carried out by Xxxxx as authorised or permitted under the terms of
the Transitional Arrangements, (b) any omission on the part of Xxxxx
by virtue of any restriction placed on Xxxxx under the terms of the
Transitional Arrangements, (c) any claim made against Xxxxx in respect
of any Products supplied after the date hereof under the Transitional
Arrangements which were or become defective (d) any claim made against
or suffered by Xxxxx in respect of any infringement of the
Intellectual Property Rights of any person resulting from the sale by
Xxxxx of any Products under the Transitional Arrangements provided
that such indemnity under this sub-clause (d) shall not apply to any
such actions, claims, costs, demands, expenses and liabilities to the
extent that they arise from the application and/or use of the Trade
Marks on Products in accordance with the Trade Xxxx Licence. The
indemnity in this clause 18.2 shall not apply to the extent Xxxxx
shall have acted outside the scope of its authority under this
Agreement.
18.3 The Company shall, at the reasonable request of Xxxxx, provide Xxxxx
without charge, with all technical information and promotional
material regarding the Products as Xxxxx xxx reasonably require in
carrying out its services under this Agreement.
18.4 The Company shall bear and reimburse Xxxxx (against Xxxxx' invoices to
be submitted on a monthly basis) for 50% of the Incremental Cost
incurred by LAO in carrying out at the Fradley Warehouse the packaging
of those Products which have prior to the date hereof been packaged by
LAO.
45
19. PRICE, PAYMENT AND COMMISSION
-----------------------------
19.1 The Product Prices are in pounds sterling and are exclusive of VAT or
other similar sales taxes or other duties which, if applicable, shall
be an addition to such prices.
19.2 Xxxxx shall issue VAT invoices to customers for Products sold to
customers by Xxxxx on behalf of the Company and shall hold payments
received from customers (excluding the VAT element thereof where Xxxxx
has issued invoices where the Company is undisclosed principal) on
trust for the Company subject to the provisions of clauses 19.3, 19.4
and 19.5. Xxxxx shall have sole responsibility for collecting payment
from customers and shall be liable to pay the Company the amount of
any bad debts which arise. Whether a debt is bad shall be determined
by reference to the criteria historically and consistently applied by
Xxxxx in relation to bad debts. The Company shall if requested by
Xxxxx give reasonable assistance in the collection of debts at Xxxxx'
expense.
19.3 In consideration of the services to be provided by Xxxxx pursuant to
the Transitional Arrangements Xxxxx shall be paid a fee of
(Pounds)400,000 plus VAT to be paid by the Company as to
(Pounds)160,000 plus VAT on the MOD and OES Transfer Date and as to
(Pounds)240,000 plus VAT on the Aftermarket Transfer Date in each case
against delivery on such dates by Xxxxx to the Company of VAT invoices
dated as to tax point as of such dates, and in addition shall be paid
a commission equal to 30% plus VAT of the Net Sale Value of Products
invoiced by Xxxxx on behalf of the Company or by the Company direct to
customers in the Market (this being without prejudice to clause 15.2)
provided always that:
19.3.1 the cost (excluding (where relevant) any charges or recoveries
for overheads or other overhead allocations) of Sales
Provisions shall be borne as to 70% by the Company and as to
30% by Xxxxx and the Company shall reimburse Xxxxx for its 70%
contribution to such cost against LAO's invoices in relation
thereto. An invoice will each
46
month be submitted by Xxxxx to the Company on the basis of a
notional Sales Provision of 1.7% of the Net Sale Value of
Products invoiced by Xxxxx in the immediately preceding month.
On or about each of the MOD and OES Transfer Date, 30th June
1998 and 31st March 1999 the notional Sales Provisions invoiced
to the Company respectively in the periods to the MOD and OES
Transfer Date, the 30th June 1998 and the Aftermarket Transfer
Date will be reconciled against the actual Sales Provisions
over the same respective periods and an invoice or a credit
note (as the case may be) will be issued by Xxxxx to the
Company in relation to the reconciled liability of the Company
over the relevant period provided always that the maximum
liability of the Company under this clause 19.3.1 shall be 70%
of 1.7% of the Net Sale Value of Products invoiced by Xxxxx
during the Transition Period;
19.3.2 the commission payable to Xxxxx shall in respect of the MOD and
Original Equipment Service only be payable in respect of
Products invoiced or in transit to the MOD or Original
Equipment Service before the MOD and OES Transfer Date and in
respect of the Aftermarket only be payable in respect of
Products invoiced or in transit on or before the Aftermarket
Transfer Date.
19.4 Xxxxx shall on the 10th of each month after the date hereof (including
on the 10th of each month after the end of the Transitional Period
until all statements of account between Xxxxx and the Company pursuant
to the Transitional Arrangements have been settled) send to the
Company a statement showing the following:
19.4.1 the aggregate Net Sale Value of Products invoiced by Xxxxx on
behalf of the Company during the immediately preceding month
(the "previous month");
19.4.2 the net receipts (excluding VAT) of cash received from
customers in respect of Products in the previous month;
47
19.4.3 the amount of Sales Provisions payable by the Company pursuant
to clause 19.3.1 in respect of the previous month;
19.4.4 the amounts paid by Xxxxx to third party suppliers for Third
Party Products in the previous month;
19.4.5 the amount of commission due to Xxxxx in respect of sales of
Products invoiced in the previous month;
19.4.6 the amount due from the Company in respect of any warranty
claims settled in the previous month for which the Company is
liable under this Agreement;
19.4.7 the amount due from the Company in respect of its 50% share of
the cost to LAO of carrying out packaging of Products in
accordance with clause 18.4 in the previous month;
19.4.8 any other sum which has become due and is outstanding from one
party to the other in the previous month under the Transitional
Arrangements.
Such statement shall identify the sum due to the Company from Xxxxx or
vice versa in respect of the previous month and where the Company is
due to be paid Xxxxx shall account to the Company for all sums due to
it less any amounts due from the Company to Xxxxx by effecting payment
to the Company and Xxxxx shall issue an invoice or invoices in respect
of the sum or sums due to Xxxxx and where Xxxxx is due to be paid the
Company shall pay such invoice or invoices issued by Xxxxx within 7
days of receipt. All payments due from one party to the other under
this clause 19.4 shall be paid without any deduction or withholding
whether by way of set off, counterclaim or otherwise save to the
extent specifically provided above and save to the extent that any sum
is required to be withheld by law.
19.5 In consideration of Xxxxx inputting data in respect of Products and
customers in the Aftermarket into its proposed new computer system for
the whole of
48
LAO's business the Company shall pay to Xxxxx an additional charge of
(Pounds)25,000 (plus VAT) which shall be paid on whichever is the
later of 27th March 1998 or the date on which such data has been fully
input into such new computer system. Xxxxx shall issue the Company
with a VAT invoice in respect of such charge.
19.6 Xxxxx shall be entitled to suspend its services under Part II of this
Agreement as the Company's agent for the sale of Products to the
Market by giving written notice to the Company if Xxxxx has not
received any payment due to it under the Transitional Arrangements
within 10 days of written demand for payment being made to the Company
after the due date for payment and such suspension may continue until
such time as such outstanding payments have been made.
19.7 Notwithstanding any other provision of this Agreement Xxxxx shall not
be required to act as the Company's agent for the sale of the Products
to the MOD and Original Equipment Service after the MOD and OES
Transfer Date nor to the Aftermarket after the Aftermarket Transfer
Date.
20. PROJECT TEAM
------------
On the Commencement Date each party shall nominate two persons who will
make up a project team which will be responsible for procuring the timely
and effective transfer of the marketing and distribution of the Products to
the Company in accordance with the terms of this Agreement. In particular
such project team will in respect of the MOD and Original Equipment Service
a reasonable time before the MOD and OES Transfer Date and in respect of
the Aftermarket a reasonable time before the Aftermarket Transfer Date:
20.1 determine the precise time scales and steps required to be taken to
achieve the transfer of Product marketing and distribution to the
Company;
20.2 report to the Company and Xxxxx with firm proposals for the
implementation and timing of Product marketing and distribution to the
Company;
49
20.3 agree the content of and timing of any announcements agreed to be made
to the Xxxxx Network additional to the circular to be sent out
pursuant to clause 12;
20.4 resolve any problems or issues which relate to the transfer of Product
marketing and distribution to the Company.
21. TRADE XXXX PROVISIONS
---------------------
On the date of this Agreement Xxxxx will enter into the Trade Xxxx Licence
with the Company for the Company's use of the Trade Marks (as defined in
the Trade Xxxx Licence) on Products and Promotional Material (as defined in
the Trade Xxxx Licence) and the Company shall comply with the provisions of
such Trade Xxxx Licence in relation to the labelling and marking of
Products and such Promotional Material. Xxxxx shall be entitled to suspend
its services under Part II of this Agreement in relation to any Product
and/or the Promotional Material relating to the same which is supplied by
the Company in breach of the terms of the Trade Xxxx Licence by giving
written notice to the Company. Nothing in this Agreement shall give the
Company the right to sell or distribute Marked Products (as defined in the
Trade Xxxx Licence) in any manner which would contravene the provisions of
the Trade Xxxx Licence and if there shall be any conflict between the Trade
Xxxx Licence and this Agreement the Trade Xxxx Licence shall prevail.
22. LIABILITY
---------
In relation to the services to be provided by Xxxxx under Part II of this
Agreement all warranties, representations, conditions or other terms
implied in or by contract, tort, statute, common law or otherwise are
hereby expressly excluded save to the extent that it is unlawful so to do.
Xxxxx shall not under any circumstance be liable in contract, tort, statute
or otherwise for any loss, damage or liability of any nature whatsoever
incurred or suffered by the Company whether direct, indirect, economic,
consequential or otherwise arising out of or in connection with any
services carried out or omitted to be carried out by Xxxxx pursuant to this
Agreement whether negligently or otherwise save only:
50
22.1 any loss or damage arising from any fraudulent act or omission of
Xxxxx;
22.2 any death or personal injury arising from Xxxxx' negligence;
22.3 any physical loss or damage to property arising from the gross
negligence or wilful default of Xxxxx.
23. CONFIDENTIALITY
---------------
Each party undertakes that it shall not, and shall ensure that its
employees and agents shall not, disclose, use or permit the use of any
confidential information disclosed to it by the other party except as may
be necessary for complying with its obligations under this Agreement and
then only in such a manner as to protect fully the confidentiality of such
confidential information. The obligations of non-disclosure by each party
shall continue to apply notwithstanding the termination of this Agreement
but shall not apply to any information which falls into the public domain
other than by breach of such obligation of non-disclosure by such party.
Registration or notification of this Agreement with or to any regulatory
authority shall not be a breach of confidence for the purposes of this
clause.
24. TERM AND TERMINATION
--------------------
24.1 The provisions of Part II of this Agreement shall come into force on
the Commencement Date and subject to earlier termination under clause
24.2, shall, in respect of sales of Products to the MOD and Original
Equipment Service continue in force until the MOD and OES Transfer
Date and in respect of sales to the Aftermarket until the Aftermarket
Transfer Date.
24.2 A party shall be entitled to terminate the Transitional Arrangements
set out in Part II of this Agreement summarily by written notice to
the other party if the other party is:
24.2.1 in material breach of such Transitional Arrangements and shall
have failed to remedy the breach within 30 days after receipt
of a request in writing from the party not in breach to remedy
the breach, such request
51
indicating that failure to remedy the breach may result in
termination of the Transitional Arrangements;
24.2.2 insolvent or has a receiver, manager, administrator,
administrative receiver, liquidator (other than for the
purposes of a solvent reconstruction or amalgamation) appointed
over it or its undertaking assets or income or any part
thereof.
24.3 Xxxxx shall be entitled to terminate the Transitional Arrangements
summarily within 3 months of becoming aware of any change in the
Controllers of:
24.3.1 the Company; or
24.3.2 any direct or indirect holding company of the Company;
resulting in the new Controllers being a Xxxxx competitor named
in Schedule 7. The Company undertakes to notify Xxxxx in
writing of any such change within 7 days of the same occurring.
25. EFFECTS OF TERMINATION
----------------------
25.1 MOD and OES Transfer Date
-------------------------
25.1.1 As from the MOD and OES Transfer Date Xxxxx will cease to hold
itself out as agent for the Company for the purchase and/or
sale of Products for or to the MOD and Original Equipment
Service and shall hand over on such date its order files in
relation to purchases of Third Party Products and sales to the
MOD and customers in Original Equipment Service who will then
be the responsibility of the Company in relation to all matters
concerning the Products to the exclusion of Xxxxx.
25.1.2 On the MOD and OES Transfer Date the Company shall collect from
Xxxxx from its Fradley Warehouse at the Company's own cost and
expense all stock held there which is intended for sale
exclusively to
52
the MOD and Original Equipment Service (and not to the
Aftermarket).
25.2 Aftermarket Transfer Date
-------------------------
25.2.1 As from the Aftermarket Transfer Date Xxxxx will cease to hold
itself out as agent for the Company for the purchase and/or
sale of the Products for or to the Aftermarket or otherwise in
relation to the LAO Activity and shall hand over on such date
its order files in relation to purchases of Third Party
Products and sales to customers in the Aftermarket who will
then be the sole responsibility of the Company in relation to
all matters concerning the Products and the LAO Activity to the
exclusion of Xxxxx and with effect from the Aftermarket
Transfer Date the Company shall take over and operate for its
own account the LAO Activity and all those duties, obligations
and responsibilities which prior thereto had been carried out
by Xxxxx as agent for the Company under the Transitional
Arrangements.
25.2.2 On the Aftermarket Transfer Date the Company shall collect from
Xxxxx from its Fradley Warehouse at the Company's own cost and
expense all stock of the Products held there.
25.3 No Compensation
---------------
Termination howsoever arising or expiry of the Transitional
Arrangements on the Aftermarket Transfer Date shall not entitle LAO to
any compensation or indemnity in respect of such termination or expiry
except in relation to any prior breach by the Company of the
Transitional Arrangements. If under the governing law of this
Agreement or the law of any country in which LAO shall perform any of
its duties and obligations under this Agreement such compensation or
indemnity shall be payable:
25.3.1 if such law permits the parties to contract-out of payment of
or liability for the same this clause shall be deemed to
operate in such way as to
53
have effect as a contracting-out of any such liability
under such law; and
25.3.2 if such law shall prohibit the parties from contracting-out of
payment of or liability for the same and LAO shall make any
claim for such compensation or indemnity then to the extent
that the Company shall be required to pay any such indemnity
or compensation and shall pay it the rate of commission
specified in clause 19.3 shall be deemed to be retrospectively
adjusted to such lower rate as when applied to the aggregate
Net Sale Value during the period of the Transitional
Arrangements shall result in the aggregate commission earned
by LAO being lower than the aggregate commission actually
earned by LAO and paid by the Company by an amount ("the
Corresponding Debt") which is equal to the indemnity or
compensation payable. LAO shall forthwith on payment by the
Company of any indemnity or compensation account to the
Company for the amount of the commission which has been
overpaid by the Company as a result of the operation of this
clause. The Company shall be entitled to set off against and
deduct from any indemnity or compensation payable the
Corresponding Debt.
25.4 General
-------
25.4.1 In the event that the Transitional Arrangements are terminated
under clause 24.2 or 24.3, Xxxxx shall as from the date of
termination cease to hold itself out as agent for the Company
for the purchase or sale of the Products and the Company shall
immediately collect from Xxxxx at its Fradley Warehouse at the
Company's own cost and expense any stock held there which
belongs to the Company.
25.4.2 The termination of the Transitional Arrangements howsoever
arising will be without prejudice to the rights and duties of
either party accrued prior to termination. The clauses in this
Agreement which expressly or impliedly have effect after such
termination will continue
54
to be enforceable notwithstanding termination. Any indemnities
given in this Agreement will continue to apply notwithstanding
termination of the Transitional Arrangements.
26. FORCE MAJEURE
-------------
Neither Xxxxx nor the Company shall be liable to the other for any failure
or delay in performing its obligations in relation to the Transitional
Arrangements under this Agreement due to Force Majeure provided always
that:-
26.1 the date for performance of the contractual obligation which has been
delayed by Force Majeure shall be deemed suspended only for a period
equal to the delay thereby caused;
26.2 the party seeking to exempt itself from liability by virtue of the
provisions of this clause 24 shall give notice to the other party
within 7 (seven) days of becoming aware of the Force Majeure event or
circumstance and of its consequences and shall at all times use all
reasonable endeavours to mitigate the severity of the same.
PART III
--------
GENERAL
-------
27. ASSIGNMENT PROHIBITED
---------------------
The benefit and/or burden of this Agreement shall not be assignable or
assigned by either Xxxxx or the Company without the prior written consent
of the other (which consent shall not be unreasonably withheld in the case
of an internal group reorganisation (without insolvency) intended to be
made by either Xxxxx or the Company provided always that any assignee shall
be a person of similar substance and standing as the assignor or a suitable
guarantee shall be provided) save that Xxxxx or the Company shall be
entitled without the consent of the other to accept the benefits accruing
under this Agreement or to exercise its rights covenants and obligations
hereunder through the agency of (in the case of Xxxxx) any other Xxxxx
Group Company and (in the case of the Company) any other Purchaser Group
55
Company. In cases where the assignee of this Agreement is a Xxxxx Group
Company, then, upon ceasing to be a Xxxxx Group Company, Xxxxx shall
procure that such assignee shall, and such assignee shall be obliged to,
re-assign this Agreement to Xxxxx. In cases where the assignee of this
Agreement is a Purchaser Group Company then, upon ceasing to be a Purchaser
Group Company, the Company shall procure that such assignee shall, and such
assignee shall be obliged to, re-assign this Agreement to the Company.
28. SEVERABILITY
------------
The illegality, invalidity or unenforceability of any clause or part of
this Agreement will not affect the legality, validity or enforceability of
the remainder. If any such clause or part is found by any competent court
or competent authority to be illegal, invalid or unenforceable the parties
agree that they will substitute provisions whose effect is as similar to
the offending provisions as is possible without thereby rendering them
illegal, invalid or unenforceable.
29. ENTIRE AGREEMENT
----------------
29.1 This Agreement, and the documents referred to in it, contain the whole
agreement between the parties relating to the transactions concerning
the LAO Activity, the LAO Assets and the Transitional Arrangements
contemplated by this Agreement and supersede all previous agreements
between the parties relating to such transactions.
29.2 Each of the parties acknowledges that in agreeing to enter into this
Agreement it has not relied on any pre-contractual representations
warranties or other assurances except those set out in this Agreement.
29.3 Each party hereby agrees that it shall have no remedy against the
other party for any innocent or negligent misrepresentation made by
such other party in relation to such transactions prior to this
Agreement being entered into except to the extent that the same shall
have been incorporated in this Agreement as a warranty representation
or indemnity in which case any claim in relation to the
56
same shall lie only on the basis of a breach of this Agreement or
under the relevant indemnity provision.
30. VARIATIONS
----------
No variation to this Agreement shall be effective unless in writing signed
by a duly authorised representative of each of the parties hereto.
31. WAIVER
------
31.1 Failure to exercise or delay in exercising on the part of any party
any right, power or privilege of that party under this Agreement shall
not in any circumstances operate as a waiver thereof nor shall any
single or partial exercise of any right, power or privilege in any
circumstances preclude any other or further exercise thereof or the
exercise of any other right, power or privilege.
31.2 Any waiver of a breach of any of the terms hereof or of any default
hereunder shall not be deemed a waiver of any subsequent breach or
default and shall in no way affect the other terms of this Agreement.
32. NOTICES
-------
Any demand, notice or communication in relation to this Agreement shall be
made in writing and served by hand, by registered or recorded delivery
post, or by facsimile transmission addressed to the recipient at its
registered office or its address stated below (or such other address or
facsimile number as a party may nominate in writing from time to time).
Xxxxx Xxxxx Aftermarket Operations
-----
Xxxxxxxxx Xxxx
Xxxxxxxx
Xxxx Xxxxxxxx
X00 0XX
For the attention of: Legal Director
Fax No: 0000 000 0000
57
The Company Prestolite Electric Limited
-----------
Xxxxxxxxx Xxxx
Xxxxxxx
Xxxxxxx
Xxxxxxxxxx
XX0 0XX
For the attention of: The Managing Director and Finance
Director
Fax No: 0000 000 0000
33. LANGUAGE
--------
33.1 The English language version of this Agreement shall be the
authoritative version even though it may have been translated into
some other language.
33.2 All communications between the parties shall unless otherwise agreed
in writing be in the English language.
34. ASSOCIATED COMPANY
------------------
Any act or omission of any Associated Company of Xxxxx or the Company (as
the case may be) which if committed or omitted by Xxxxx or the Company (as
the case may be) would have been a breach of this Agreement by Xxxxx or the
Company (as the case may be) will be deemed to be a breach of this
Agreement by Xxxxx or the Company (as the case may be) who will be liable
to the other party accordingly.
35. RELATIONSHIP OF THE PARTIES
---------------------------
Nothing contained in this Agreement shall be construed to imply that there
is any relationship between the parties of partnership or of employer/
employee nor are the parties hereby engaging in a joint venture and
accordingly neither of the parties shall have any right or authority to act
on behalf of the other nor to bind the other by contract or otherwise,
unless expressly permitted by the terms of this Agreement.
36. EXPENSES
--------
58
Except whether otherwise expressly provided herein each party will bear its
own costs and expenses in relation to the preparation, completion and
operation of this Agreement.
37. FURTHER ASSURANCE
-----------------
Xxxxx hereby agrees and declares that it will after the date hereof and
notwithstanding the sale and purchase hereunder of the LAO Assets execute
and deliver any other documents and take any other steps as shall
reasonably be required from time to time by the Company, at Xxxxx' expense,
to vest in the Company, or as it may direct, the LAO Assets (other than the
Contracts which are governed by clause 5) and otherwise give the Company
the full benefit of all the provisions of this Agreement.
38. TRUSTS
------
The perpetuity period applicable to any trusts created by this Agreement
shall be ten years commencing on the date of this Agreement.
39. COUNTERPARTS
------------
This Agreement may be executed in any number of counterparts and by the
several parties hereto on separate counterparts each of which when so
executed and delivered shall be an original but all the counterparts shall
together constitute one document.
40. APPLICABLE LAW
--------------
The formation, construction, performance, validity and all aspects
whatsoever of this Agreement shall be governed by the law of England and
Wales and the parties submit to the exclusive jurisdiction of the English
Courts.
59
SCHEDULE 1
----------
ACCOUNTING POLICIES RELATING TO THE STOCK
-----------------------------------------
Definition
----------
LAO Stock comprises the stock within the meaning given in clause 1.1 to that
expression.
Valuation
---------
Policy
------
. Stocks are valued at the lower of cost and net realisable value of separate
items of stock or of groups of similar items.
Definition
----------
. Cost - LAO Stock other than stock of Third Party Products - the SSAP9
transfer price at which the stock was originally transferred from the Acton
business to LAO.
In the case of Third Party Products comprised within the Stock - Cost - the
expenditure incurred in bringing them to their present location including
import duties, transport and handling costs and any other directly
attributable costs, less trade discounts, rebates and subsidies and without
the addition of any overhead allocation.
. Net Realisable Value - the actual or estimated selling price net of trade
but before settlement discounts.
Determination of Cost
---------------------
. The gross valuation must include all goods in stock and will be based on
cost, any diminution due to obsolescence and other causes being dealt with
separately by way of provisions. Gross cost will be arrived at by using
standard costing methods. Standard costs will be brought up-to-date shortly
before the valuation date. The valuation must be modified to recognise the
true cost of stock as required by SSAP9, adjustments would be made for
normal scrap, price variations etc.
60
Provisions
----------
. The purpose of provisions is to reduce the stock valuation to the lower of
cost and net realisable value.
. Inactive stock - all stock where no sales have been recorded during the
previous twelve months are inactive stocks, these will be provided for in
full. The only exception being where stock has been deliberately accumulated
in anticipation of a new sales campaign, the introduction of a new product
or model, or new legislation. In this case the stock will be measured
against the expected future demand and any excess provided for.
. Excess stock - a provision will be made for stocks which have moved during
the preceding year but which are excessive in relation to the expected
demand for the coming year such that any stocks in excess of one year's
supply will be fully written off.
. Defective stock - where goods are accepted from suppliers on partial
inspection only, a provision will be made for defective and perishable items
not revealed by the initial check. The amount should be recalculated at the
valuation date.
. Overvaluation - in any case where the net stock value exceeds the net
realisable value the difference must be provided for.
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SCHEDULE 2
----------
ANCILLARY AGREEMENTS
--------------------
Distribution Agreement for South Africa between (1) Xxxxx Limited and (2)
Xxxxx Automotive (Pty) Limited
Distribution Agreement for Argentina between (1) Xxxxx Limited and (2)
Xxxxx Indiel Argentina S.A.
South African Supply Agreement between (1) Xxxxx Limited and (2) Xxxxx
Automotive (Pty) Limited
Supply and Distribution Agreement for South America (excluding Argentina)
between (1) Xxxxx Indiel Argentina S.A. and (2) Xxxxx Diesel do Brasil Ltda
Acton Trade Xxxx Licence between (1) Xxxxx Industries plc and (2)
Prestolite Electric Limited
Argentina Trade Xxxx Licence between (1) Xxxxx Industries plc and (2) Xxxxx
Indiel Argentina S.A.
Marketing Services Agreement between (1) Xxxxx Limited and (2) Prestolite
Electric Limited
Overarching Agreement between (1) PEI Holding Incorporated (2) Xxxxx
Industries plc (3) Xxxxx Limited and (4) Prestolite Electric Limited
Licence of Intellectual Property relating to In-Line Diesel Pumps between
(1) Xxxxx Limited and (2) Prestolite Electric Limited
In-Line Diesel Pumps Supply Agreement between (1) Xxxxx Limited and (2)
Prestolite Electric Limited.
Umbrella Agreement between (1) Xxxxx Limited (2) Xxxxx Industries plc (3)
Xxxxx Diesel Do Brasil Ltda (4) Prestolite Electric Incorporated (5)
Prestolite Electric Limited(6) Xxxxx Indiel Argentina SA (7) Xxxxx
Automotive (Pty) Limited (8) Prestolite Newco Incorporated (9) PEI Holding
Incorporated
62
Argentina Sale and Purchase Agreement between (1) Xxxxx Industries plc (2)
Prestolite Electric Incorporated (3) Prestolite Newco Incorporated.
South Africa Sale and Purchase Agreement between (1) Xxxxx Industries plc
(2) Prestolite Electric Incorporated
Side Letter from Xxxxx Industries plc to Xxxxx Automotive (Pty) Ltd
concerning use of Trade Marks under the Supply Agreement
Side Letter from Xxxxx Industries plc to Xxxxx Indiel Argentina SA
concerning use of Trade Marks under the Supply Agreement.
Side Letter from Xxxxx Aftermarket Operations to Prestolite Electric
Limited concerning H.D.E units required for Xxxxx Exchange Unit Programme.
Side Letter from Xxxxx Industries plc to Xxxxx Automotive (Pty) Limited
concerning sales to Xxxxx Ricambi
63
SCHEDULE 3
----------
WARRANTIES
----------
Employees
---------
None of the employees employed by LAO for the purposes of the LAO Activity are
exclusively employed in the LAO Activity.
Litigation and Disputes
-----------------------
LAO is not at the date hereof in relation to the LAO Activity or the Contracts
engaged in any litigation, arbitration, administrative or criminal proceedings,
whether as plaintiff, defendant or otherwise, which materially and adversely
affects or is reasonably likely to have an adverse effect on the LAO Activity
and/or the LAO Assets.
Product Liability
-----------------
There is no claim in respect of Product Liability outstanding or threatened
against or so far as LAO is aware accepted by LAO in relation to the LAO
Activity.
Contracts and Contractual Arrangements
--------------------------------------
So far as LAO is aware no notice of termination of any such Contract has been
received or served by LAO.
Other than as a result of the arrangements contemplated herein LAO is not aware
of the invalidity of, or of any grounds for determination, rescission, avoidance
or repudiation, of any of the Contracts.
None of the Contracts:
(a) is an agency or distributorship agreement;
(b) is a contract in respect of which the primary supply is for services;
(c) requires LAO to pay any commission, finder's fee, royalty or the like;
(d) is in any way otherwise than in the ordinary course of business;
64
(e) in the reasonable opinion of LAO cannot readily be fulfilled or performed
by LAO on time without undue or unusual expenditure of money or effort.
Defaults
--------
So far as LAO is aware, neither LAO nor the LAO Activity nor any other party to
any agreement with LAO or the LAO Activity is in default under any of the
Contracts where such default has a material adverse effect on the continuance of
the LAO Activity.
Forward Currency Exchange
-------------------------
There are no forward currency exchange contracts which the Xxxxx Group has prior
to the date hereof entered into for the benefit of the LAO Activity and which
are current at the date hereof.
Sales Of Products
-----------------
Sales of Products in connection with the LAO Activity for the ten months to
November 1997 indicate that overall positive gross margins were achieved at each
of the Aftermarket, Original Equipment Service and MOD customer group levels.
65
SCHEDULE 5
----------
LIMITATIONS ON WARRANTIES AND INDEMNITIES
-----------------------------------------
1. Xxxxx shall be released from the effect of the Warranties but not the
Indemnities (as defined in paragraph 3.4 of this Schedule 5) to the extent
that the Company is aware at the date of this Agreement of any matters,
events or circumstances (whether the same are learned by any investigation
or enquiry made by or on behalf of the Company into the LAO Activity) and
which matters, events or circumstances would but for this paragraph 1
constitute a breach of any of the Warranties. For the purpose of this
paragraph the Company's awareness shall be determined by reference only to
the actual knowledge of Xx Xxx Xxxxxxx and Xx Xxx Xxxxxxxxx of Prestolite
Electric Incorporated, Xx Xxxx Xxx and Mr Xxxx Xxxxxxxxx of the Company and
of the Company's professional advisers (including the Company's Lawyers and
Coopers & Xxxxxxx), in respect of the matters the subject of this Agreement
2. Any claim the Company may have in respect of the Warranties shall sound in
damages only, subject to the provisions of this Schedule 5, and accordingly
the Company shall not have the right to rescind this Agreement or treat it
as having been repudiated by Xxxxx by reason of there having been any
breach of the Warranties.
3. The Company hereby agrees and acknowledges that notwithstanding anything to
the contrary contained in this Agreement the Warranties are subject to the
following:
3.1 no claim shall be capable of being made unless it shall be notified in
writing to Xxxxx on or before 31 March 1999 and any such claim which
has been made shall (if it has not been previously satisfied settled
or withdrawn) be deemed to have been withdrawn at the expiration of 6
months from the date on which the claim so notified when aggregated
with all other claims under this Agreement and under the Other Sale
Agreements exceeding (Pounds)5,000 exceeds (Pounds)150,000 unless
prior to such expiration legal proceedings in respect thereof shall
have already commenced by the delivery of a summons on Xxxxx;
3.2 the aggregate liability of Xxxxx under this Agreement and the Other
Sale Agreements in respect of all breaches of the Warranties shall not
when
66
aggregated with the liability of the person or persons defined as
the Vendor in each of the Other Sale Agreements in respect of all
breaches of the Other Warranties and Other Capped Indemnities exceed a
sum equal to (Pounds)12,000,000;
3.3 Xxxxx shall not be liable in respect of any single claim brought by
the Company for a breach of the Warranties, arising out of a single
event (provided that for the purposes of this paragraph 3.3 liability
in respect of a series of claims arising out of the same subject
matter shall be aggregated together as if such claims were one claim)
if the liability in respect of such claim would not exceed
(Pounds)5,000 (five thousand pounds). Xxxxx shall be liable in respect
of each and any claim for a breach of the Warranties in respect of
which the liability of Xxxxx exceeds (Pounds)5,000 (five thousand
pounds) only if the liability of Xxxxx for that claim, all other such
claims exceeding (Pounds)5,000 and all other such claims made under
the Other Sale Agreements in respect of all breaches of the Other
Warranties and Other Capped Indemnities would in aggregate exceed
(Pounds)150,000 and in that event Xxxxx shall only be liable for the
excess;
3.4 if any matter arises or gives rise to any claim under the Warranties
or any indemnities given by Xxxxx under this Agreement ("the
Indemnities") the Company shall as soon as reasonably practicable give
notice in writing to Xxxxx giving such details of the matter in
respect of which the claim is made as are at that time known to the
Company and (on the basis of the facts then known to the Company) the
bona fide estimated liability in respect thereof and where the claim
arises by reason of a claim made against the Company and/or Xxxxx
and/or any Purchaser Group Company and/or any Xxxxx Group Company by a
third party the Company shall not seek to settle or compromise the
matter and shall (if relevant) procure that the relevant company does
not seek to settle or compromise the same without the written consent
of Xxxxx (which consent shall not be unreasonably withheld or delayed)
and shall take such reasonable action as Xxxxx xxx require to avoid,
resist, contest and/or compromise any such claim on the basis that
Xxxxx shall be responsible for and shall bear all the reasonable costs
and expenses of the Company or the
67
relevant Purchaser Group Company in taking such action and in addition
shall to the extent that the same shall not have been borne by Xxxxx
directly indemnify the Company against the same and against all legal
costs incurred by or awarded against the Company as a direct result
thereof;
3.5 Xxxxx shall not be liable for any claim arising as a result of a
breach of Warranties:
3.5.1 or under the Indemnities if such claim would not have arisen
but for anything voluntarily done or omitted to be done by the
Company, or any Purchaser Group Company or any of its or their
employees, agents or successors in title after the date hereof
outside the ordinary course of business and which the Company,
any Purchaser Group Company or its or their employees agents or
successors in title were aware or ought reasonably to have been
aware could give rise to a claim; or
3.5.2 or the Indemnities to the extent that such claim relates to any
loss for which the Company or any Purchaser Group Company is
indemnified by insurance (but only to the extent of the amount
of the proceeds actually received from any applicable insurance
policy) and the Company agrees to pursue and to procure that
there is pursued all and any claims which there may be under or
in respect of any policy of insurance which relates or may
relate to the subject matter of the claim in question and to
provide to Xxxxx such evidence as Xxxxx xxx reasonably require
of having done so;
3.6 where the Company or any Purchaser Group Company is at any time
entitled to recover from a third party (other than as contemplated in
paragraph 3.5 above) any amount in respect of any matter giving rise
to a claim under the Warranties or the Indemnities or under any other
provisions of this Agreement the Company shall take and shall procure
that there is taken all reasonable steps to enforce any rights of
recovery that the Company or any Purchaser Group Company may have
against any third party in respect of the subject matter of the claim
and the Company or the relevant Purchaser Group
68
Company shall be indemnified by Xxxxx against all reasonable costs and
expenses including all legal costs incurred by it or them in doing so.
In the event that the Company or any Purchaser Group Company shall
receive any amount from such third party, the amount of the claim
against Xxxxx shall be reduced by the amount recovered less where not
already paid all such reasonable costs and expenses incurred by the
Company or any Purchaser Group Company Provided always that:
3.6.1 any failure by the Company to comply with such undertaking in
respect of any matter giving rise to a claim under the
Warranties or the Indemnities or otherwise under this Agreement
shall not affect in any way any liability of Xxxxx which
liability shall not be conditional upon the Company's
compliance with this undertaking save that Xxxxx shall be
entitled to say that the Company has not mitigated its loss or
that Xxxxx has a right of action or other claim against the
Company for breach of the provisions of this paragraph 3.6; and
3.6.2 in respect of any matter giving rise to a claim under the
Warranties or the Indemnities or otherwise under this Agreement
if the Company alleges that any steps which Xxxxx requires it
to take are unreasonable then the Company shall seek the
opinion of Queen's Counsel (such counsel to be of at least five
years' standing), the identity of whom shall be agreed upon by
Xxxxx and the Company and, failing such agreement within three
days after the date on which the arbitration is demanded, shall
be determined by the President of the Law Society (who may be
instructed by either Xxxxx or the Company to make the
nomination at any time after the expiry of that three day
period). In respect thereof the Company shall instruct counsel
in writing (or if such instructions are to be given orally then
Xxxxx shall be entitled to be present at and to contribute to
the giving of such instructions) and provide a copy of a draft
of such instructions before submission to counsel and
incorporate Xxxxx'x comments thereon. Counsel shall be asked to
advise whether, on the basis of the instructions given to him
69
and the information then made available to him, the action
sought by Xxxxx should be taken on the basis that, on the
balance of probabilities, the relevant claim against the third
party stands a reasonable prospect of success and the parties
shall follow the advice given in such opinion save that nothing
herein shall prevent or otherwise restrict the ability of Xxxxx
to argue (if such an argument is as a matter of law open to it)
that the Company has failed to mitigate its loss;
3.7 if Xxxxx pays at any time an amount pursuant to a claim in respect of
any Warranty or under any Indemnity or under any of the other
provisions of this Agreement and the Company and/or any Purchaser
Group Company subsequently becomes entitled to recover from some other
person any sum in respect of any matter giving rise to such claim the
Company shall take and shall procure that there is taken all
reasonable steps to enforce such recovery subject to being indemnified
by Xxxxx against all reasonable costs and expenses including all legal
costs incurred by any of them in doing so. The Company and/or any
Purchaser Group Company shall forthwith upon making any such recovery
(after deducting the costs incurred by the Company and/or any
Purchaser Group Company as contemplated by this clause to the extent
that Xxxxx has not indemnified the Company or the relevant Purchaser
Group Company for such costs) repay to Xxxxx so much of the amount
paid by Xxxxx to the Company in respect of the claim in question as
does not exceed the sum recovered from such other person;
3.8 without prejudice to the foregoing provisions of this Schedule 5
before the Company makes any payment or offers any other remedy or
takes any other remedial or corrective action in respect of any matter
for which it is entitled to an indemnity or to otherwise make a claim
against Xxxxx under the provisions of this Agreement, it shall and
shall procure that the relevant Purchaser Group Company gives a
reasonable opportunity and reasonable assistance to Xxxxx to verify
and, if appropriate, remedy the defect, default or omission or other
matter giving rise to the claim for indemnity or other remedy in
question;
70
3.9 payment or satisfaction by Xxxxx of any claim under any one particular
paragraph of the Warranties and/or under any Indemnity shall to the
extent of such payment or satisfaction satisfy and preclude any other
claim which is capable of being made in respect of the same subject
under another particular paragraph of the Warranties or under another
particular Indemnity. If and to the extent that the Company and/or
any Purchaser's Group Company recovers any sum under any provision of
this Agreement, including under the Indemnities, the amount of any
claim which the Company, or any Purchaser's Group Company may have in
respect of the same subject matter shall be reduced or eliminated
accordingly;
3.10 if any potential claim shall arise by reason of a liability of the
Company or relevant Purchaser Group Company being contingent only or
is otherwise not capable of being quantified then Xxxxx shall not be
under any obligation to make any payment pursuant to such claim until
such time as the contingent liability ceases to be contingent and
becomes capable of being quantified as the case may be;
3.11 any amount payable in respect of breach of any of the Warranties shall
be treated as a reduction in the consideration payable under clause 3
of this Agreement;
3.12 in this Schedule 5 the expressions "Other Sale Agreements" and "Other
Warranties" and "Other Capped Indemnities" shall have the same
meanings as in the Acton Sale and Purchase Agreement.
71
SIGNED by XXXXX XXXX-LEATHER ) /s/ Xxxxx Xxxx-Leather
------ ------------------ --------------------------------
as duly authorised attorney for ) Xxxxx Xxxx-Leather as attorney
and on behalf of XXXXX LIMITED ) ------------------
------------- of Xxxxx Limited
-------------
SIGNED by P. XXX XXXXXXX )
------ --------------
duly authorised for and on /s/ P. Xxx Xxxxxxx
behalf of PRESTOLITE ELECTRIC ) -------------------------------
------------------- Director
LIMITED ) --------
-------
72
