<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): January 4, 1999 (December 17,
1998)
UniComp, Inc.
- --------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
<TABLE>
<S> <C> <C>
Colorado 0-15671 84-1023666
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(State or Other (Commission (IRS Employer
Jurisdiction of Incorporation) File Number) Identification No.)
1850 Parkway Place, Suite 925, Marietta Georgia 30067
- ----------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
</TABLE>
Registrant's telephone number, including area code: (770) 424-3684
- --------------------------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)
1
<PAGE>
Item 2. Acquisition or Disposition of Assets
- ---------------------------------------------
On December 17, 1998, UniComp, Inc. (the "Company") completed the sale of
certain assets (the "Assets") of the Company's Northern Ireland subsidiary,
Aurora UniComp Limited, to Aurora SX3 Limited (the "Sale"). Aurora UniComp
Limited supplies and maintains computer hardware and software. The Assets
disposed of include, but are not limited to, the following: plant machinery and
motor vehicles, computer and office equipment, furniture, premises, tradename,
investments, and intellectual property rights. The Sale was consummated in
accordance with the terms of that certain Agreement for the Sale and Purchase of
Certain Assets and the Goodwill of Aurora UniComp Limited between Aurora UniComp
Limited, Aurora SX3 Limited, and UniComp, Inc., dated December 17, 1998 (the
"Sale Agreement").
The consideration paid to the Company in connection with the Sale was as
follows: (i) approximately 4.0 million pounds sterling (approximately $ 6.7
million U.S. as of December 17, 1998), of which 0.2 million pounds sterling
(approximately $ 0.3 million U.S. as of December 17, 1998) is being withheld
pending final calculation of certain completion accounts as set forth in detail
in the Sale Agreement; and (ii) assumption of debt of Aurora UniComp Limited
totaling approximately 3.3 million pounds sterling (approximately $ 5.5 million
U.S. as of December 17, 1998). In addition, Aurora SX3 Limited and UniComp
Holdings (UK) Limited executed and entered into a two-year loan whereby Aurora
SX3 Limited loaned 0.75 million pounds sterling (approximately $ 1.2 million
U.S. as of December 17, 1998) to UniComp Holdings (UK) Limited (the "Loan") and
agreed to loan an additional 0.25 million pounds sterling after UniComp Holdings
(UK) Limited timely meets the first twelve installment payments. The Loan bears
annual interest at the rate of .5% above the base lending rate of the Bank of
Ireland and the Loan shall be repaid in twenty-four equal monthly installment
payments of principle and Interest.
The total consideration paid in the Sale was determined through arm's length
negotiations between the parties. Neither the Company nor Aurora UniComp,
Limited, nor any of their affiliates had, or to the knowledge of the Company
or Aurora UniComp Limited, did any director or officer or any associate of any
such director or officer of the Company nor Aurora UniComp, Limited, have any
material relationship with Aurora SX3 Limited prior to the Sale.
2
<PAGE>
Item 7. Financial Statements and Exhibits
- -------------------------------------------
(a) Not Applicable.
(b) UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
The unaudited pro forma condensed combined financial statements are based on the
historical presentation of the consolidated financial statements of UniComp,
Inc. ("UniComp" or the "Company"). The unaudited pro forma balance sheet as of
August 31, 1998 gives effect to the Sale as if it occurred on August 31, 1998.
The unaudited pro forma statements of operations for the year ended February 28,
1998 and the six months ended August 31, 1998 give effect to the Sale as if it
had occurred on March 1, 1997.
The unaudited pro forma financial information is presented for informational
purposes only and it is not necessarily indicative of the financial position and
results of operations that would have been achieved had the Sale been completed
as of the dates indicated and is not necessarily indicative of the Company's
future financial position or results of operations.
The unaudited pro forma combined financial statements should be read in
conjunction with the historical consolidated financial statements and notes
thereto of the Company.
<PAGE>
Unaudited Pro Forma Condensed Combined Balance Sheet
As of August 31, 1998
(in Thousands)
<TABLE>
<CAPTION>
UNICOMP PRO FORMA PRO FORMA
CONSOLIDATED AURORA(1) ADJUSTMENTS COMBINED
------------ ----------- ----------- ---------
<S> <C> <C> <C> <C>
Current assets:
Cash and cash equivalents $ 618 $ - $ 7,925 (2) $ 8,543
Accounts and other receivables:
Trade, net 16,331 7,990 8,341
Other receivables 693 159 534
Inventory 4,739 1,518 3,221
Prepaid expenses 772 77 695
Other 595 - 595
------------ ----------- ----------- ---------
Total current assets 23,748 9,744 7,925 21,929
------------ ----------- ----------- ---------
Property and equipment, net 4,765 1,152 3,613
------------ ----------- ----------- ---------
Other assets:
Acquired and developed software, net 6,525 - 6,525
Goodwill, net 4,591 2,763 1,828
Deferred income taxes 1,193 - 1,193
Prepaid pension 754 - 754
Investment in joint ventures 449 119 330
Receivables from related parties 534 85 449
------------ ----------- ----------- ---------
Total other assets 14,046 2,967 - 11,079
------------ ----------- ----------- ---------
Total assets $ 42,559 $ 13,863 $ 7,925 $ 36,621
============ =========== =========== =========
Current liabilities:
Accounts payable $ 5,732 $ 2,323 $ - $ 3,409
Accrued expenses 1,978 58 1,920
Deferred revenue 3,653 1,938 1,715
Taxes payable 1,262 - 1,262
Other 121 - 121
Lines of credit 9,719 5,503 4,216
Current portion of notes payable 1,306 - 830 (3) 2,136
------------ ----------- ----------- ---------
Total current liabilities 23,771 9,822 830 14,779
------------ ----------- ----------- ---------
Long-term liabilities:
Notes payable 1,399 108 415 (3) 1,706
Deferred income taxes 1,278 - 1,278
Other long-term liabilities 53 - 53
------------ ----------- ----------- ---------
Total long-term liabilities 2,730 108 415 3,037
------------ ----------- ----------- ---------
Total liabilities 26,501 9,930 1,245 17,816
------------ ----------- ----------- ---------
2,747 (7)
Total stockholders' equity 16,058 3,933 (3,933) (6) 18,805
------------ ----------- ----------- ---------
Total liabilities and stockholders' equity $ 42,559 $ 13,863 $ 7,925 $ 36,621
============ =========== =========== =========
</TABLE>
<PAGE>
Unaudited Pro Forma Condensed Combined Statement of Operations
For the Twelve Months Ended February 28, 1998
(In Thousands, except per share information)
<TABLE>
<CAPTION>
UNICOMP PRO FORMA PRO FORMA
CONSOLIDATED AURORA(1) ADJUSTMENTS COMBINED
------------ ----------- ----------- ---------
<S> <C> <C> <C> <C>
Revenue:
Equipment $ 25,770 $ 14,909 $ - $ 10,861
Services 17,051 9,662 7,389
Software 9,285 9,285
------------ ----------- ----------- ---------
Total revenue 52,106 24,571 27,535
------------ ----------- ----------- ---------
Cost of sales:
Equipment 21,166 12,986 8,180
Services 2,819 1,833 986
Software 3,523 3,523
------------ ----------- ----------- ---------
Total cost of sales 27,508 14,819 12,689
------------ ----------- ----------- ---------
Gross profit 24,598 9,752 14,846
------------ ----------- ----------- ---------
Operating expenses:
Selling, general and administrative expenses 23,243 8,747 14,496
Acquisition related charges 1,085 - 1,085
------------ ----------- ----------- ---------
Total operating expenses 24,328 8,747 15,581
------------ ----------- ----------- ---------
Operating income 270 1,005 (735)
------------ ----------- ----------- ---------
Other (expense):
Other, net (6) (3) (3)
Interest, net (605) (255) 84 (4) (434)
------------ ----------- ----------- ---------
Total other (expense) (611) (258) (84) (437)
------------ ----------- ----------- ---------
Income before provision for income taxes (341) 747 (84) (1,172)
------------ ----------- ----------- ---------
Provision (Benefit) for income taxes 442 347 (28) (5) 67
------------ ----------- ----------- ---------
Income from continuing operations $ (783) $ 400 $ (56) $ (1,239)
============ =========== =========== =========
Basic and diluted earnings per share $ (0.10) $ (.16)
============ =========
Weighted average number of shares - basic and diluted 7,727 7,727
</TABLE>
<PAGE>
Unaudited Pro Forma Condensed Combined Statement of Operations
For the Six Months Ended August 31, 1998
(In Thousands, except per share information)
<TABLE>
<CAPTION>
UNICOMP PRO FORMA PRO FORMA
CONSOLIDATED AURORA(1) ADJUSTMENTS COMBINED
------------ ----------- ----------- ---------
<S> <C> <C> <C> <C>
Revenue:
Equipment $ 13,484 $ 8,493 $ - $ 4,991
Services 10,281 5,131 5,150
Software 3,863 3,863
------------ ----------- ----------- ---------
Total revenue 27,628 13,624 14,004
------------ ----------- ----------- ---------
Cost of sales:
Equipment 11,066 7,291 3,775
Services 1,583 1,116 467
Software 1,706 1,706
------------ ----------- ----------- ---------
Total cost of sales 14,355 8,407 5,948
------------ ----------- ----------- ---------
Gross profit 13,273 5,217 8,056
------------ ----------- ----------- ---------
Operating expenses:
Selling, general and administrative expenses 13,083 4,942 8,141
------------ ----------- ----------- ---------
Acquisition related charges - - -
------------ ----------- ----------- ---------
Total operating expenses 13,083 4,942 8,141
------------ ----------- ----------- ---------
Operating income 190 275 (85)
------------ ----------- ----------- ---------
Other (expense):
Other, net (4) (1) (3)
Interest, net (446) (150) (42) (4) (338)
------------ ----------- ----------- ---------
Total other (expense) (450) (151) (42) (341)
------------ ----------- ----------- ---------
Income before provision for income taxes (260) 124 (42) (426)
------------ ----------- ----------- ---------
Provision (Benefit) for income taxes - 94 (14) (5) (108)
------------ ----------- ----------- ---------
Income from continuing operations $ (260) $ 30 $ (28) $ (318)
============ =========== =========== =========
Basic and diluted earnings per share $ (0.03) $ (0.04)
============ =========
Weighted average number of shares - basic and diluted 7,920 7,920
</TABLE>
3
<PAGE>
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
(1) Derived from the historical stand alone financial statements of Aurora.
(2) Represents cash proceeds from the Sale of $6.7 million plus the proceeds
from the $1.2 million buyer loan discussed below.
(3) Represents a $1.2 buyer loan, payable in 24 equal monthly installments and
bearing interest at the base rate of the Bank of Ireland plus .5%.
(4) Represents interest expense from the $1.2 buyer loan.
(5) Represents the tax effect of the pro forma adjustments using the Company's
statutory tax rate of 33%.
(6) Represents the elimination of the net assets of Aurora.
(7) Represents the pretax gain on the Sale.
4
<PAGE>
(c) Exhibits
<TABLE>
<S> <C>
- ------------------------------------------------------------------------------------------------
Exhibit 2.1 Agreement for the Sale and Purchase of Certain Assets and the Goodwill of Aurora
UniComp Limited, dated December 17, 1998.
- ------------------------------------------------------------------------------------------------
Exhibit 99.1 Loan Agreement by and between Aurora SX3 Limited and UniComp Holdings (UK)
Limited, dated December 17, 1998.
- ------------------------------------------------------------------------------------------------
Exhibit 99.2 Mortgage by and between UniComp Holdings (UK) Limited and Aurora SX3 Limited,
dated December 17, 1998.
- ------------------------------------------------------------------------------------------------
Exhibit 99.3 Fixed and Floating Charge and Debenture by and between ICS UniComp Limited,
Unibol Limited, ICS Computing Group Limited, Aurora UniComp Limited, and Aurora
SX3 Limited, dated December 17, 1998.
- ------------------------------------------------------------------------------------------------
Exhibit 99.4 Guarantee and Indemnity by and between UniComp, Inc., ICS UniComp Limited,
Unibol Limited, ICS Computing Group Limited, Aurora UniComp, Limited, and Aurora
SX3 Limited, dated December 17, 1998.
- ------------------------------------------------------------------------------------------------
</TABLE>
5
<PAGE>
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
UNICOMP, INC.
Dated: January 4, 1999 By: /s/ Hugh Moore
--------------------
Hugh Moore
Chief Accounting Officer
6
<PAGE>
DATED THIS 17 DAY OF DECEMBER 1998
AURORA UNICOMP LIMITED
(Vendor) (1)
AURORA SX3 LIMITED
(PURCHASER) (2)
UNICOMP INC
(GUARANTOR) (3)
AGREEMENT FOR THE SALE AND PURCHASE
-----------------------------------
OF CERTAIN ASSETS AND THE GOODWILL OF
-------------------------------------
AURORA UNICOMP LIMITED
----------------------
CARSON & MCDOWELL
SOLICITORS
MURRAY HOUSE
MURRAY STREET
BELFAST BT1 6HS
1
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
1 INTERPRETATION............................................................... 4
--
2 AGREEMENT FOR SALE........................................................... 9
--
3 CONSIDERATION AND COMPLETION ACCOUNTS........................................ 11
--
4 COMPLETION................................................................... 13
--
5 NAME......................................................................... 14
--
6 UNDERTAKINGS................................................................. 15
--
7 RESTRICTIONS................................................................. 16
--
8 ASSISTANCE FOLLOWING COMPLETION.............................................. 18
--
9 EMPLOYEES.................................................................... 18
--
10 CREDITORS AND DEBTORS........................................................ 21
--
11 WARRANTIES................................................................... 22
--
12 APPORTIONMENTS/PREPAYMENTS................................................... 23
--
13 CONTRACTS.................................................................... 24
--
14 LEASED PLANT AND EQUIPMENT................................................... 26
--
15 VAT.......................................................................... 26
--
16 INSURANCE.................................................................... 27
--
17 GUARANTEE.................................................................... 27
--
18 FURTHER ASSURANCE............................................................ 29
--
19 SURVIVAL OF CERTAIN PROVISIONS............................................... 29
--
20 ANNOUNCEMENTS................................................................ 30
--
21 ENTIRE AGREEMENT............................................................. 30
--
22 WAIVER....................................................................... 30
--
23 NOTICES...................................................................... 30
--
24 MISCELLANEOUS................................................................ 31
--
25 COUNTERPARTS................................................................. 31
--
26 INVALIDITY................................................................... 32
--
27 LAW AND JURISDICTION......................................................... 32
--
SCHEDULE 1....................................................................... 34
--
PREMISES.................................................................... 34
--
SCHEDULE 2
WARRANTIES.................................................................. 35
--
INTERPRETATION.............................................................. 35
--
ACCOUNTS.................................................................... 36
--
POSITION SINCE ACCOUNTS DATE................................................ 37
--
PREMISES.................................................................... 38
--
OTHER ASSETS................................................................ 42
--
INTELLECTUAL PROPERTY RIGHTS................................................ 43
--
COMPUTER EQUIPMENT AND SOFTWARE............................................. 44
--
LIABILITIES ETC............................................................. 47
--
COMMERCIAL ARRANGEMENTS..................................................... 47
--
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
BUSINESS.................................................................... 49
--
RESTRICTIVE PRACTICES....................................................... 50
--
LITIGATION AND OFFENCES..................................................... 51
--
INSURANCES.................................................................. 51
--
EMPLOYEES................................................................... 52
--
PENSIONS.................................................................... 54
--
ENVIRONMENTAL MATTERS....................................................... 55
--
THE VENDOR'S ACTIVITIES..................................................... 57
--
MISCELLANEOUS............................................................... 57
--
SCHEDULE 3....................................................................... 59
--
EMPLOYEES................................................................... 59
--
SCHEDULE 4
EXCLUDED ASSETS............................................................. 60
--
SCHEDULE 5
PENSIONS.................................................................... 61
--
SCHEDULE 6
COMPLETION ACCOUNTS......................................................... 65
--
SCHEDULE 7
PART 1 MAINTENANCE CONTRACTS................................................ 67
--
SCHEDULE 7
PART 2 REMAINING CONTRACTS.................................................. 68
--
SCHEDULE 8
HIRE/LEASE AGREEMENTS....................................................... 69
--
SCHEDULE 9
PLANT AND COMPUTER EQUIPMENT................................................ 70
--
SCHEDULE 10
VENDOR'S PROTECTION PROVISIONS.............................................. 71
--
ASSIGNMENT OF GOODWILL........................................................... 74
--
ASSIGNMENT OF DEBTORS............................................................ 78
--
</TABLE>
3
<PAGE>
AGREEMENT FOR SALE OF ASSETS
----------------------------
AGREEMENT dated 17 day of December 1998.
BETWEEN
- -------
(1) AURORA UNICOMP LIMITED having its registered office at UniComp House,
Mallusk Road, Newtonabbey, BT36 8WU (hereinafter called "the Vendor") of
the first part
(2) AURORA SX3 LIMITED having its registered office at 120 Malone Road, Belfast
BT9 5HT (hereinafter called "the Purchaser") of the second part; and
(3) UNICOMP INC a Colorado company having its corporate headquarters at 1850
Parkway Place, Suite 925, Marietta GA 30067 (hereinafter called "the
Guarantor") of the third part;
WHEREAS:-
1 The Vendor carries on the business of the supply and maintenance of computer
hardware and software and all services relating thereto at the Premises
2 The Vendor has agreed to sell and the Purchaser has agreed to purchase the
said business carried on by the Vendor at the location aforesaid together
with certain assets (as herein described) on the terms hereinafter set
forth.
IT IS HEREBY AGREED as follows:
1 INTERPRETATION
1.1 In this Agreement (and the Schedules hereto) the following expressions
shall (unless the context otherwise requires) have the following
meanings respectively:-
"THE ACCOUNTS" the audited balance sheet of the Vendor as at the
Accounts Date and the audited profit and loss
account in respect of the nine month period ended
on the
4
<PAGE>
Accounts Date including any notes thereon and any
reports statements or documents annexed or
attached thereto.
"THE ACCOUNTS DATE" the 28th February 1998.
"THE AGREED DRAFT" in relation to any document means the draft of
the document which is annexed to this agreement
and which for the purposes of identification has
been signed by or on behalf of the Vendor and the
Purchaser.
"THE ASSETS" means the property, assets and undertaking of the
Business to be sold by the Vendor to the
Purchaser pursuant to clause 2.
--------
"THE BOOK DEBTS" the trade debts (for the avoidance of doubt
excluding any amounts included in Excluded
Assets) owed to the Vendor in relation to the
Business as shown in the Completion Accounts,
together with all debts created since the
Effective Date save for amounts due by the Inland
Revenue, HM Customs and Excise or the Guarantor's
Group.
"THE BUSINESS" the business of the supply and maintenance
of computer hardware and software and all
services relating thereto carried on by the
Vendor at the Effective Date.
"BUSINESS SERVICES" means the voice and data communication services
provided by the Megastream Link being Internet
Mail Gateway, Voice Mail System and Data Link.
"COMPLETION" the 17 day of December 1998.
"THE COMPLETION ACCOUNTS" means the balance sheet and profit and loss
account of the Vendor for the period ending on
the Effective Date prepared on the basis set out
at Schedule 6 hereto.
"THE CONTRACTS" the current contracts and engagements of the
Vendor
5
<PAGE>
in relation to the Business as listed in Schedule
--------
7 hereto but excluding contracts with Employees.
-
"THE CREDITORS" the creditors of the Vendor (excluding all
amounts due to the Inland Revenue, H.M.
Customs and Excise or any member of the
Guarantor's Group, any provision for deferred
taxation and any accruals for professional
fees and profit related pay) in relation to
the Business as shown in the Completion
Accounts, together with such amounts (save
for amounts due to the Inland Revenue, HM
Customs and Excise or the Guarantor's Group)
as are agreed or determined in accordance
with clause 3.4 hereto to be due to the
creditors listed at Appendix 1 hereto for the
period from the Effective Date to Completion.
"THE DISCLOSURE LETTER" means the letter bearing the same date as this
agreement (including the documents appended to it)
written by the Vendor`s Solicitors to the
Purchaser's Solicitors and qualifying the
Warranties
"THE EFFECTIVE DATE" close of business on the 30th November 1998.
"THE EMPLOYEES" the employees of the Vendor in relation to the
Business particulars of whom are set out at
Schedule 3.
----------
"THE EQUIPMENT" the computer equipment listed in Schedule 9 and
----------
all office equipment and furniture on or about the
Premises.
"THE EXCLUDED ASSETS" the assets and liabilities listed in Schedule 4
----------
hereto which are owned by the Vendor but are
excluded from the sale to the Purchaser.
"THE GOODWILL" the goodwill of the Business including the right
to the exclusion of the Vendor to trade under the
Name and
6
<PAGE>
the exclusive right for the Purchaser or its
assignee to represent itself as carrying on
the Business in succession to the Vendor.
"THE GUARANTOR'S GROUP" means the group of companies comprising the
Guarantor its Subsidiaries and Holding
Companies and the Subsidiaries of any such
Holding Companies
"THE HIRE/LEASE AGREEMENTS" the agreements relating to the plant and
equipment leased or hired to the Vendor or on
hire purchase to the Vendor used in the
Business as listed in Schedule 8 hereto.
----------
"THE INTELLECTUAL PROPERTY
RIGHTS" all industrial and intellectual property
rights of the Vendor including without
limitation all patents registered trade marks,
registered designs and applications for any of
the same and unregistered trade marks and all
copyrights, know-how and confidential
information belonging to the Vendor and used
in connection with the Business.
"THE INVESTMENTS" the Vendor's holdings of
(a) 10,001 ordinary shares of (Pounds)1 each
in Creative On Line Media Limited
(b) 1 ordinary share of (Pounds)1 in Restart
(Ireland) Limited
"KNOW-HOW" the industrial information and techniques
owned by the Vendor and used in for the
purpose of assisting in the processing of
goods or materials whether patentable or not
including inventions, discoveries,
improvements, techniques, processes, formulae,
drawings, designs, specifications, manuals,
instructions and lists, in each case whether
written or unwritten.
"THE KNOW-HOW ELECTION" means the election in the terms of the agreed
draft to be executed by the parties at
Completion
7
<PAGE>
"THE LEASE" the leases under which the Premises are
held by the Vendor.
"THE MAINTENANCE CONTRACTS" the contracts relating to hardware and
software maintenance listed in Part 1 of
---------
Schedule 7 hereto.
------------------
"MEGASTREAM LINK" means the voice and data communication link
currently rented from British Telecom by
Unibol Limited allowing communication
between the Mallusk and West Bank Drive
sites (being two of the Premises).
"THE NAME" "Aurora"
"NET TANGIBLE ASSETS" means all the fixed and current assets of
the Vendor (excluding the Excluded Assets
and the Premises (save and except for
capital improvements to the Premises) and
any intangible assets) less the Creditors
as shown by the Completion Accounts.
"THE PLANT" the plant machinery and motor vehicles as
listed in Schedule 9, and all other fitting
----------
chattels and other assets used in
connection with the Business.
"THE PREMISES" the premises occupied by the Vendor as
listed in Schedule 1 hereto
----------
"THE PURCHASER'S ACCOUNTANTS" means Messrs Ernst & Young of Bedford House
Bedford Street Belfast
"THE REGULATIONS" the Transfer of Undertakings (Protection of
Employment) Regulations 1981.
"THE STOCKS" means the stocks including (without
limitation) raw materials, work-in-progress
and finished goods owned by the Vendor at
Completion for the purposes of or in
connection with the Business including
items which although subject to reservation
of title by the sellers, are under the
control of the Vendor.
"SUBSIDIARY" AND "HOLDING shall be construed in accordance with
COMPANIES" Article 4 of the Companies (Northern
Ireland) Order 1986.
8
<PAGE>
"UNICOMP HOLDINGS" means UniComp Holdings (UK) Limited of Acre
House, 11-12 William Street, London NW1 3ER
"THE WARRANTIES" means the representations and warranties on
the part of the Vendor set out in Schedule 2.
----------
1.2 All references to a statutory provision shall be construed as
including references to:
1.2.1 any statutory modification, consolidation or re-enactment
(whether before or after today's date) for the time being in
force;
1.2.2 all statutory instruments or orders made pursuant to it;
1.2.3 any statutory provisions of which it is a consolidation, re-
enactment or modification.
1.3 Except where the context otherwise requires, words denoting the
singular include the plural and vice versa; words denoting any gender
include all genders; words denoting persons include firms and
corporations and vice versa;
1.4 The expression the Vendor shall include its successors and assigns (if
any).
1.5 Unless otherwise stated, a reference to a clause, sub-clause or
Schedule is a reference to a clause or a sub-clause of, or a Schedule
to, this Agreement.
1.6 Clause headings are for ease of reference only and do not affect the
construction of this Agreement.
1.7 The Schedules and Appendices form part of this Agreement.
2 AGREEMENT FOR SALE
2.1 Subject to the terms and conditions of this agreement the Vendor shall
sell as beneficial owner and the Purchaser shall purchase as at and
from the Effective Date (save for any assets acquired or created by
the Vendor in trust for the Purchaser after the Effective Date
(including without limitation, Stocks and
9
<PAGE>
Maintenance Contracts) which are purchased with effect from the date
of their acquisition or creation) the Business as a going concern and
the following assets
2.1.1 the Plant
2.1.2 the Equipment
2.1.3 the Premises
2.1.4 the Goodwill
2.1.5 the Investments
2.1.6 the Intellectual Property Rights
2.1.7 the Name
2.1.8 the records and documents referred to at 3.3.2 below
-----
2.1.9 the benefit of the Contracts so far as the Vendor can assign
the same
2.1.10 the Stocks
2.1.11 the benefit subject to the burden of the Hire/Lease Agreements
2.1.12 all rights and claims of the Vendor against third parties
(including without limitation all rights in connection with
such third parties' guarantees conditions indemnities
warranties and representations) with respect to the Business so
far as the Vendor can assign the same other than as comprised
in the Excluded Assets
2.1.13 without in any way limiting the generality of the foregoing all
other assets (if any) of whatever nature employed in the
Business at the Effective Date or at Completion but excluding
the Excluded Assets
2.2 The consideration to be paid by the Purchaser for the Assets shall be
apportioned between the Assets as follows:-
2.2.1 Goodwill (Pounds) 2,950,000
2.2.2 Intellectual Property (Pounds) 350,000 and
2.2.3 the remaining Assets, in accordance with the values ascribed
thereto by the Completion Accounts (any items to which no such
value is ascribed in the Completion Accounts being valued at
(Pounds) 1)
2.3 The consideration shall be paid as follows:
2.3.1 as to (Pounds) 3,800,000 in cash upon Completion of the
purchase in accordance
10
<PAGE>
with clause 4.4;
----------
2.3.2 as to the balance (if any) in accordance with clause 3.
--------
2.4 The consideration shall be exclusive of any value added tax.
3 CONSIDERATION AND COMPLETION ACCOUNTS
3.1 The consideration to be paid by the Purchaser for the Assets shall be
the sum of (Pounds) 4,500,000 subject to adjustment as herein provided
3.2 The Completion Accounts shall be prepared by the Vendor on the basis
set out at Schedule 6 hereto. The Completion Accounts shall be
reviewed by the Purchaser's Accountants. The Vendor shall procure
that the draft Completion Accounts shall be prepared and be available
for such review by the Purchaser's Accountants within 28 days of
Completion. Any points of difference arising as a result of the said
review shall be notified to the Vendor in writing within 28 days from
the date on which the draft Completion Accounts became available
failing which the Vendor shall be deemed to have accepted such draft.
3.3 If the Purchaser's Accountants notify the Vendor that they do not
accept the draft Completion Accounts, points of difference shall be
discussed between the Purchaser's Accountants and the Vendor and if
they are unable to reach agreement within 10 days any points
outstanding shall be referred to an independent Firm of Chartered
Accountants agreed between the parties or failing agreement within 7
days of one party requesting the other to agree to such appointment on
the application of any party by the Chairman for the time being of the
Ulster Society of the Institute of Chartered Accountants in Ireland.
The said Independent Firm shall be entitled to call for and inspect
the working papers of the Vendor and such other documents as the Firm
may reasonably consider necessary. In settling any such points of
difference the said independent Firm shall act as experts and not as
arbitrators. Their decision shall be final and binding on all
concerned and their costs shall be borne equally between the
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Vendor and the Purchaser. In giving such decision the said independent
Firm shall state what adjustments (if any) are to be made to the draft
Completion Accounts. Once all points of difference have been agreed or
determined or deemed to have been agreed (but not before) the
Completion Accounts which shall be final and binding on the parties
but shall in no way affect any claim which the Purchaser may have
against the Vendor in respect of any breach of any of the warranties
representations undertakings and indemnities given by the Vendor under
this Agreement.
3.4 The Vendor shall prepare a draft list showing the amounts due to the
creditors listed at Appendix 1 hereto for the period from the
Effective Date to Completion for review by the Purchaser within 28
days of Completion. Any points of difference arising as a result of
the said review shall be notified to the Vendor in writing within 28
days from the date on which the draft list became available failing
which the Vendor shall be deemed to have accepted such draft. If the
Purchaser notifies the Vendor that it does not accept the draft list,
points of difference shall be dealt with in the manner set out at
clause 3.3 above
3.5 If the value of the Net Tangible Assets is greater than
(Pounds)1,250,000 then the consideration shall be increased by a sum
equal to the difference between the value of the Net Tangible Assets
and (Pounds)1,200,000.
3.6 If the value of the Net Tangible Assets is less than (Pounds)1,150,000
then the consideration shall be decreased by a sum equal to the
difference between the value of the Net Tangible Assets and
(Pounds)1,200,000.
3.7 In the event that the payment of (Pounds)3,800,000 already paid in
accordance with clause 2.3.1 exceeds the amount of the consideration
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(after adjustment in accordance with clause 3.4 or clause 3.5 if
appropriate) the excess shall be repaid to the Purchaser within 7 days
of the Completion Accounts being finalised in accordance with clause
3.2 or 3.3 as appropriate.
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3.8 In the event that the payment of (Pounds)3,800,000 already paid in
accordance with clause 2.3.1 is less than the amount of the
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consideration (after adjustment in accordance with clause 3.4 or
clause 3.5 if appropriate) the shortfall shall be paid to the Vendor's
Solicitors Messrs Johns Elliot (whose receipt shall be a good
discharge to the Purchaser) within 7 days of the Completion Accounts
being finalised in accordance with clause 3.2 or 3.3 as appropriate.
3.9 Any payment due to be made under the terms of this Agreement shall if
not paid on the due date bear interest at the then current Bank of
Ireland Base Rate plus 4%.
4 COMPLETION
4.1 The sale and purchase shall be completed at Restart Limited, Business
Recovery Centre, Isle of Man Freeport, Ballasalla, Isle of Man, IM9
2AP immediately on exchange of this agreement when all the matters
set out in this clause 4 shall be effected.
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4.2 The Vendor shall deliver to the Purchaser, at the principal office of
the Business, such of the Assets as are capable of being transferred
by delivery.
4.3 The Vendor shall cause to be delivered or (if so requested by the
Purchaser) made available to the Purchaser:
4.3.1 such documents as are required by the Purchaser's solicitors to
complete the sale and purchase of the Assets and vest title to
the Assets in the Purchaser, including (but without limitation)
assignments of the Goodwill Contracts, and Leases in the terms
of the agreed draft;
4.3.2 forms of transfer duly executed by it and CMI Limited in favour
of the Purchaser or its nominees in respect of
(a) 10,001 ordinary shares of (Pounds)1 each in Creative On
Line Media Limited
(b) 1 ordinary share of (Pounds)1 in Restart (Ireland) Limited
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together with the relative share certificates and such waivers
consents and other documents as may be required to give a good
title to such shares and to enable the Purchaser or its nominees
to become the registered holders;
4.3.3 all books of account, payroll accounts, income records, stock
records, computer programs, information relating to the
customers and suppliers of the Business, lists of customers, and
all other books, records, and documents relating to the Business
in the Vendor's possession or control;
4.3.4 the written consent of any mortgagee or other person whose
consent is necessary for the sale of any of the assets hereby
agreed to be sold together with an appropriate release
(including, without limitation, a release from the Bank of
Ireland of the Book Debts);
4.3.5 appropriate certified Board Minutes of the Vendor authorising
execution of this Agreement, the assignments referred to at
clause 4.3.1 and any other ancillary documentation;
4.3.6 the Know- How Election duty executed by the Vendor
4.4 Upon completion of the matters referred to above the Purchaser shall
deliver to the Vendor a banker's draft in respect of the part of the
purchase consideration specified in clause 2.3.1.
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4.5 If any or all of the transactions set out in clause 4.2 and 4.3 do not
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take place as provided the Purchaser may promptly rescind this
agreement without prejudice to any other remedy it may have.
5 NAME
5.1 With immediate effect following Completion the Vendor shall cease to
use the Name for trading purposes or refer to itself in any way or
hold itself out in any way as having any relationship with the
Purchaser;
5.2 The Vendor undertakes to change its name
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5.2.1 prior to taking any action, or permitting any action to be
taken, which would result in the winding up for dissolution of
the Vendor or
5.2.2 if the Purchaser reasonably considers that the Vendor should
change its name to avoid an adverse effect on the Business
following Completion or
5.2.3 in any event within 12 months of Completion
and further undertakes to produce to the Purchaser, a certified copy
of a special resolution of the Vendor resolving to change its name to
a name unconnected with the Business.
6 UNDERTAKINGS
6.1 The Vendor hereby undertakes:
6.1.1 to pay all debts and liabilities and to observe and perform all
obligations relating to the Business or any of the Assets
incurred prior to Completion other than any such debts or
liabilities due to the Creditors (to the extent included in the
Completion Accounts or listed at Appendix 1), or incurred at
the written request of the Purchaser; and
6.1.2 to indemnify the Purchaser against all losses costs claims and
demands arising in respect of any breach or non-performance of
the foregoing covenant.
6.2 The Purchaser hereby undertakes:
6.2.1 to pay all debts and liabilities of and to observe and perform
all obligations relating to the Business or any of the assets
hereby agreed to be sold incurred on or after Completion or
incurred prior to Completion at the written request of the
Purchaser; and
6.2.2 to indemnify the Vendor against all losses costs claims and
demands arising in respect of any breach or non-performance of
the foregoing covenant.
7 RESTRICTIONS
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7.1 The Vendor hereby covenants with the Purchaser with the intent of
assuring to the Purchaser the full benefit and value of the Goodwill
and connections of the Business and as a constituent part of the
agreement for the sale of the Business that:-
7.1.1 it will not (and will procure that no member of the Guarantor's
Group will) for a period of five (5) years from Completion
("the Said Period") directly or indirectly and whether for its
own account or in partnership with another or others either as
principal or as servant or agent or officer of another deal
with or engage in business with or be interested in any concern
undertaking firm or body corporate which engages in or carries
on within the United Kingdom and/or the Republic of Ireland any
business which competes or seeks to compete with the Business;
7.1.2 it will not (and will procure that no member of the Guarantor's
Group will) at any time following Completion divulge to any
person or otherwise make use of any secrets, trade secrets,
confidential knowledge or information concerning the business
finance or affairs of the Business and belonging to the
Business and will use its best endeavours to prevent the
publication or disclosure of any such secrets, knowledge or
information by any third party;
7.1.3 without prejudice to the generality of the provisions contained
in the immediately preceding sub-clauses 7.1.1 and 7.1.2 it
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will not (and will procure that no member of the Guarantor's
Group will) for the Said Period directly or indirectly in
competition with the Business;
7.1.3.1 solicit the custom of any person, firm or company
which has at any time during the period of one
year preceding Completion been a customer or
client of the Business or which has approached in
any such period as aforesaid the Business with a
view to placing business or otherwise becoming a
customer or client of the Business;
7.1.3.2 solicit or endeavour to entice away, or employ, or
offer or conclude any contract of services with
any person
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who was employed by the Vendor at any
time during the period of one year preceding
Completion.
Provided always that nothing in this Agreement shall restrict ICS
Unicomp Limited from carrying out its current business of the sale of
computer hardware.
7.2 While the restrictions aforesaid are considered by the parties to be
fair and reasonable in all the circumstances it is agreed that if any
of such restrictions shall be adjudged to be void or ineffective for
whatever reason but would be adjudged to be valid and effective if
part or parts of the wording thereof were deleted or the periods
thereof reduced or the area thereof reduced in scope the said
restrictions shall apply with such modifications as may be necessary
to make them valid and effective.
7.3 The Vendor shall promptly refer to the Purchaser all enquiries
relating to the Business and assign to the Purchaser all orders
relating to the Business which the Vendor may in future receive.
7.4 No provision of this agreement or of any agreement or arrangement of
which it forms part by virtue of which the agreement constituted by
all of the foregoing is subject to registration (if such be the case)
under the Restrictive Trade Practices Act 1976 shall take effect until
the day after particulars of such agreement have been furnished to the
Director General of Fair Trading pursuant to the terms of Section 24
of that Act
8 ASSISTANCE FOLLOWING COMPLETION
8.1 The Vendor will for a period of one month following Completion to the
best of its ability but without incurring any liability or expense
initiate the Purchaser's representatives into the conduct of the
Business and give the Purchaser's representatives information known to
the Vendor (not being information in the public domain) that may
reasonably be required in connection with the carrying on
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of the Business and shall also after Completion but without incurring
any expenses or liability procure for the Purchaser the full benefit
and advantage of the goodwill of the Business by recommending and
introducing the Purchaser to customers and otherwise as far as
practicable but without requiring any personal attendance by any
representative of the Vendor after expiry of the period of one month
following Completion.
8.2 The Vendor agrees to procure that the Business Services currently
provided via the Megastream Link to the Mallusk and West Bank Drive
sites (being two of the Premises) will continue in operation without
interruption or diminution until terminated by the Purchaser or after
one year whichever is the earlier.
8.3 The Purchaser undertakes with the Vendor to co-operate with the Vendor
and at reasonable commercial rates to the Vendor to provide assistance
and manpower to enable the Vendor to continue to operate the business
of Aurora UniComp (IOM) Limited (which is being excluded from the
sale) for a sufficient period to enable the Vendor to wind down such
business until it ceases such business, or until the Vendor is able to
make alternative arrangements or for a period of 12 months whichever
is the shorter.
9 EMPLOYEES
9.1 If as a result or by virtue of -
9.1.1 the acquisition by the Purchaser of the Business and Assets or
anything acquired or transferred in connection with same
and/or;
9.1.2 the application of the Regulations any person other than an
Employee shall become or otherwise be deemed to be or shall
claim to have become an employee of the Purchaser:-
9.1.2.1 the Purchaser may (as soon as practicable after
becoming aware of such fact) give formal notice to
terminate any employment and/or any contract of
employment of such person; and
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9.1.2.2 the Vendor will indemnify the Purchaser against all
costs claims liabilities and expenses (including
legal expenses) arising out of or in connection
with -
(a) any such termination;
(b) the transfer of liabilities and duties in
relation to such person from the Vendor to the
Purchaser pursuant to the Regulations;
(c) any claim by such person that he has become an
employee of the Purchaser and that the
liabilities and duties of the Vendor in
relation to him have been transferred to the
Purchaser pursuant to the Regulations.
9.2 The Purchaser may defend or settle or comprise any such claim or
allegation of liability as the Purchaser shall in its absolute
discretion see fit and may require the Vendor to indemnify the
Purchaser against all costs claims liabilities and expenses (including
legal expenses) arising out of or in connection with so doing.
9.3 The Vendor shall indemnify the Purchaser against each and every cost
claim liability expense or demand which relates to or arises out of
any act or omission by the Vendor or any other event or occurrence
prior to the date of Completion and which the Purchaser may incur in
relation to any contract of employment or any collective agreement
concerning the Employees pursuant to the Regulations including without
limitation any such matter relating to or arising out of:
9.3.1 the Vendor's rights powers duties and/or liabilities under or
in connection with any such contract of employment and any such
collective agreements (which rights powers duties and/or
liabilities are or will be transferred to the Purchaser in
accordance with the Regulations)
9.3.2 anything done or omitted before the date of Completion by or in
relation to the Vendor in respect of any contract of employment
or any such collective agreements or any person employed in the
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Business which is deemed to have been done or omitted by or in
relation to the Purchaser in accordance with the Regulations
9.3.3 the Vendor's failure to pay to any Employee any sums due in
respect of the period prior to Completion
9.3.4 any claim by any trade union staff association or staff body
recognised by the Vendor in respect of all or any of the
Employees arising out of the Vendor's failure to comply with
its legal obligations to such trade unions or staff
associations or bodies
9.4 The Purchaser assuming the outstanding obligations of the Vendor in
respect of the accrued holiday entitlements and accrued holiday
remuneration of the Employees to the Effective Date; the full amount
necessary to enable the Purchaser to meet the cost of providing such
holiday entitlements and remuneration as at the Effective Date shall
be treated as a Creditor in the Completion Accounts.
9.5 In consideration of the sum of (Pounds)1,000 the Vendor shall (as
agent for the Purchaser) put in place such arrangements as are
necessary to ensure that the Employees are paid all amounts due to
them in respect of the month of December and shall make all necessary
deductions therefrom and account for same to the Inland Revenue and
/or the Contributions Agency as appropriate.
9.6 The provisions of Schedule 5 shall have effect in relation to the
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pension entitlement of the Employees
10 CREDITORS AND DEBTORS
10.1 The Purchaser hereby acknowledges its responsibility for the
Creditors, undertakes to pay the Creditors in accordance with the
appropriate terms and conditions of supply and agrees to indemnify the
Vendor fully at all times from and against any and all claims actions
proceedings demands liabilities costs and expenses in connection with
any of the Creditors. Provided always that such
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indemnity shall not apply in circumstances where the Purchaser has a
claim against the Vendor in respect of clause 11 herein.
10.2 If it becomes apparent that recovery of any of the Book Debts is not
likely to be possible unless legal proceedings are instituted, the
Purchaser will notify the Vendor in writing and furnish the Vendor
with full particulars of the steps taken by the Purchaser to effect
recovery. The Purchaser shall have the option (within 90 days of such
notification):-
10.2.1 to assign the relevant Book Debt(s) (by assignment in the
form of the agreed draft) to the Vendor against payment by
the Vendor to the Purchaser of the full nominal amount
thereof;
10.2.2 to issue court proceedings against the debtor in question
and require the Vendor to lend its name to such proceedings
(if necessary to the extent that the proceedings are taken
solely in the Vendor's name). The Vendor shall indemnify the
Purchaser against all reasonable costs (including legal
costs) of any such proceedings and shall account to the
Purchaser for the total of any amount recovered from the
debtor in question; or
10.2.3 to require the Vendor to complete an assignment of the
relevant Book Debt(s) (by assignment in the form of the
agreed draft) to the Purchaser and do such acts and things
and execute such deeds and documents as may be necessary
fully and effectively to vest in the Purchaser the relevant
Book Debt(s). In the event that it is subsequently necessary
for the Purchaser to bring court proceedings to recover the
relevant Book Debt(s) the Vendor shall indemnify the
Purchaser against all reasonable costs (including legal
costs and any stamp duty payable on such assignment)
incurred by the Purchaser in the recovery of such relevant
Book Debt(s)
10.3 In the event that the Vendor receives any sums after the Effective
Date from any of the debtors who are included in the Book Debts then
the Vendor shall receive
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the same as trustee shall record such payment separately in its books
and shall account to the Purchaser for the same on Completion or if
received thereafter within 7 days of receipt.
11 WARRANTIES
11.1 The Vendor acknowledges that it has made representations to the
Purchaser as set out in Schedule 2.
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11.2 The Vendor warrants to the Purchaser, and to any successors in title
or assignees of the Purchaser, in the terms set out in Schedule 2.
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11.3 The Indemnities and Warranties set forth in this Agreement (including
without prejudice to the generality hereof the Warranties in Schedule
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2) are subject to the matters expressly described in the Disclosure
-
Letter and to the general provisions and restrictions in this
Agreement set forth (including, without limitation, the limitations
set out at Schedule 10) but to no other qualification whatsoever.
11.4 The rights and remedies of the Purchaser in respect of a breach of the
Warranties shall not be affected by the completion of this Agreement
by any investigation made by or on behalf of the Purchaser into the
affairs of the Business by the Purchaser rescinding or failing to
rescind this Agreement or by any other event or matter whatsoever
except a specific written waiver or release by the Purchaser.
11.5 Without prejudice to any other remedy which may be available to the
Purchaser the Vendor hereby further undertakes to the Purchaser to
indemnify and keep indemnified the Purchaser against all and any
costs, damages or expenses suffered or incurred by the Purchaser as a
result of or in connection with any breach or non-fulfilment of any of
the Warranties or other undertakings referred to or contained in this
agreement and all costs, claims and expenses incurred in making or
defining a claim in relation to facts or circumstances which
constituted or would, if proved, constitute such a breach.
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12 APPORTIONMENTS/PREPAYMENTS
12.1 All periodical charges and outgoings of the Business including but not
limited to salaries wages rent rates gas electricity water telephone
charges licence fees and royalties shall be apportioned on a time
basis so that such part of the relevant charges attributable to the
period ended on the Effective Date shall be borne by the Vendor and to
the extent not paid at the Effective Date treated as Creditors in the
Completion Accounts. Such part of the relevant charges attributable to
the period commencing on the day following the Effective Date shall be
borne by the Purchaser. All rents licence fees royalties and other
similar sums receivable in respect of the Business shall be
apportioned between the Vendor and the Purchaser on like terms.
12.2 Prepayments and payments in advance made to the Vendor on or before
the Effective Date in respect of goods or services to be supplied by
the Purchaser after the Effective Date shall be treated as Creditors
in the Completion Accounts and prepayments and payments in advance
made by the Vendor in respect of goods ordered but not delivered and
services contracted for but not rendered to the Vendor in connection
with the Business prior to the Effective Date shall be treated as
Debtors in the Completion Accounts.
13 CONTRACTS
13.1 The Purchaser agrees with the Vendor with effect from the Effective
Date to assume the obligations of and become entitled to the benefits
of the Vendor under the Contracts (subject to the Vendor indemnifying
the Purchaser and keeping it fully indemnified against all liabilities
losses actions proceedings costs claims demands and expenses brought
or made against or incurred by the Purchaser in respect of the non-
performance or defective or negligent performance by the Vendor of the
Contracts in the period up to and including Completion) and the
Purchaser shall, from Completion, carry out perform and complete all
the
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obligations and liabilities created by or arising under the Contracts
(except for any obligations or liabilities attributable to a breach on
the part of the Vendor or its employees agents or sub-contractors) and
shall indemnify the Vendor and keep it fully indemnified against all
liabilities losses actions proceedings costs claims demands and
expenses brought or made against or incurred by the Vendor in respect
of the non-performance or defective or negligent performance by the
Purchaser of the Contracts.
13.2 The Vendor shall on Completion and with effect from the Effective
Date assign to the order of the Purchaser or procure the assignment to
the order of the Purchaser of all Contracts which are capable of
assignment without the consent of other parties.
13.3 In so far as any of the Contracts are not assignable to the Purchaser
without the agreement of or novation by or consent to the assignment
from another party this agreement shall not constitute an assignment
or attempted assignment if such assignment or attempted assignment
would constitute a breach of the same. In the event that consent or
novation is required to such assignment:
13.3.1 the Vendor shall use its best endeavours (which for the
avoidance of doubt shall include the payment of any premium
required from such other party) with the co-operation of the
Purchaser to procure such novation or assignment as aforesaid;
13.3.2 unless and until any such Contract shall be novated or
assigned as aforesaid the Vendor shall hold the same in trust
for the Purchaser and its successors in title to the Business
absolutely and the Purchaser shall (if such sub-contracting is
permissible and lawful under the Contract in question) as the
Vendor's sub-contractor perform all the obligations of the
Vendor under such Contract;
13.3.3 unless and until any such Contract shall be novated or
assigned the Vendor will (so far as lawfully may) give all
such assistance to the Purchaser and as the Purchaser may
reasonably require to enable the Purchaser to enforce its
rights under such Contract and (without
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limitation) will provide access to all relevant books
documents and other information in relation to such Contract
as the Purchaser may require from time to time.
13.4 If such consent or novation is not obtained the Vendor will in co-
operation with the Purchaser use its best endeavours to make
arrangements to provide for the Purchaser the benefits under any of
the Contracts including enforcement for the account of the Purchaser
of any and all rights of the Vendor against the other party to the
Contract arising out of any cancellation by such other party or
otherwise. If and to the extent that in respect of such Contracts any
such arrangements cannot be made neither the Vendor nor the Purchaser
shall without prejudice to clause 13.1 have any further obligation to
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the other.
13.5 To the extent that any payment is made to the Vendor in respect of
the Contracts on or after the Effective Date the Vendor shall receive
the same as trustee shall record such payment separately in its books
and shall account to the Purchaser for the same on Completion or if
received thereafter within 7 days of receipt.
14 LEASED PLANT AND EQUIPMENT
14.1 The parties shall as soon as possible after Completion and in any
event within 14 days of Completion jointly apply in writing to the
lessors named in Schedule 8 requesting the transfer of the Hire/Lease
----------
Agreements to the Purchaser for the remainder of their respective
terms with effect from Completion.
14.2 If any such application as referred to in clause 14.1 shall be refused
-----------
or not granted the Vendor shall as agent for the Purchaser subject to
being fully indemnified by the Purchaser in respect of the relevant
Hire/Lease Agreement perform all the obligations on the part of the
Vendor to be performed under such Hire/Lease Agreement and shall
account to the Purchaser for all money benefits rights or privileges
received under such Hire/Lease Agreement.
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15 VAT
15.1 The parties shall use all reasonable endeavours to procure that the
sale of the Business is deemed to be a transfer of a business as a
going concern for the purposes of the Value Added Tax Act 1994 s 49
and Article 5 of the VAT (Special Provisions) Order 1992. In the
event that value added tax is or becomes payable in respect of any of
the Assets, the Purchaser shall in addition to the consideration pay
to the Vendor the full amount of such value added tax. The Vendor
shall issue to the Purchaser tax invoices in respect of such items and
payment of such invoices shall be made within 14 days of their issue.
15.2 The Vendor shall forthwith deliver to the Purchaser all the records of
the Business for value added tax purposes which are required by the
Value Added Tax Act 1994 s 49 to be preserved by the Purchaser.
15.3 The Purchaser shall for a period of not less than 6 years from the
Effective Date preserve the records delivered to it by the Vendor and,
upon reasonable notice during normal business hours, make them
available to the Vendor or its agents.
16 INSURANCE
16.1 The Vendor undertakes to the Purchaser that it will notify the
interest of the Purchaser to the relevant insurers and keep in force
its existing insurance policies, in respect of the Assets until
Completion, the Purchaser paying the proportion of the insurance
premiums from the Effective Date until the cancellation of the
relevant policies.
17 GUARANTEE
17.1 In consideration of the Purchaser entering into this Agreement with
the Vendor at the request of the Guarantor, the Guarantor
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17.1.1 hereby covenants with the Purchaser that the Vendor shall pay
all sums hereby agreed to be paid by the Vendor on the days
and in manner aforesaid and shall duly perform and observe all
the undertakings hereinbefore contained on the part of the
Vendor and that in case of default in such payment or
performance or observance of undertakings as aforesaid the
Guarantor will pay and make good to the Purchaser on demand
all loss damage costs and expenses thereby arising or incurred
by the Purchaser
17.2 This guarantee is a continuing guarantee and will remain in full force
and effect so long as any sums remain due by the Vendor to the
Purchaser.
17.3 Any settlement or discharge in whole or in part by the Purchaser of
the Guarantor's obligations under this guarantee will be deemed to be
given or made on condition that it will be of no effect as a
settlement or discharge if the assurance security or payment on the
faith of which it was made is afterwards avoided by virtue of any
provision or enactment for the time being in force relating to
bankruptcy insolvency or liquidation so that at any time after such
avoidance the Purchaser will be entitled to exercise its rights under
this guarantee as if no such settlement or discharge has been made.
17.4 The obligations of the Guarantor under this guarantee will not be
discharged impaired or otherwise affected by any omission matter or
thing which but for this provision would or might operate to release
or otherwise exonerate the Guarantor from such obligations or to
diminish such obligations including without limitation and whether or
not known to the Purchaser:-
17.4.1 any time or other indulgence given or agreed to be given to or
composition with the Vendor or any other person or
17.4.2 the taking variation compromise renewal or release of or
refusal or neglect to perfect or enforce any right remedies or
securities against
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the Vendor or any other person or
17.4.3 any litigation legal disability incapacity or other
circumstances relating to the Vendor or any other person or
any document or security or
17.4.4 any irregularity unenforceability or invalidity of any
obligations of the Vendor to the intent the Guarantor's
obligations under this guarantee will remain in full force and
be construed accordingly as if there were no such irregularity
unenforceabilty or invalidity.
17.5 Until all sums owing to the Purchaser by the Vendor under this
agreement have been paid in full and all of the Vendor's obligations
under it have been performed or satisfied the Guarantor will not after
a demand has been duly made by the Purchaser pursuant to this
guarantee:-
17.5.1 exercise as against the Vendor in respect of any amount
previously paid by it under this guarantee any right of
subrogation or any other right or remedy which it may have in
respect of the same or
17.5.2 claim payment of any other sums for the time being due to it
from the Vendor or exercise any other right or remedy which it
may have in respect of the same or
17.5.3 prove in liquidation of the Vendor in competition with the
Purchaser for any sums owing to it by the Vendor on any
account whatever.
17.6 The Purchaser may make one or more demands pursuant to this guarantee.
18 FURTHER ASSURANCE
18.1 The Vendor will do such acts and things and execute such deeds and
documents
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as may be necessary fully and effectively to vest in the Purchaser the
assets hereby agreed to be sold and to assure to the Purchaser the
rights hereby agreed to be granted.
18.2 In the event that any of the Assets purported to be transferred
hereunder is owned by another member of the Guarantor's Group, the
Guarantor undertakes to procure that such member does such acts and
things and executes such deeds and documents as may be necessary fully
and effectively to vest in the Purchaser the assets hereby agreed to
be sold and to assure to the Purchaser the rights hereby agreed to be
granted and the Guarantor shall fully and effectively indemnify the
Purchaser against all losses costs claims and demands arising in
respect of any breach or non-performance of the foregoing covenant.
19 SURVIVAL OF CERTAIN PROVISIONS
19.1 This Agreement shall remain in full force and effect after Completion
in respect of any matters covenants or conditions which shall not have
been done observed or performed prior thereto and all representations
warranties and obligations of the parties shall (except for any
obligations fully performed on Completion) continue in full force and
effect notwithstanding the completion of the sale and purchase hereby
agreed to be made.
20 ANNOUNCEMENTS
20.1 Except in respect of announcements required by law or the Stock
Exchange no announcement or circular relating to any matter referred
to in this Agreement shall be made or issued by or on behalf of the
Vendor or the Purchaser without the prior written approval of the
other, but such approval shall not be unreasonably withheld or
delayed.
21 ENTIRE AGREEMENT
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21.1 This Agreement, when taken together with the agreed drafts (or the
executed engrossments of them) constitutes the entire agreement and
understanding between the parties with respect to all matters therein
referred to.
21.2 No variation of this Agreement or any of the agreed drafts shall be
valid unless it is in writing and signed by or on behalf of each of
the parties.
22 WAIVER
22.1 The rights of either party shall not be prejudiced or restricted by
any indulgence or forbearance extended to the other party and no
waiver by any party in respect of any breach shall operate as a waiver
of any subsequent breach.
23 NOTICES
23.1 Any notice under this Agreement shall be in writing and signed by or
on behalf of the party giving it.
23.2 Any such notice may be served by leaving it or sending it by prepaid
recorded delivery or registered post -
23.2.1 in the case of the Vendor or the Guarantor, at or to the
offices of Messrs Johns Elliot Solicitors marked for the
attention of Mr Maurice Butler or any other address or
addresses in Northern Ireland which are notified in writing
to the Purchaser; or
23.2.2 in the case of the Purchaser, at or to its registered office
for the time being marked for the attention of the Company
Secretary of the Purchaser.
23.3 Any notice so served by post shall (unless the contrary is proved) be
deemed to have been served 48 hours from the time of posting and in
proving such service it shall be sufficient to prove that the notice
was properly addressed and was posted in accordance with sub-clause
23.2 above.
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24 MISCELLANEOUS
24.1 This Agreement shall be binding upon each party's successors and
assigns and personal representatives (as the case may be).
24.2 This Agreement is personal to the parties and may not be assigned or
disposed of by any of them.
24.3 The parties will pay their own costs of and incidental to this
agreement.
25 COUNTERPARTS
25.1 This Agreement may be executed in one or more counterparts and when a
counterpart has been executed by each party hereto all such
counterparts taken together shall for all purposes constitute one and
the same Agreement binding on all of the parties hereto.
26 INVALIDITY
26.1 If at any time any one or more of the provisions of this Agreement or
any part thereof is or becomes invalid illegal or unenforceable in any
respect under any law the validity, legality and enforceability of the
remaining provisions of this Agreement shall not in any way be
affected or impaired thereby.
27 LAW AND JURISDICTION
27.1 This Agreement shall be governed by and construed in accordance with
the laws of Northern Ireland and the parties submit to the non
exclusive jurisdiction of the Courts of Northern Ireland.
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IN WITNESS whereof Steve A. Haffer on behalf of the Vendor,
and on behalf of the Purchaser have hereunto set
their hands the day and year first before WRITTEN.
/s/ S. A. Haffer, Chairman
SIGNED by Steve A. Haffer :
for and on behalf of AURORA UNICOMP :
LIMITED in the presence of:- :
/s/ Maurice R. Butler :
Solicitor :
Belfast
:
:
:
:
SIGNED by :
for and on behalf of AURORA SX3 : /s/ Nigel D. Wilson
LIMITED in the presence of:- :
/s/ M. C. Johnson /s/ Noreen Wright
Solicitor :
Belfast :
:
:
Executed as a Deed by UNICOMP INC in the :/s/ S. A. Haffer, Chairman & CEO
presence of:- :
/s/ Maurice R. Butler
Solicitor :
Belfast :
:
:
:
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SCHEDULE 1
PREMISES
1. ICS Computing Ltd
Hydepark
Mallusk
Newtownabbey
Co Antrim
Lease dated 1 January 1990 between R S McKinney Ltd and Software Ireland
Ltd. Term 20 years from 1 January 1990.
2. Unit 30 Office
Northland Road
Industrial Estate
Londonderry
Lease dated 1 October 1997 between Templemore Properties Ltd and Aurora
Uniomp Ltd. Term 3 years from 3 September 1997.
3. Unit 4 Warehouse
West Bank Drive
Belfast
Lease dated 30 May 1997 between Thomas George Eakin and Violet Pattison
Eakin and CEM Computers Ltd. Term 17 years, 7 months, 7 days from 20 March
1995.
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SCHEDULE 2
WARRANTIES
INTERPRETATION
1. In this Schedule -
(a) the following additional definitions are used -
"THE AGREEMENT" means the Agreement to which this is a schedule.
"COMPANIES ORDERS" means the Companies (Northern Ireland) Order 1986
as amended by any subsequent legislation including without prejudice
to the generality of the foregoing the Companies (Northern Ireland)
Orders 1989, 1990 and 1990 (No. 2) and the Insolvency (Northern
Ireland) Order 1989;
"THE COMPUTER EQUIPMENT" means all computer equipment owned in respect
of, or used in, the Business (including without limitation all
hardware, data storage devices, printers, VDUs, keyboards, the
Software, network cabling and equipment and all other peripherals);
"ENVIRONMENTAL LEGISLATION" means all national or local or other laws
or legislation concerning health safety or matters related to
pollution or protection of the environment and all decisions rules
regulations ordinances orders notices and directives of the European
Community the United Kingdom Parliament and other official bodies
having jurisdiction in respect of such matters;
"ENVIRONMENTAL AUTHORISATIONS" means any permits consents
authorisations approvals required by Vendor under the Environmental
Legislation;
"INTELLECTUAL PROPERTY RIGHTS" means any patent, patent application,
know-how, trademark, trademark application, trade name, registered
design, copyright or other similar industrial or commercial right;
"THE PENSION SCHEMES" means the UniComp Final Salary Scheme and the
UniComp Group Personal Pension.
"SOFTWARE" means any form of computer program owned in respect of or
used in, the Business (including without limit applications and
operating systems and in each case whether in source, object or
machine code form);
"YEAR 2000 READY" shall mean that neither performance nor
functionality is affected by dates prior to, during and after the Year
2000, and in particular:-
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(i) no value for current date will cause any interruption in
operation
(ii) date based functionality must behave consistently for dates
before, during and after the Year 2000
(iii) in all interfaces and data storage, the century in any date is
specified either explicitly or by unambiguous algorithms or
inferencing rules; and
(iv) Year 2000 must be recognised as a leap year.
(b) a reference to a balance sheet or profit and loss account includes a
reference to any note forming part of it;
(c) where any of the Warranties is qualified by the expression "to the
best of the knowledge information and belief of the Vendor" or "so far
as the Vendor is aware" or any similar expression, that Warranty is
deemed to include an additional statement that it has been made after
due, diligent and careful enquiry and that the Vendor has used its
best endeavours to ensure that all information given in the Warranty
is true, complete and accurate in all respects;
(d) except as otherwise expressly provided in this Schedule, each of the
Warranties is to be construed independently of the others and is not
limited by reference to any of the others.
GIVING OF WARRANTIES
2. The Vendor warrants and represents to the Purchaser as follows -
ACCOUNTS
GENERAL
(1) the Accounts (copies of which have been delivered to the Purchaser) -
(a) have been prepared under the historical cost convention and in
accordance with good accounting practice including all applicable
Statements of Standard Accounting Practice and Financial Reporting
Standards;
(b) show a true and fair view of the affairs of the Business as at the
Accounts Date and of the results of the Business for the accounting
period ended on that date;
(c) comply with the requirements of the Companies Orders and other
relevant statutes;
PROVISION FOR LIABILITIES ETC
(2) the Accounts make full provision or reserve for, or disclose, all
liabilities (including contingent and disputed liabilities) and all capital
commitments of the Vendor in relation
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to the Business as at the Accounts Date, indicate clearly which of those
liabilities are not usually provided for or reserved, and make adequate
provision or reserve for all bad and doubtful debts;
VALUATION OF STOCK
(3) in the Accounts any slow moving stock has been written down appropriately,
all redundant or obsolete stock has been wholly written off, and the value
attributed to the remaining stock does not exceed the lower of cost or net
realisable value at the Accounts Date;
PROFITS
(4) the profits shown in the Accounts have not to a material extent been
affected (except as disclosed in those accounts) by any extraordinary or
exceptional event or circumstance or by any other factor rendering them
unusually high or low;
MANAGEMENT ACCOUNTS
(5) the management accounts of the Vendor for the period from the Accounts Date
until 31st October 1998 have been prepared in accordance with generally
accepted accounting principles and reflect the state of affairs of the
Business in all respects and the profits/losses of the Business during the
period to which they relate and adequately disclose all assets and
liabilities of the Business at the relevant balance sheet date to which
they relate and apply bases and policies of accounting which have been
consistently applied in the Accounts save that such management accounts
have not been audited by the Auditors
POSITION SINCE ACCOUNTS DATE
(6) save as disclosed in the Disclosure Letter since the Accounts Date -
(a) the Business has been carried on in the ordinary course and so as to
maintain it as a going concern;
(b) there has been no material adverse change in the financial or trading
position or prospects of the Vendor in relation to the Business;
(c) there has been no reduction in the value of the Assets on the basis
of the valuations adopted in the Accounts;
(d) the Business has not been materially and adversely affected by the
loss of any important customer or source of supply or by any normal
factor not affecting similar businesses to a similar extent and the
Vendor is not aware of any facts
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likely to give rise to any such effect whether before or after
Completion;
PREMISES
INTERESTS
(7) the Premises comprise all the land and buildings occupied by the Vendor in
relation to the Business or used or occupied by it or in which it has any
other interest;
TITLE
(8) in the case of each of the Premises -
(a) the Vendor has a good marketable and unassailable title to the
property and has in its possession or under its control all relevant
deeds and documents;
(b) those of the Premises which are occupied or otherwise used by the
Vendor in connection with the Business are occupied or used by right
of ownership or under lease or licence, the terms of which permit the
occupation or use;
(c) the Vendor is the legal and beneficial owner of the Premises;
(d) the information contained in Schedule 1 as to the tenure of each of
----------
the Premises, the principal terms of the leases or licences held by
the Vendor and the principal terms of the tenancies and licences
subject to and with the benefit of which the Premises are held is
accurate in all respects;
ENCUMBRANCES
(9) (a) in the case of each of the Premises the Vendor is in possession of,
owns, uses and occupies the property free from any mortgage or
charge, licence, rent, charge, overriding interest, lien, lease,
underlease, tenancy, right, covenant, limitation, restriction,
option, right of pre-emption, easement exception or reservation or
other agreement or arrangement affecting the property;
(b) the Vendor does not by its use or occupation contravene any
requirement or restriction having the force of law and has complied
with all covenants, conditions, restrictions and limitations binding
on it or on the property, none of which is of an unusual or onerous
nature or prejudicially affects the property or the Vendor's use,
occupation or powers of disposal of it;
(c) the Premises are not subject to any outgoings other than business
rates, water rates and insurance premiums and in the case of
leasehold properties rent and service charges;
(d) the Premises are not subject to any restrictive covenants,
stipulations,
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easements, profits a' prendre, wayleaves, licences, grants,
restrictions, overriding interests or other similar rights vested in
third parties;
(e) where any of the matters referred to in clauses (a) (b) (c) and (d)
have been disclosed in the Disclosure Letter, the obligations and
liabilities imposed and arising under them have been fully observed
and performed and any payments in respect of them due and payable
have been duly paid;
(f) the Premises are not subject to any option, right of pre-emption or
right of first refusal;
OTHER INVOLVEMENT IN RELATION TO PROPERTY
(10) the Vendor has not at any time in the last three years carried on the
Business from any premises other than the Premises;
OTHER MATTERS AFFECTING PREMISES LISTED
(11) none of the Premises is affected by any of the following matters -
(a) any actual or contingent liability to repay the whole or any part of
any compensation received or receivable in consequence of the
imposition of any restriction, limitation or condition on the grant
of planning permission or of any refusal, modification or revocation
of planning permission (whether the permission was granted or refused
in pursuance of an application or was granted in pursuance of a
general development order);
(b) any agreement with any planning authority regulating use or
development;
(c) any surcharge imposed under Section 17A of the General Rate Act 1967;
(d) none of the Premises is listed as being of special historic or
architectural importance or located in a conservation area;
(e) there are not in force or required to be in force any licences
whether under licensing legislation or otherwise which apply to any
of the Premises;
DEVELOPMENT AND USE
(12) all developments and uses of the Premises comply with all planning and
other legislation, regulations, orders and bye-laws and no permission,
consent or approval of whatever nature on which the actual use and
occupation of any of those properties or the lawful implementation of any
works carried out or being carried out to any of them is dependent has been
suspended or is liable to terminate or is restricted to a particular person
and all conditions imposed by any permission consent or approval have been
complied with;
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CONDITION OF THE PREMISES
(13) (a) there are no disputes concerning boundaries, easements, covenants,
means of access or other matters relating to any of the Premises or
their use;
(b) the principal means of access to the Premises is over roads which
have been taken over by the local or other highway authority and
which are maintainable at the public expense and no means of access
to the Premises is shared with any other party nor subject to rights
of determination by any other party;
(c) the buildings and other structures on the Premises are in good and
substantial repair and fit for the purposes for which they are used;
(d) each of the Premises enjoys the main services of water, drainage,
electricity and gas;
(e) none of the Premises is located in an area or subject to
circumstances particularly susceptible to flooding;
(f) no mining operations have been or are contemplated under any of the
Premises;
INSURANCE OF PREMISES
(14) (a) the Premises are insured in their respective full reinstatement
values and against third party and public liabilities to an adequate
extent;
(b) all premiums payable in respect of insurance policies with respect to
the Premises which have become due have been duly paid and no
circumstances have arisen which would vitiate or permit the insurers
to avoid such policies;
(c) the information in the Disclosure Letter with respect to the
insurance policies is up to date and true and accurate in all
material respects;
STATUTORY OBLIGATIONS
(15) (a) the Vendor has complied and is complying with all applicable
statutory and by-law requirements with respect to the Premises, and
in particular (but without limitation) with the requirements as to
fire precautions and under the Factories Act l96l, The Public Health
Acts l875-1961, the Offices, Shops and Railway Premises Act 1963, the
Control of Pollution Act 1974 and the Health and Safety at Work etc
Act l974;
(b) there is no outstanding and unobserved or unperformed obligation with
respect to the Premises necessary to comply with the requirements
(whether formal or informal) of any competent authority exercising
statutory or delegated powers;
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(c) no licences are required whether under the Licensing Act 1988 or
otherwise in relation to any of the Premises;
ADVERSE ORDERS
(16) (a) there are no compulsory purchase notices, orders or resolutions
affecting any of the Premises and there are no circumstances likely
to lead to any being made;
(b) there are no closing, demolition or clearance orders, enforcement
notices or stop notices affecting the Premises and there are no
circumstances likely to lead to any being made;
(c) no notices, orders, proposals, applications, requests or schedules of
dilapidations affecting or relating to any of the Premises have been
served or made by any authority or other person or by the Vendor, and
there are no circumstances which are likely to result in any being
served or made;
LEASEHOLD PROPERTIES
(17) (a) the Vendor has paid the rent and observed and performed the covenants
on the part of the tenant and the conditions contained in any leases
(which expressions in this Warranty (17) includes underleases) under
--------
which the Premises are held, and the last demand (or receipts for
rent if issued) were unqualified, and all the leases are valid and in
full force;
(b) all licences, consents and approvals required from the landlords and
any superior landlords under any leases of the Premises have been
obtained and the covenants on the part of the tenant contained in the
licences, consents and approvals have been duly performed and
observed;
(c) there are no rent reviews under the leases of the Premises held by
the Vendor in progress;
(d) no obligation necessary to comply with any notice or other
requirement given by the landlord under any leases of the Premises is
outstanding and unobserved or unperformed;
(e) there is no obligation to reinstate any of the Premises by removing
or dismantling any alteration made to it by the Vendor or any
predecessors in title to the Vendor;
TENANCIES
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(18) the Premises are not held subject to or with the benefit of any tenancies
(which expression in this Warranty (18) includes subtenancies);
--------
POLLUTION
(19) to the best of the Vendor's belief none of the Premises is likely to be
entered in a register, introduced under the Environmental Protection Act
1990, as land which may be contaminated;
OTHER ASSETS
TITLE
(20) the Assets are the absolute property of the Vendor free from any mortgage,
charge, lien, bill of sale or other encumbrance and are not the subject of
any leasing, hiring or hire-purchase agreement or agreement for payment on
deferred terms or assignment or factoring or other similar agreement, and
all such assets are in the possession or under the control of the Vendor;
CONDITION OF PLANT ETC
(21) the Plant and Equipment are in a good state of repair, have been regularly
and properly maintained and comply with any applicable legal requirement or
restriction, and the vehicles are fully licensed and suitable for the
purposes for which they are used;
CONTROL OF RECORDS ETC
(22) (a) all records and information belonging to the Vendor in relation to
the Business are in its exclusive possession, under its direct
control and subject to unrestricted access by it;
(b) proper books of account have been maintained by the Vendor recording
all sums of money received and expended by the Vendor and the matters
in respect of which the receipt and expenditure takes place, all
sales and purchases of goods of the Vendor and the assets and
liabilities of the Vendor including without prejudice to the
generality of the foregoing all contingent liabilities;
ASSETS SUFFICIENT FOR THE BUSINESS
(23) (a) the Assets comprise all assets now used in the Business and which are
necessary for the continuation of the Business as now carried on;
(b) the Stocks are sufficient for the normal requirements of the
Business;
(c) the work-in-progress included in the Stocks is at its normal level
having regard
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to current orders included in the Contracts and to orders reasonably
anticipated from customers of the Business;
(d) the stocks of raw materials, packaging materials and finished goods
included in the Stocks are not excessive and are adequate in relation
to the current trading requirements of the Business;
STOCKS
(24) (a) the Stocks are of merchantable quality and saleable at normal selling
prices;
(b) none of the Stocks is obsolete, unusable, unmarketable or
inappropriate or of limited value in relation to the Business and
none of the Contracts is likely to result in this being untrue;
DOCUMENTS STAMPED
(25) all documents which in any way affect the right, title or interest of the
Vendor in or to any of the Assets and which attract stamp duty have been
duly stamped within the requisite period for stamping;
REALISATION OF BOOK DEBTS
(26) the Book Debts will realise their full amount within three months of
Completion;
INTELLECTUAL PROPERTY RIGHTS
INTERESTS
(27) other than the Know-How the Vendor -
(a) has no interest in any Intellectual Property Rights and has not
entered into any agreement for -
(i) the licensing or use of any Intellectual Property Rights; or
(ii) the provision or acquisition of know-how or technical
information or assistance; or
(iii) the prohibition or restriction of the disclosure of any know-
how or technical information;
(b) does not require any Intellectual Property Rights, or any licence to
use any Intellectual Property Rights, for any of the operations of
the Business;
INFRINGEMENTS ETC
(28) none of the operations carried on by the Vendor in relation to the Business
infringe any rights of another person in respect of any Intellectual
Property Rights or will or may give rise to payment by the Vendor of any
royalty or of any sum in the nature of a royalty or
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to liability to pay compensation pursuant to any applicable legislation;
CONFIDENTIALITY
(29) the Vendor has not disclosed or permitted to be disclosed or undertaken or
arranged to disclose to any person any of its know-how, secrets,
confidential information or lists of customers or suppliers;
COMPUTER EQUIPMENT AND SOFTWARE
DETAILS
(30) Full details of all Software the Intellectual Property Rights in which are
owned by a third party but one or more copies of which are held by the
Vendor in respect of the Business or used in the Business are set out in
the Disclosure Letter and accurate copies of all licences, maintenance
agreements, escrow agreements and (where the warranties have not expired)
development agreements in respect of that Software are attached to the
Disclosure Letter where such licences or agreements are in written form.
Where any such licences or agreements are not in written form this is made
clear in the Disclosure Letter and the licences or agreements are for the
full period of the copyright in the Software concerned and include no
restriction on copying, use or transfer of that Software. The licences of
that Software are complied with in all material respects in the operation
of the Business and any restrictions in those licences do not adversely
effect the present conduct of the Business.
OWNERSHIP
(31) All Intellectual Property Rights in all Software used in the Business
except that referred to in warranty (30) are owned by the Vendor and form
-------------
part of the Assets. Neither the Vendor nor any of its directors, employees,
agents, ex-directors, ex-employees or consultants or ex-consultants has
granted or purported to grant any right to use, or supplied any such
Software to, any third party or put or agreed to put the source code of
such Software into escrow.
ESCROW
(32) All of the Software referred to in warranty (30) is the subject of escrow
-------------
agreements which provide that, at least, the source code, flow charts and
programmers' notes related to the relevant Software (as modified and
updated from time to time) will be made available to the Vendor if the
relevant licensor:-
(a) enters into administration or becomes insolvent in any way;
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(b) fails to maintain the Software concerned to a reasonable level; or
(c) assigns its rights in the Software without procuring that the
assignee enters an escrow agreement on terms no less favourable to
the Vendor.
MAINTENANCE AGREEMENTS
(33) Full details of all maintenance agreements in place in respect of the
Computer Equipment currently used in the Business are set out in the
Disclosure Letter and accurate copies are attached to the Disclosure
Letter. The maintenance providers concerned have always fulfilled their
obligations under those agreements currently in force in accordance with
their terms (and those terms provide for the Software concerned to be
updated, free of charge, to correct errors and amended to reflect changes
in the law which impact on the Software).
DISASTER RECOVERY PLAN
(34) The Business has a disaster recovery plan in respect of damage to or
destruction of some or all of the Computer Equipment which is prudent and
would permit all of the Business's critical functions which are run on the
Computer Equipment to be restored within 24 hours, the balance of functions
being restored within 48 hours. The Business has tested that disaster
recovery plan in the last twelve months and that test resulted in full
restoration of those functions within those time scales.
SECURITY
(35) The Vendor has prudent procedures in place to ensure the security of the
Computer Equipment and data stored on it (including without limit by use of
properly administered and run password protection, data encryption, virus
checking software and procedures for taking and storing on site (at least
one every 12 hours) and off site (at least once every 24 hours) back up
copies of the Software and all data stored on the Computer Equipment).
PERFORMANCE
(36 The Computer Equipment (and each part of it) has run and functioned
consistently and accurately since it was installed (except for pre-planned
maintenance shut downs). The Computer Equipment is not connected (and has
not been connected) to any computer or communications network.
(37) Each item of Computer Equipment and the Computer Equipment as a whole
functions and performs (in terms of speed of processing) at least as well
as was required by the
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warranty obtained when it was acquired and at least as well as the
documentation describing it and referred to in Warranty (39) states. The
-------------
data storage capability, functionality and performance of each item of
Computer Equipment and the Computer Equipment as a whole is wholly
satisfactory for the Business.
OPERATIVES
(38) The Employees include a sufficient number of persons who are sufficiently
technically competent and appropriately trained to ensure the proper
operation and use of the Computer Equipment as it is used at the Effective
Date.
DOCUMENTATION
(39) The Computer Equipment and the methods of operation of the Computer
Equipment are comprehensively and clearly documented and are sufficient to
allow a reasonably skilled computer engineer to operate the Computer
Equipment. That documentation forms part of the Records.
OUTSIDE SERVICES
(40) The Vendor is not a party to a facilities management agreement (whether as
a provider or a recipient of services) nor is the Vendor a subscriber to or
provider of bureau, out sourcing or similar services.
YEAR 2000 READY
(41) (a) all computer systems and other systems on which the Vendor may rely
which are controlled wholly or in part by computer hardware, software
or embedded chip technology are either Year 2000 Ready or are covered
by subparagraph (b);
(b) the Vendor has developed an action plan to effect any remedial action
necessary so that any such systems which are not presently Year 2000
Ready will be Year 2000 Ready by not later than 31 December 1999, or
will be no longer required and so not in use by 31st December 1999;
(c) all components, hardware and software purchased or licensed by the
Vendor or to which it is given access are Year 2000 Ready.
(d) the Vendor has not given any advices or support to any third party in
which the Vendor has undertaken to ensure that such third party's
computer systems and other systems on which such third party may rely
which are controlled wholly or in part by computer hardware, software
or embedded chip technology are Year 2000 Ready;
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LIABILITIES ETC
GRANTS AND SUBSIDIES
(42) the Vendor has not done or agreed to do anything as a result of which any
investment grant or other grant or any subsidy received by the Vendor in
relation to any of the Assets is or may be liable to be refunded wholly or
partly and neither the signature nor the performance of this Agreement will
have any such result;
GRANTS
(43) the Disclosure Letter contains details of all grants awarded to the Vendor
in respect of which there remains an obligation or contingent obligation to
repay all or part thereof and summarises the circumstances in which the
same may become repayable, and gives details of all grants receivable but
not yet paid or which have been offered but not yet accepted by the Vendor;
COMMERCIAL ARRANGEMENTS
MATERIAL CONTRACTS ETC
(44) none of the Contracts -
(a) is incapable of complete performance within six months from the date
of the Agreement; or
(b) has not been incurred in the ordinary course of business; or
(c) is, or is likely to be, of major significance to the Business; or
(d) will be incapable of termination in accordance with its terms by the
Purchaser on sixty days notice or less; or
(e) is of a loss making nature (that is to say known to have been likely
to result in a loss to the Vendor on Completion of performance if the
Vendor had not sold the Business); or
(f) will not be capable of being readily fulfilled or performed by the
Purchaser on time without undue or unusual expenditure of money or
personnel; or
(g) will not involve payment by the Purchaser by reference to
fluctuations in the Index of Retail Prices or any other Index;
MAINTENANCE CONTRACTS
(45) In respect of the Maintenance Contracts the Vendor states:-
(a) that all such Maintenance Contracts as listed are existing at
Completion Date.
(b) that all such Maintenance Contracts are in Vendor's standard form.
<PAGE>
(c) that the Vendor has no notice of any customer's intention to
terminate any of the Maintenance Contracts.
(d) that the Vendor is not aware of any reason as to why any customer
would be entitled to terminate any of the Maintenance Contracts.
(e) that all such Maintenance Contracts are assignable save as disclosed
in the Disclosure Letter.
(f) that all such Maintenance Contracts have been performed by the
Vendor up to and including the date of Completion.
EFFECT OF AGREEMENT ON OTHER AGREEMENTS ETC
(46) none of the Contracts will or may be terminated as a result of the
Agreement or will be affected materially by it or includes any provision
with respect to a change in the control, management or shareholders of the
Vendor;
COMMERCIAL POSITION
(47) so far as the Vendor is aware -
(a) there is no substantial customer or supplier of the Vendor in
relation to the Business who has ceased purchasing from or supplying
to it or who is likely after the date of the Agreement to reduce
substantially or terminate purchases from or supplies to it;
(b) there are no special circumstances which might lead to the
manufacture by the Vendor of any goods, or the supply by or to it of
any goods or services, being restricted or hindered;
DEFECTIVE PRODUCTS AND SERVICE LIABILITIES
(48) (a) the Vendor has not manufactured or sold products or supplied any
services which were or are or will become in any material respect
faulty or defective or the subject of negligence claims or which did
not or do not comply in any material respect with any warranties or
representations expressly or impliedly made by the Vendor or with all
applicable regulations, standards and requirements;
(b) the Vendor has not accepted any liability or obligation outside its
standard terms and conditions of business (copies of which have been
supplied to the Purchaser's solicitors) to service, repair, maintain,
take back or otherwise do or not do anything in respect of any goods
or products that would apply after the
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goods or products have been delivered by it;
BUSINESS
LICENCES ETC
(49) all licences, permissions and consents required for the carrying on of the
Business have been obtained by the Vendor, are disclosed in the Disclosure
Letter and are in full force and effect and the Vendor is not aware of any
circumstances indicating that any of those licences, permissions or
consents is likely to be revoked or not renewed in the ordinary course;
ORDINARY ASPECTS OF CARRYING ON BUSINESS
(50) the Vendor -
(a) does not use on its stationery or vehicles or otherwise carry on
business under any name other than the Name;
(b) does not have any branch outside Northern Ireland or any permanent
establishment outside the United Kingdom;
(c) has complied in all material respects with all legal requirements
applicable to the Business, whether in the United Kingdom or in any
other country;
DATA PROTECTION
(51) (a) the Vendor in relation to the Business has duly complied with all
relevant requirements of the UK Data Protection Act 1984 including
compliance with the following:-
(i) the data protection principles established in the Act;
(ii) requests from data subjects for access to data held by it;
(iii) the requirements relating to the registration of data users;
(b) the Vendor has not received a notice or allegation from either the
data protection registrar or a data subject alleging non-compliance
with the data protection principles or prohibiting the transfer of
data to a place outside the United Kingdom;
(c) no individual has claimed or will have the right to claim
compensation from the Vendor under the Act, for loss or unauthorised
disclosures of data;
RESTRICTIVE PRACTICES
RESTRICTIVE AGREEMENTS ETC
(52) the Vendor is not and has not been a party in relation to the Business to
any agreement,
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practice or arrangement which in whole or in part -
(a) is, or requires to be registered under the Restrictive Trade
Practices Act 1976 or notified under or pursuant to Article 85 or 86
of the Treaty of Rome;
(b) contravenes any provision of that Act or the Treaty of Rome;
(c) restricts the freedom of the Vendor to provide and obtain goods and
services by such means as it may in its absolute discretion
determine;
CONSUMER TRADE, ANTI-COMPETITIVE AND OTHER PRACTICES
(53) (a) none of the practices of the Vendor is or has been the subject of,
susceptible to, or affected by, any investigation, reference, report
or order made under the Fair Trading Act 1973 or the Competition Act
1980 and no undertaking has been given by the Vendor pursuant to any
action taken under either of those Acts;
(b) the Vendor is not and has not been a party in relation to the
Business to any agreement, practice or arrangement which -
(i) contravenes the provisions of the Trades Descriptions Acts 1968
and 1972;
(ii) contravenes the provisions of the Consumer Credit Act 1974;
NOTICE OF OFFICIAL ACTION
(54) the Vendor has not received any process, notice or communication, formal or
informal, by or on behalf of the Office of Fair Trading, the Monopolies and
Mergers Commission, the Secretary of State, the European Commission or any
other authority of any country having jurisdiction in anti-trust matters,
in relation to any aspect of the business of the Vendor or any agreement or
arrangement to which the Vendor is or was, or is alleged to be or have
been, a party, and so far as the Vendor is aware the Vendor is not likely
to receive any such process, notice or communication;
LITIGATION AND OFFENCES
LEGAL PROCEEDINGS
(55) apart from normal debt collection, the Vendor is not engaged or proposing
to engage in any litigation, arbitration, prosecution or other legal
proceedings affecting the Business or the Assets, and there are no such
claims or actions (whether criminal or civil) in progress, outstanding,
pending or threatened against the Vendor;
UNLAWFUL ACTS ETC BY VENDOR
(56) neither the Vendor nor any of its officers or employees has by any act or
default
49
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committed -
(a) any criminal or unlawful act in connection with the business, other
than minor road traffic offences;
(b) any breach of trust in relation to the Business;
(c) any breach of contract or statutory duty or any tortious act
(including any act giving rise to product liability) which could
entitle any third party to terminate any Contract or could lead to a
claim against the Business for damages or an injunction;
DEFAULTS BY OTHERS
(57) no party with whom the Vendor has entered into any contract is in default
under it, and there are no circumstances likely to give rise to such
default;
INSURANCES
ADEQUACY OF COVER
(58) the Vendor has, and at all material times has had, valid insurance cover in
respect of the Business and Assets -
(a) against all risks (including product liability and loss of profits
for a period of at least six months) normally insured against by
businesses carrying on the same type of business as the Vendor or
having similar assets;
(b) for the full replacement value of its assets and for such amount in
respect of its business as would in the circumstances be prudent for
such a business;
(c) from a well established and reputable insurer;
POLICIES
(59) all policies of insurance taken out in connection with the Business or
Assets have been disclosed to the Purchaser, are written in the name of the
Vendor and are in full force and effect; and the Vendor has not done or
omitted to do or allowed anyone to do or not to do anything which might
render any of those policies void or voidable and has complied with all
conditions attached to them, and since the Accounts Date there has been no
change in the claims experience or safety record of the Vendor;
CLAIMS
(60) no claim under any policy of insurance taken out in connection with the
Business or Assets is outstanding and, so far as the Vendor is aware, there
are no circumstances likely to give rise to such a claim;
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EMPLOYEES
COMPLIANCE WITH REQUIREMENTS
(61) the Vendor has in relation to each of the Employees (and so far as relevant
to each of its former employees) -
(a) complied with all obligations imposed on it by law;
(b) complied with all collective agreements for the time being having
effect with regard to those relations or the conditions of service of
the employee;
(c) maintained adequate and suitable records of the service of the
employee;
(d) paid all income tax under the PAYE system and payments due in respect
of national insurance contributions (including the employer's
contributions) after making the required deductions from salaries,
wages and bonuses paid by the Vendor;
(e) maintained proper records of the payments and deductions mentioned in
(d) above;
AGREEMENTS RELATING TO EMPLOYEES AND DIRECTORS
(62) the Vendor has not entered into -
(a) any agreement or arrangement with any trade union or any other body
representing employees of the Vendor;
(b) any agreement or arrangement to make any payments (other than
emoluments) to or on behalf of any of its directors or employees;
(c) any contract of service with any person which is not terminable by
the Vendor by four months' notice or less without payment of
compensation (except as provided by statute);
(d) any agreement imposing an obligation on the Vendor to increase the
rates of remuneration of, or to make any bonus or incentive payments
or any benefits in kind or any payments under a profit sharing scheme
to or on behalf of any of its employees at any future date;
INCENTIVE AND OTHER SCHEMES
(63) there is not in existence -
(a) any share incentive scheme, share option scheme or profit sharing
scheme for all or any of the Employees;
(b) any training scheme or arrangement in respect of which a levy may
become
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payable by the Vendor under applicable laws, and no proposals for any
such scheme or arrangement are under consideration by the Vendor;
CHANGES IN EMPLOYEES' REMUNERATION
(64) since the Accounts Date there has been no change in the terms of the
employment by the Vendor of any person who was at any time during the
accounting period ended on that date entitled to remuneration at an annual
rate exceeding (Pounds)10,000;
DISPUTES
(65) no dispute has arisen between the Vendor and a material number or category
of the Employees and, so far as the Vendor is aware, there are no
circumstances likely to give rise to any such dispute;
EMPLOYEES AND TERMS OF EMPLOYMENT
(66) full particulars of the identities, dates of commencement of employment, or
appointment to office, and terms and conditions of employment of the
Employees, including without limitation profit sharing, commission or
discretionary bonus arrangements, are fully and accurately set out in
Schedule 3;
----------
EMPLOYEES
(67) the Employees are all the employees of the Vendor.
FAIR EMPLOYMENT
(68) the Vendor has complied with the Fair Employment Act (NI) 1989 (as amended
by any subsequent legislation in force at the date of this agreement) ("the
Fair Employment Act") in all respects including where appropriate the
following:-
(a) the Fair Employment Commission has not made any recommendation,
direction or notice under Section 32-37 of the Fair Employment Act to
the Vendor;
(b) the Vendor has not received notification from the Fair Employment
Commission or elsewhere that any of its suppliers is an unqualified
person as defined by Section 38 of the Fair Employment) Act;
(c) the Vendor has not had any complaint made against it to the Fair
Employment Tribunal within the last twelve months, no questionnaire
has been issued in accordance with the Fair Employment Act within the
last twelve months and there is no case outstanding with the Fair
Employment Tribunal or on appeal from it;
PENSIONS
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(69) except under the Pension Schemes, the Vendor has not been a party to any
agreement, arrangement or understanding (whether contractual or otherwise)
for the provision by the Vendor of any relevant benefits (as defined in
Section 612(1) of the Taxes Act but as if the exception contained in that
Section were omitted) for any Employee, or for any dependant of any such
person in connection with which the Vendor is or may become liable to make
any payment;
(70) (a) no undertakings or assurances have been given to all or any of the
Employees as to the continuance, introduction, increase or
improvement of any retirement, death or disability benefits (whether
or not there is any legal obligation to do so); and
(b) no power or discretion has been exercised under the Pension Scheme to
augment or provide in respect of any Employee at the date of this
Agreement a benefit which would not otherwise have been augmented or
provided under the Pension Scheme in respect of such Employee;
(71) the UniComp Final Salary Scheme is an exempt approved scheme within the
meaning of Chapter I of Part XIV of the Taxes Act; it has at all times
complied with and been duly administered in accordance with all applicable
legislation, regulations and requirements (with the exception of
discrimination on grounds of sex arising from the provisions of United
Kingdom Social Security legislation, but including, without limitation, the
requirements of the Superannuation Funds Office and the Occupational
Pensions Board); and there is in force an appropriate contracting out
certificate (within the meaning of Section 30 of the Social Security
Pensions Act 1975) and nothing has been done or omitted to be done which
will or may result in the UniComp Final Salary Scheme ceasing to be an
exempt approved scheme or the contracting out certificate being cancelled,
surrendered or varied;
(72) the Vendor has duly complied with all its obligations under the Pension
Schemes and all amounts due to the trustees of the Pension Schemes and to
any insurance company in connection with the Pension Schemes have been
paid, and there are no material actions, suits or claims pending or
threatened in respect of the Pension Schemes (other than routine claims for
benefits);
(73) all benefits (other than a refund of contributions with interest where
appropriate) payable under the Pension Schemes on the death of a member
thereof while in an employment
53
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to which the Pension Schemes relates are fully insured under a policy
effected with an insurance company of good repute and each member thereof
has been covered for such insurance by such insurance company at its normal
rates and on its normal terms for persons in good health;
(74) no claim (other than routine claims for benefits) has been made against the
Vendor or the trustees or administrators of the UniComp Final Salary Scheme
in relation to the UniComp Final Salary Scheme;
ENVIRONMENTAL MATTERS
(75) no Environmental Authorisations are required to be in force or obtained in
connection with the continued use of the Premises or the conduct of the
Business;
(76) no claim of any violation breach or infringement of Environmental
Legislation has been made against the Vendor;
(77) no proceeding or other action of whatever nature is pending or is
threatened or under consideration seeking to impose any penalty applicable
under any Environmental Legislation;
(78) the continuing conduct of the Business or use of the Premises will not give
rise to any claim proceeding or action under any Environmental Legislation;
(79) there has been and is no breach of any Environmental Legislation;
(80) the existence and use of the Premises machinery and other property employed
in the conduct of the Business has been and is in accordance with
Environmental Legislation;
(81) there are in relation to the Business and/or the Premises no past or
present events conditions circumstances activities practices incidents
actions or plans which interfere with or prevent compliance or which give
rise to any common law or legal liability or otherwise form the basis of
any claim action suit proceeding hearing or investigation related to
matters arising under or pursuant to the Environmental Legislation;
(82) there has been no spill discharge leak emission injection escape deposit or
release of any kind on the Premises or into the environment whether from
the Premises or otherwise of any substances material or waste (whether
solid liquid or gaseous) capable of causing harm to the health of living
organisms or the environment or other interference with the ecological
systems of which living organisms form part and in the case of man includes
offence caused to any of his senses or harm to his property related to the
Business other than those releases permissible under the Environmental
Legislation;
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(83) there is not currently and there has not been on the Premises any spill
leakage discharge release or deposit (whether to water land sewage systems
or air or a combination of these) of any substance material or waste
(whether solid liquid or gaseous) which:
(a) is capable of causing harm to the health of living organisms or the
environment or other interference with the ecological systems of
which living organisms form part and which in the case of man
includes offence caused to any of his senses or harm to his property
or;
(b) which may inhibit or restrict or make materially more costly any
operation of the Business or the occupation of or redevelopment of
the Premises or any part of them by reason of contamination or
otherwise;
(84) no notice order judgment demand or letter requiring the taking of remedial
or other action under or pursuant to the Environmental Legislation has been
served on or received by the Vendor;
(85) the Vendor has no indebtedness obligation or liability absolute or
contingent in respect of the Environmental Legislation with respect to the
storage treatment clean-up or disposal of any pollutant contaminant
substance material or waste (whether solid liquid or gaseous);
(86) neither the Vendor or the Premises nor the Business of the Vendor have been
the subject of any environmental audit any evaluation assessment study or
test;
THE VENDOR'S ACTIVITIES
(87) (a) the Vendor is entitled to enter into and carry out the provisions of
this agreement and has full power and authority to sell the Assets to
the Purchaser without obtaining the consent of any third party;
(b) compliance with the terms of this agreement, and any document entered
into by the Vendor in accordance with it, does not and will not
conflict with or result in a breach of any of the provisions of the
Vendor's Memorandum or Articles of Association;
(c) the Vendor has at all times carried on the Business in all respects
in accordance with its Memorandum and Articles of Association for the
time being in force and any other documents to which it is or has
been a party;
(d) neither the Vendor nor any of its members has any interest, directly
or indirectly, in any company or business other than the Business
which is or is likely to be
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or become competitive with the Business, save as registered holder or
beneficial owner of not more than 5 per cent any class of securities
of any company which is listed and/or dealt in on the Stock Exchange;
MISCELLANEOUS
MATERIAL INFORMATION
(88) all information relating to the Vendor which is known or would on
reasonable enquiry be known to the Vendor and which is material to be known
by a purchaser for value of the Business has been disclosed to the
Purchaser in writing;
RECITALS SCHEDULES AND DISCLOSURES
(89) the recitals and Schedules to the Agreement and all information and
documents relating to the Business disclosed or supplied by the Vendor or
any agent of it to the Purchaser, its solicitors, accountants or other
agents or advisers during or with a view to the negotiations leading up to
the Agreement, including (but not limited to) the Replies to the Pre-
Contract Enquiries issued by the Purchasers Solicitors and the information
contained in the Disclosure Letter, are true, complete and accurate in all
respects, and there is no fact not disclosed which would render any such
information or document inaccurate or misleading or which, if disclosed,
might reasonably affect the willingness of the Purchaser to purchase the
Business and Assets for the consideration or otherwise on the terms
specified in the Agreement;
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SCHEDULE 3
EMPLOYEES
see attached lists
57
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SCHEDULE 4
EXCLUDED ASSETS
The following assets and all liabilities (save for the Creditors) of the Vendor
are excluded from the sale and purchase -
(1) The Statutory Books and statutory records of the Vendor;
(2) Any cash at hand or in the Vendor's Bank as at the Effective Date and
recorded in the Completion Accounts;
(3) The benefit of any insurance claims and VAT allowances and repayments
arising prior to Completion in relation to the Business;
(4) Any debts due to the Vendor as a result of the acquisition by the Vendor of
the Eurodis business;
(5) Any debts due to the Vendor from any member of the Guarantor's Group;
(6) The sum of (Pounds)247,000 attributable to goodwill in the Accounts;
(7) The payroll computer and modem.
(8) The Renault Clio registration number DMN 164 N
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SCHEDULE 5
PENSIONS
(1) INTERPRETATION
In this Schedule the following expressions shall unless the context requires
have the following meanings.
"Employees" means employees of the Vendor who as at
Completion accept employment with the Purchaser
under the terms of the Agreement
"Final Salary Employees" means the Employees of the Vendor who are
members of the Vendor's Final Salary Scheme.
"Group Pension Employees" means the employees of the Vendor who are
members of the Vendor's Group Pension Scheme.
"Interim Period" means the period commencing on the day following
Completion and ending on the 31st March 1999 or
such earlier or later date as the Vendor and
Purchaser shall agree.
"Purchaser's Scheme" means the "Options" section of the Northern
Ireland Electricity Pension Scheme.
"Transfer Amount" means for each Final Salary Employee the greater
of:-
(i) 108% of the normal leaving service transfer
value calculated at Completion (or such other
date as is agreed between the Purchaser and the
Vendor) and adjusted to reflect a return for
Fund Investment Returns (as measured by changes
in the value of Britannia Investment Manager's
Pensions Managed Fund units) for the period from
and including Completion (or such other date of
calculation as is agreed between the Purchaser
and the Vendor) up to and excluding the day
prior to the date of payment; and
(ii) the statutory minimum cash equivalent
transfer value at the Effective Date as defined
in the Pensions Act 1995
<PAGE>
The calculations under (i) and (ii) above
shall be in respect of pre 6 April 1988
service and benefits in excess of
contracted-out guaranteed minimum pensions
only.
"Vendor's Final Salary Scheme" means the UniComp Final Salary Scheme.
"Vendor's Group Pension means the UniComp Group Personal Pension.
Scheme"
(2) FINAL SALARY EMPLOYEES
(a) On Completion (or such other date as is agreed between the Purchaser
and the Vendor) the Final Salary Employees shall be treated as leavers
of the Vendor's Final Salary Scheme based on service to 31st December
1998
(b) The Vendor undertakes to procure that the Transfer Amounts are paid by
the trustees of the Vendor's Final Salary Scheme to each Final Salary
Employee who elects to transfer to the Purchaser's Scheme on or before
31st March 1999.
(c) In the event that any of the Transfer Amounts exceed the amounts paid
by the trustees of the Vendor's Final Salary Scheme to any of the Final
Salary Employees then the Vendor will pay to such Final Salary
Employees in cash within 14 working days of the date payment is made by
the trustees, an amount equal to the difference together with interest
at the Bank of Ireland Base Rate plus 3 per cent from such date.
(d) The Purchaser agrees to offer membership of the Purchaser's Scheme to
the Final Salary Employees with effect from 1st January 1999.
(e) The Vendor will indemnify the Purchaser against all costs claims
liabilities and expenses (including legal expenses) arising out of or
in connection with any claim by a Final Salary Employee relating to the
loss by such employee of final salary benefits. The Purchaser shall
inform the Vendor of any event which comes to the notice of the
Purchaser whereby it appears that the Vendor is or is likely to become
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liable under the foregoing indemnity as soon as reasonably practicable
after such event comes to the Purchaser's notice. Subject always to the
Purchaser receiving an indemnity to its reasonable satisfaction in
relation to any costs or expenses incurred by the Purchaser, and
subject to the overriding right of the Purchaser to protect its
business and so that it may not be required to act in an unreasonable
or excessive manner, the Purchaser shall take such action as the Vendor
may reasonably request in writing to avoid, dispute, resist, mitigate,
compromise, defend or appeal against any claim in respect thereof and
any adjudication with respect thereto. At the request of the Vendor the
conduct of any proceedings of whatsoever nature arising in connection
with any such claim shall be delegated entirely to the Vendor and in
that connection the Purchaser shall give or cause to be given to the
Vendor all such assistance as the Vendor may reasonably require in
disputing any such claim and shall instruct such solicitors or other
professional advisers as the Vendor may nominate to act on behalf of
the Vendor, but in accordance with the Vendor's instructions. The
Purchaser shall not and shall procure that the Company will not admit
liability in respect of or compromise or settle any such claim without
the prior written consent of the Vendor (such consent not to be
unreasonably withheld or delayed).
(3) GROUP PENSION EMPLOYEES
(a) The Vendor shall arrange for the Group Pension Employees to remain
members of the Vendor's Group Pension Scheme for the Interim Period.
(b) During the Interim Period the Purchaser undertakes to pay to the
Vendor's Group Pension Scheme the Employer's contributions and those of
the Group Pension Employees in accordance with the rules of the
Vendor's Group Pension Scheme.
(c) The Purchaser agrees to offer membership of the Purchaser's Scheme to
the Group Pension Employees with effect from 1st April 1999.
4 The Vendor and the Purchaser shall co-operate in achieving the above
objectives and in
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making any necessary submissions to the Pension Scheme Funds Office and the
Contributions Agency.
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SCHEDULE 6
COMPLETION ACCOUNTS
(1) The Completion Accounts shall:
(a) be prepared on a going concern basis using the historical cost
convention in accordance with all relevant statutes and generally
accepted accounting principles and practice;
(b) give a true and fair view of the state of affairs of the Vendor and the
assets and liabilities of the Vendor as at the Effective Date and the
profits and losses of the Vendor for the period ended on that date;
(c) be prepared on a basis consistent with and using the same accounting
principles as set forth and used in preparation of the Accounts;
(d) in so far as is practicable ascribe values to each of the Assets listed
at clause 2.1 herein (save for the Goodwill and the Intellectual
Property Rights).
(2) Without limiting the generality of paragraph 1 the Completion Accounts
shall:
(a) either make full provision for or, as appropriate, disclose all
liabilities whether actual, contingent or disputed (including financial
lease commitments, and all liabilities whether actual, contingent or
disputed of the Vendor for income tax, profits tax or corporation tax
measured by reference to actual or deemed taxable profits (including
both income and chargeable gains) made or deemed to have been made on
or before the Effective Date and for any other taxes, duties or other
fiscal impositions of any kind whatsoever (including any interest on
any such amounts and any penalties or charges imposed in relation to
such amounts) whether arising under any law of the United Kingdom or
any part thereof or any law of any other jurisdiction and whether
incurred as principal, agent or trustee) and all capital commitments,
whether actual or contingent, of the Vendor as at the
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Effective Date in accordance with generally accepted accounting
principles;
(b) shall value stock and work in progress (upon the basis of a
stocktaking) at the lower of cost and net realisable value with
appropriate write downs for slow moving stock and redundant or obsolete
stock but reduced by the amount of any prepayments or deposits received
by the Vendor prior to the Effective Date. For the avoidance of doubt
"cost" does not include a general uplift for overheads.
(c) provide in full for non-routine maintenance of plant, machinery and
equipment.
(d) shall value Diagnostic Spares (upon the basis of a stocktaking) in a
manner consistent with the Accounts (for the avoidance of doubt
depreciated over a four or three year period)
(e) shall value remaining spares (upon the basis of a stocktaking) at the
lower of cost and net realisable value with appropriate write downs for
slow moving spares and redundant or obsolete spares but reduced by the
amount of any prepayments or deposits received by the Vendor prior to
the Effective Date . For the avoidance of doubt "cost" does not
include a general uplift for overheads.
(f) shall deal with holiday pay as stated as clause 9.4 of the Agreement
(g) shall deal with apportionments as stated as clause 12 of the Agreement
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SCHEDULE 7
PART 1 MAINTENANCE CONTRACTS
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SCHEDULE 7
PART 2 REMAINING CONTRACTS
1 Strategix Licence.
2 Tesseract Software Licence
3 Lotus Passport Software
4 Lotus Password Programme Software Agreement.
5 Licence Agreements with Seagate (4 of)
6 Licence Agreement with Persoft.
7 Microsoft End User Licence Agreement for Microsoft Office.
8 Cisco Systems Certificate
9 Novell.
10 BT Network Services 1997 and BT Internet Provider
11 Compaq Service Provider.
12 Apple Authorised Service Provider.
13 Research Machines.
14 Cabletron synergy platinum plus.
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SCHEDULE 8
HIRE/LEASE AGREEMENTS
1 Hire Agreement from Network Finance to Aurora Unicomp Ltd
For three years commencing 29 October 1997.
2 Two Hire Purchase Agreements from Causeway Credit Limited in the name of CEM
Computers Ltd for two Renault Lagunas
Each for 33 monthly instalments of (Pounds)401 commencing on 5th March 1997
3 Agreement between Siemens GEC and CMI Limited dated 21 May 1997 (GVD
Finance, Financing Leasing Agreement).
together with list attached hereto
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SCHEDULE 9
PLANT AND COMPUTER EQUIPMENT
The fork-lift truck, the Audi Cabriolet UDZ 4992, Landrover Discovery LIL 4200,
Vauxhall Cavalier, Radial Shelving, Facett Stand together with the computer
equipment detailed in the attached list.
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SCHEDULE 10
VENDOR'S PROTECTION PROVISIONS
(1) The liability of the Vendor in relation to the Warranties shall cease on the
30th June 2001 ("the Expiry Date") save as regards any alleged specific
breach of which notice in writing (containing, so far as is practicable,
reasonable details of the event or circumstance giving rise to the breach,
the basis upon which the Purchaser is making a claim against the Vendor and
the estimated total amount of liability which results) has been given to the
Vendor prior to the Expiry Date. Any claim under the Warranties (a
"Warranty Claim) shall be deemed to have been withdrawn (if it has not been
previously satisfied settled or withdrawn) 6 months after the expiration of
the Expiry Date unless proceedings in respect of it have been issued and
served on the Vendor.
(2) The Vendor shall not be liable for any Warranty Claim unless its liability
exceeds the sum of (Pounds)2,500 in respect of such claim.
(3) No liability shall attach to the Vendor in respect of any claims under the
Warranties unless the aggregate liability of the Vendor in respect of all
such claims shall exceed (Pounds)50,000 (in which event subject to the
provisions of Paragraph (2)) the Vendor shall be liable for the full amount
of such claims and not only the excess over such sum of (Pounds)50,000.
(4) The total liability of the Vendor under the Warranties shall not in any
event exceed (Pounds)4,500,000
(5) The Vendor shall have no liability (or such liability shall be reduced) in
respect of any Warranty Claim if and to the extent that provision or reserve
for or in respect of the liability or other matter giving rise to such claim
has been made in the Accounts or included in Creditors in the Completion
Accounts.
(6) The Vendor shall not be liable (or such liability shall be reduced) in
respect of any Warranty Claim:
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<PAGE>
(a) if and to the extent that it would not have arisen but for anything
voluntarily done or omitted to be done after Completion by the
Purchaser otherwise than in the ordinary course of business.
(b) if and to the extent that it arises or is increased as a result only of
any change in generally accepted accounting practice within the United
Kingdom after the date hereof for the passing of any legislation, or
the making of any subordinate legislation after Completion which takes
effect retrospectively.
(c) to the extent that it relates to any loss which is recoverable by the
Purchaser from its insurers or would have been so recoverable if at the
relevant time there had been maintained valid and adequate insurance
cover of the type and affording broadly the same degree of cover as
that in force in relation to the Assets at the date of this agreement;
(7) If any matter comes to the notice of the Purchaser whereby it appears that
the Vendor is or is likely to become liable under the Warranties the
Purchaser shall:-
(a) as soon as reasonably practicable give written notice thereof to the
Vendor specifying the nature of the claim in reasonable detail
(b) (subject to the overriding right of the Purchaser to protect its
business and so that it may not be required to act in an unreasonable
or excessive manner) not admit liability in respect of or compromise or
settle any such claim without consulting the Vendor
(c) give such information and assistance in connection with its affairs as
the Vendor may reasonably request in writing to avoid, dispute, resist,
mitigate, compromise, defend or appeal against any claim in respect
thereof and any adjudication with respect thereto.
(8) Subject to the overriding right of the Purchaser to protect its business and
so that it may not be required to act in an unreasonable or excessive
manner, the Purchaser shall permit the Vendor (whether before or after
payment of any claim) to avoid dispute resist appeal compromise or defend
any matter which may otherwise result in bat claim and will give the Vendor
all authorities and assistance as may be reasonably requested by the Vendor
to enable it to do so (subject to the Vendor providing the Purchaser with
70
<PAGE>
an indemnity in respect of all proper and reasonable costs and expenses
incurred by the Purchaser)
71
<PAGE>
THIS IS THE AGREED DRAFT REFERRED TO IN CLAUSE 4.3.1 OF AN AGREEMENT DATED
DECEMBER 1998 AS SIGNED BY OR ON BEHALF OF THE PARTIES THERETO FOR THE PURPOSE
OF IDENTIFICATION.
ASSIGNMENT OF GOODWILL
THIS ASSIGNMENT made the day of One thousand nine hundred and
- ---------------
ninety-eight
BETWEEN
(1) AURORA UNICOMP LIMITED having its registered office at UniComp House,
Mallusk Road, Newtonabbey, BT36 8WU (hereinafter called "the Vendor"); and
(2) AURORA SX3 LIMITED its registered office at 120 Malone Road, Belfast BT9 5HT
(hereinafter called "the Purchaser")
WHEREAS:-
1. This Deed is supplemental to an Agreement made between the Vendor and the
Purchaser dated the day of December 1998 ("the Agreement").
2. Any words or phrases defined in the Agreement shall have the same meaning
herein.
NOW THIS DEED WITNESSETH as follows:-
1. In consideration of the sum of (Pounds) paid by the Purchaser to the
Vendor (the receipt of which the Vendor hereby acknowledges) the Vendor as
Beneficial Owner HEREBY ASSIGNS unto the Purchaser the Goodwill of the
Business carried on by the Vendor at the Premises including the right to the
exclusion of the Vendor to trade under the Name and the exclusive right to
carry on the said Business in succession to the Vendor TO HOLD the same unto
the Purchaser absolutely.
2.1 The Vendor hereby covenants with the Purchaser with the intent of assuring
to the Purchaser the full benefit and value of the Goodwill and connections
of the Business and as a constituent part of the agreement for the sale of
the Business that:-
72
<PAGE>
(a) it will not for a period of five (5) years from the date hereof ("the
Said Period") directly or indirectly and whether for his own account or
in partnership with another or others either as principal or as servant
or agent or officer of another deal with or engage in business with or
be interested in any concern undertaking firm or body corporate which
engages in or carries on within the United Kingdom and/or the Republic
of Ireland any business which competes or seeks to compete with the
Business.
(b) it will not at any time following Completion divulge to any person or
otherwise make use of any secrets, trade secrets, confidential
knowledge or information concerning the business finance or affairs of
the Business and belonging to the Business and will use its best
endeavours to prevent the publication or disclosure of any such
secrets, knowledge or information by any third party.
(c) without prejudice to the generality of the provisions contained in the
immediately preceding sub-clauses 2.1(a) and 2.1(b) it will not for the
Said Period directly or indirectly in competition with the Business;
(i) solicit the custom of any person, firm or company which has at
any time during the period of one year preceding Completion been
a customer or client of the Business or which has approached in
any such period as aforesaid the Business with a view to placing
business or otherwise becoming a customer or client of the
Business;
(ii) solicit or endeavour to entice away, or employ, or offer or
conclude any contract of services with any person who was
employed by the Vendor at any time during the period of one year
preceding Completion.
Provided always that nothing in this Agreement shall restrict ICS Unicomp
Limited from carrying out its current business of the sale of computer
hardware.
2.2 While the restrictions aforesaid are considered by the parties to be fair
and reasonable in all the circumstances it is agreed that if any of such
restrictions shall be adjudged to be void or ineffective for whatever reason
but would be adjudged to be valid and effective if part or parts of the
wording thereof were deleted or the periods thereof reduced or the area
thereof reduced in scope the said restrictions shall apply with such
modifications as may be necessary to make them valid and effective.
73
<PAGE>
deleted or the periods thereof reduced or the area thereof reduced in scope
the said restrictions shall apply with such modifications as may be
necessary to make them valid and effective.
IN WITNESS whereof S. A. Haffer on behalf of the Vendor has executed as a Deed
the day and year first before written.
Executed as a Deed by AURORA :
UNICOMP LIMITED :
in the presence of:- : /s/ S. A. Haffer, Chairman
/s/ Maurice R. Butler :
Solicitor :
Belfast :
74
<PAGE>
DATED THIS DAY OF DECEMBER 1998
AURORA UNICOMP LIMITED
(Vendor) (1)
AURORA SX3 LIMITED
(Purchaser) (2)
ASSIGNMENT OF GOODWILL
----------------------
CARSON & MCDOWELL,
SOLICITORS,
MURRAY HOUSE,
MURRAY STREET,
BELFAST BT1 6HS
75
<PAGE>
THIS IS THE AGREED DRAFT REFERRED TO IN CLAUSE 10.2 OF AN AGREEMENT DATED
AS SIGNED BY OR ON BEHALF OF THE PARTIES THERETO FOR THE PURPOSE OF
IDENTIFICATION.
ASSIGNMENT OF DEBTORS
THIS ASSIGNMENT made the day of One thousand nine hundred and
- ---------------
ninety-eight
BETWEEN
(1) AURORA UNICOMP LIMITED having its registered office at UniComp House,
Mallusk Road, Newtonabbey, BT36 8WU (hereinafter called "the Vendor"); and
(2) AURORA SX3 LIMITED its registered office at 120 Malone Road, Belfast BT9 5HT
(hereinafter called "the Purchaser")
WHEREAS:-
1.1 This Deed is supplemental to an Agreement made between the Vendor and the
Purchaser dated the day of December 1998 ("the Sale Agreement").
1.2 Any words or phrases defined in the Sale Agreement shall have the same
meaning herein.
1.3 The Vendor has agreed with the Purchaser for the absolute assignment to the
Purchaser of the debts set out in the Schedule hereto in the manner
hereinafter appearing.
NOW THIS DEED WITNESSETH as follows:-
- ------------------------
In pursuance of the said Sale Agreement and in consideration of the payment of
the sum of (Pounds) by the Purchaser to the Vendor the Vendor as
beneficial owner hereby assigns unto the Purchaser all that the full amount of
the debt set out in the Schedule hereto and the full benefit and advantage
thereof TO HOLD the same unto the Purchaser absolutely.
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<PAGE>
IN WITNESS whereof the common seal of the Vendor has hereunto been affixed the
day and year first before written.
The Common Seal of AURORA :
UNICOMP LIMITED was affixed hereto :
in the presence of:- :
:
:
:
:
77
<PAGE>
SCHEDULE
78
<PAGE>
DATED THIS DAY OF 1998
AURORA UNICOMP LIMITED
(Vendor) (1)
AURORA SX3 LIMITED
(Purchaser) (2)
ASSIGNMENT OF DEBTORS
---------------------
CARSON & MCDOWELL
SOLICITORS
MURRAY HOUSE
MURRAY STREET
BELFAST BT1 6HS
79
<PAGE>
Dated this 17 day of December 1998
SX3 LIMITED
(Lender) (1)
UNICOMP HOLDINGS (UK) LIMITED
(Borrower) (2)
LOAN AGREEMENT
--------------
Carson & McDowell
Murray House
Murray Street
BELFAST BT1 6HS
----------------
1
<PAGE>
DATED 17 December 1998
- --------------------------------------
PARTIES:
- --------
(1) SX3 LIMITED its registered office at 120 Malone Road, Belfast BT9 5HT
(hereinafter called "the Lender") of the first part;
(2) UNICOMP HOLDINGS (UK) LIMITED having its registered office at Acre House
11-15 William Road London NW1 3ER (hereinafter called "the Borrower") of
the second part;
RECITALS:
- ---------
The Lender has agreed to lend to the Borrower and the Borrower has agreed to
borrow from the Lender the Loan upon and subject to the terms of this agreement.
OPERATIVE PART:
- ---------------
1. DEFINITIONS AND INTERPRETATION
1.1 In this agreement the following words and expressions (either with or
without the definite or indefinite article) will unless the context
otherwise requires have the following meanings:
Expression Meaning
---------- -------
(a) "Event of Default" any such event as is described at clause six
herein
(b) "the Insolvency Order" (subject to sub-clause 1.2.1) the Insolvency
(Northern Ireland) Order 1989
(c) "the Loan" the sum of(pound)1,000,000 sterling
(d) "the Prescribed Rate" 1/2% (net) above the base lending rate of
Bank of Ireland from time to time
(e) "the Retention" the sum of(pound)250,000
1.2 In this agreement unless the context otherwise requires:
(a) references to any statute or statutory provision includes
references to:
(i) that statute or statutory provision as from time to
time amended, extended,
re-enacted or consolidated, and;
(ii) all statutory instruments or orders made pursuant to
it.
(b) words denoting the singular number only include the plural and
vice versa and words denoting any gender include all genders
and words denoting persons include firms and corporations and
vice versa;
(c) references to any clause or sub-clause are to a clause or sub-
clause (as the case may be) of or to this agreement;
(d) the headings in this document are inserted for convenience
only and will not affect the construction or interpretation of
this agreement.
2
<PAGE>
2. ADVANCE
2.1 The Lender lends to the Borrower and the Borrower borrows from the Lender
the Loan.
2.2 The Loan shall be made available to the Borrower as follows:
(a) as to (pound)750,000 in cash upon the date of execution hereof
(b) as to the Retention in accordance with clause
3. REPAYMENT OF LOAN
3.1 Subject as provided in this agreement the Borrower will repay the Loan
(which for the avoidance of doubt means, the full amount of 1,000,000
pounds reducing in accordance with the monthly payments made pursuant to
this clause) in 24 (twenty-four) equal monthly instalments the first such
instalment to be paid on the 19th day of January 1999.
4. INTEREST
4.1 Subject as provided in this agreement the Borrower will pay interest on the
balance of the Loan for the time being held by the Borrower (which for the
avoidance of doubt means, the amount of 750,000 pounds reducing in
accordance with the monthly payments made pursuant to clause 3 above but
increasing on the release of the Retention) at the Prescribed Rate which
interest will accrue daily and shall be paid monthly in arrears.
5. EARLY REPAYMENT
5.1 The Borrower will be entitled from time to time on giving to the Lender not
less than 10 days' notice in writing of its intention to do so repay:
(a) the Loan, or;
(b) the balance of the Loan for the time being outstanding, or;
(c) any part of the Loan specified in the Borrower's notice which amounts
to 1,000 pounds or a multiple of that amount
and upon the expiration of the Borrower's notice the Borrower will be
bound to repay such amount together with all interest which has accrued
on the amount so repaid.
5.2 Whenever only part of the balance of the monies due to the Borrower for the
time being is paid pursuant to sub-clause 5.1 the sum repaid will be
applied firstly in satisfaction or reduction pro tanto of any outstanding
payments of interest due in accordance with subclause 4.1 and so that no
repayment will be applied towards the reduction of any part of the
outstanding principal of the Loan while any amount of the interest payable
pursuant to sub-clause 4.1 remains due and payable.
6. IMMEDIATE REPAYMENT
6.1 Notwithstanding anything contained in clauses 2 to 5 the Loan or (as the
case may be) the balance of the Loan for the time being outstanding will
become immediately repayable and all unpaid interest which has accrued
under this agreement will become
3
<PAGE>
immediately payable:
(a) if the Borrower makes default in the payment of any money due under
this agreement and the Lender by notice in writing to the Borrower
demands immediate repayment of the Loan or the balance of the Loan
then outstanding, or;
(b) if a petition is presented, an order is made, an effective resolution
is passed or a meeting is convened for the purpose of considering a
resolution for winding up the Borrower, or;
(c) if the Borrower stops payment or ceases or threatens to cease to carry
on its business or substantially the whole of its business, or;
(d) if an encumbrancer takes possession or any administrative or other
receiver or any manager or administrator or similar officer is
appointed to the Borrower over the whole or any part of the assets of
the Borrower, or;
(e) if any attachment, diligence, distress, execution, sequestration or
other process is levied or enforced upon or sued out or enforced or
effected on or against, or affects, any of the assets or property of
the Borrower and is not discharged within 7 days, or;
(f) if the Borrower is unable to pay its debts within the meaning of the
Insolvency Order Article 103 or becomes or is deemed to be insolvent
within the meaning of the Insolvency Order Article 6(1) or goes into
liquidation within the meaning of the Insolvency Order Article 6(2),
or;
(g) if the Borrower commits any breach of this agreement or any security
granted pursuant or in relation hereto and in the case of any breach
capable of remedy fails to remedy the breach within 14 days of being
required in writing by the
Lender to do so;
(h) if any steps are taken to enforce any standard security, pledge, lien,
charge, assignation by way of security, hypothecation or security
interest or any other encumbrance, agreement or arrangement which has
the effect of conferring any of the same or any security or security
interest whatsoever in or over the Borrower or its assets;
(i) if any steps are taken with a view to proposing (under any enactment
or legislation or otherwise) any kind of composition, scheme of
arrangement, compromise or arrangement involving the Borrower and any
of its creditors (or any class of them);
(j) if any corporate, legal or administrative proceedings are commenced
with a view to the dissolution of the Borrower;
(k) if there occurs, in relation to the Borrower, in any country or
territory in which it carries on business or to the jurisdiction of
whose courts any substantial part of its assets is subject, any event
which substantially corresponds in that country or territory with any
of those mentioned in sub-clauses 6.1(a) to 6.1(k) above, or the
Borrower otherwise becomes subject, in any country or territory, to
the operation
4
<PAGE>
of any law or procedure relating to insolvency, bankruptcy or
liquidation.
7. APPLICATION OF THE LOAN
7.1 The Borrower will apply the Loan exclusively towards the general
requirements of the Borrower's business.
8. COVENANTS BY THE BORROWER
8.1 The Borrower covenants with the Lender that so long as any part of the
Loan or any interest due in respect of the Loan is outstanding the
Borrower will:
(a) carry on its business and undertaking in an efficient and business-
like manner and will not make any substantial alteration in the nature
of such business;
(b) not save with the written consent of the Lender sell or otherwise
dispose of the whole or any substantial part of its undertaking or of
its assets;
(c) not save with the written consent of the Lender make any loan or
advance or give any guarantee or provide any credit (other than normal
trade credit given in the ordinary course of business);
(d) not save with the written consent of the Lender enter into any credit
sale loan or hire purchase agreement;
(e) not save with the written consent of the Lender subscribe for purchase
or otherwise acquire any part of the share capital of another company
or any debenture mortgage or other security or obligation of any other
company or person.
9. RETENTION
9.1 The Retention shall on the date hereof be paid into a joint account which
shall be opened in the names of the Borrower's Solicitors and the Lender's
Solicitors ("the Joint Account") and shall be dealt with in accordance with
the following sub-clauses.
9.2 Subject as provided in clauses 9.3, the Borrower's Solicitors and the
Lender's Solicitors shall pay the monies standing to the credit of the
Joint Account together with 50% (fifty per cent) of any accrued interest
but less any bank charges to the Borrower on the anniversary of the date
hereof ("the Payment date") but so that the Lender may deduct from any such
payment any amount due under clause 9.3. The Borrower's Solicitors and the
Lender's Solicitors shall pay the remaining 50% (fifty per cent) of any
accrued interest to the Lender.
9.3 If prior to the Payment date, an Event of Default occurs, the Borrower's
Solicitors and the Lender's Solicitors shall immediately pay the Retention
together with any accrued interest but less any bank charges to the Lender
out of the Joint Account
9.4 The payment of any sum to the Lender in accordance with clause 9.3 shall
not in any way prejudice or affect any other rights or remedies of the
Lender for the purpose of
5
<PAGE>
recovering any amount due from the Borrower and not satisfied by payment
made out of the Joint Account.
9.5 The Borrower and the Lender shall as and when necessary give instructions
to the Borrower's Solicitors and the Lender's Solicitors respectively in
order to procure compliance with clauses 9.2, and 9.3. The Borrower's
Solicitors and the Lender's Solicitors shall not be required to take any
action with respect to the Joint Account except on the written instructions
of the Borrower and the Lender.
10. LEGAL COSTS AND EXPENSES
10.1 The Borrower will reimburse the Lender on demand the reasonable legal costs
and out-of-pocket expenses incurred by the Lender in connection with any
enforcement of any terms of this agreement.
11. NOTICES
11.1 Any notice required to be given by either part to the other under this
agreement will be in writing and will be served by sending the same by pre-
paid first class post, telex or facsimile transmission or by delivering the
same by hand to the last known address or place of business for the time
being of the relevant party and any notice so served will be deemed to have
been served:
(a) if delivered by hand at the time of such delivery;
(b) if sent through the post 48 hours after the time of despatch and in
proving service it will be sufficient to prove that the envelope
containing such notice was properly delivered or stamped addressed and
placed in the post, and;
(c) if sent by facsimile transmission at the time of transmission and in
proving service it will be sufficient to prove that such facsimile was
duly despatched to a current facsimile number of the addressee for the
said address for service.
12. FURTHER ASSURANCE
12.1 The Borrower undertakes with the Lender to execute and deliver any other
document(s) and take any other steps as may be reasonably required by the
Lender to carry the terms of this agreement into full force and effect.
13. ASSIGNMENT
13.1 The Lender may assign the benefit of this agreement without recourse to the
Borrower.
13.2 The Borrower may only assign its rights and obligations under this
agreement with the prior written consent of the Lender which the Lender may
in its absolute discretion withhold.
14. LAW
14.1 This agreement will be governed and construed in accordance with the law of
Northern
6
<PAGE>
Ireland and the Lender and the Borrower submit to the non-exclusive
jurisdiction of the High Court in Belfast in relation to any dispute
arising in connection with the terms hereof.
IN WITNESS whereof on behalf of the Lender, have hereunto set their
hands, and this agreement has been executed as a deed by the Borrower the day
and year first before WRITTEN.
SIGNED by :
for and on behalf of SX3 LIMITED :
in the presence of:- :
:
:
:
:
:
Executed as a Deed by UNICOMP HOLDINGS:
(UK) LIMITED in the presence of:- :
:
:
:
:
:
7
<PAGE>
DATED THIS 17 DAY OF DECEMBER 1998
(1) UNICOMP HOLDINGS (UK) LIMITED
(THE `COMPANY')
AND
(2) SX3 LIMITED
MORTGAGE
CARSON & MCDOWELL
SOLICITORS
MURRAY HOUSE
MURRAY STREET
BELFAST BT1 6HS
1
<PAGE>
INDEX TO CLAUSES
1 Definitions and Interpretation
2 Covenant to Pay
3 Security
4 Discharge
5 Restrictions
6 Covenants by the Company
7 Power to Remedy
8 Enforcement
9 Appointment and Powers of Receiver
10 Lender's Liability
11 Protection of Third Parties
12 Powers of Leasing
13 Power of Attorney
14 Lender's Rights
15 Costs and Expenses
16 Continuing Security
17 Notices
18 Transfers
19 Miscellaneous
20 Law and Jurisdiction
21 Unregistered Land
22 Registered Land
Schedule
2
<PAGE>
THIS Mortgage is dated 17 December 1998 and made BETWEEN:
(1) UNICOMP HOLDINGS (UK) LIMITED having its registered office at Acre
House 11-15 William Road London NW1 3ER (the `Company') and
(2) SX3 LIMITED its registered office at 120 Malone Road, Belfast BT9 5HT
(the `Lender')
WHEREAS:
Recitals if preferred
NOW THIS DEED WITNESSES and it is agreed and declared as follows:
1. DEFINITIONS AND INTERPRETATION
1.1 Unless the context otherwise requires or unless otherwise defined in this
Mortgage, words and expressions shall have the same respective meanings that are
ascribed to them in the Loan Agreement.
1.2 DEFINITIONS
In this Mortgage unless the context otherwise requires:
`Advance' means the sum of one million pounds ((pound)1,000,000) now
advanced by the Lender to the Company (the receipt of which sum the
Company hereby acknowledges).
`CA' means the Conveyancing Act 1881.
`Encumbrance' means any mortgage charge pledge lien assignment
hypothecation security interest preferential right or trust arrangement
or other encumbrance security agreement or arrangement of any kind or
any right conferring a priority of payment.
`Enforcement Event' means any of the events or circumstances described
in clause 8 of the Loan Agreement.
`Expenses' means all interest commission fees and legal and other costs
charges and expenses which the Lender or any Receiver may charge or
incur in relation to the Company or this Mortgage and the preparation
negotiation and creation of this Mortgage and/or in relation to the
Mortgaged Property and/or breach of any provision of, and the
protection realisation or enforcement of, this Mortgage in each case on
a full indemnity basis.
`Loan Agreement' means the Loan Agreement of even date and made between
(1) Sx3 Limited and (2) Unicomp Holdings (UK) Limited and any variation
amendment or extension thereof or supplement thereto from time to time
in force.
3
<PAGE>
`Insured Risks' means fire storm lightning earthquake explosion
aircraft riot civil commotion malicious damage impact terrorism
aircraft and other aerial devices or articles dropped therefrom tempest
flood bursting and overflowing of water tanks apparatus or pipes and
damage by or resulting from vehicular impact and such other risks as
the Lender shall approve including demolition and site clearance costs
and expenses architects surveyors and other professional fees and all
other incidental expenses and loss of rents payable by the tenants or
other occupiers of the property for a period of three years or for such
longer period as the Lender shall from time to time require.
`Interest Payment Date' means each of the dates prescribed for payment
referred to in clause 3 of the Loan Agreement.
`Interest Rate' means the Prescribed Rate as defined in the Loan
Agreement
`Lease' means where the Property is leasehold the lease under which the
Company holds the Property short particulars of which are set out in
Part II of the Schedule and any instrument supplemental to it or which
is expressed to be collateral to it or entered into pursuant to or in
accordance with its terms.
`Mortgage' means this Mortgage and includes any instrument supplemental
to or which is expressed to be collateral or entered into pursuant to
or in accordance with the terms of this Mortgage.
`Mortgaged Property' means the property assets debts rights and
undertaking charged to the Lender by this Mortgage and includes any
part of or interest therein.
`Planning Order' means the Planning (NI) Order 1989
`Property' means the freehold leasehold or immovable property referred
to in Part I of the Schedule and any part or parts of it and including
all rights attached or appurtenant to it and all buildings fixtures
fittings plant and machinery from time to time situate on it and
belonging to the Company.
`Prior Charge(s)' means the Encumbrances existing at the date of this
Mortgage, details of which are set out in Part III of the Schedule.
`Receiver' means an administrative receiver, receiver and/or manager
and any substitute for any such person and whether appointed under this
Mortgage or pursuant to any statute or otherwise.
`Repayment Dates' means those dates relating to payment referred to in
the Loan Agreement
`Secured Liabilities' means the Advance and the Expenses and all
interest which the Lender may charge or incur in relation to the
Company or this Mortgage or the enforcement of this Mortgage or the
Property on a full indemnity basis and so that interest shall be
computed and compounded on the terms agreed between the parties or if
not agreed according to the usual practice of the Bank of Ireland as
well after as before any demand or judgment.
4
<PAGE>
1.3 Interpretation
In this Mortgage:
(a) references to Clauses and Schedules are to be construed as
references to the clauses of and schedules to this Mortgage;
(b) references to any provisions of this Mortgage or to any other
document or agreement are to be construed as references to
those provisions or that document or agreement as is in force
for the time being and as amended, varied, supplemented,
substituted or novated from time to time;
(c) words importing the singular are to include the plural and
vice versa;
(d) references to a person are to be construed to include
references to a corporation, firm, company, partnership, joint
venture, unincorporated body of persons, individual or any
state or any agency of a state, whether or not a separate
legal entity;
(e) references to any person are to be construed to include that
person's assigns or transferees or successors in title,
whether direct or indirect;
(f) references to any statutory provision are to be construed as
references to that statutory provision as amended,
supplemented, re-enacted or replaced from time to time
(whether before or after the date of this Mortgage) and are to
include any orders regulations instruments or other
subordinate legislation made under or deriving validity from
that statutory provision;
(g) Clause headings are for ease of reference only and are not to
affect the interpretation of this Mortgage;
(h) where the `Company' consists of two or more parties:
(i) such expression shall in this Mortgage mean and
include such two or more parties and each of them or
(as the case may require) any of them;
(ii) all covenants charges agreements and undertakings
expressed or implied on the part of the Company in
this Mortgage shall be deemed to be joint and several
covenants, charges, agreements and undertakings by
such parties;
(iii) each shall be bound even if any other of them
intended or expressed to be bound by this Mortgage
shall not be so bound; and
(iv) the Lender may release or discharge any one or more
of them from all or any liability or obligation under
this Mortgage or may make any arrangement or
composition with any such person
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without thereby releasing any other or others of them
or otherwise prejudicing any of its rights under this
Mortgage or otherwise.
2. COVENANT TO PAY
2.1 The Company covenants with the Lender that the Company will:
(i) repay the Advance by equal instalments on the Repayment Dates;
(ii) pay interest on the amount of the Advance for the time being and from
time to time outstanding from the date of the Advance at the Interest Rate
(before and after any demand made or judgment obtained) such interest to accrue
from day to day and shall be payable on each Interest Payment Date;
(iii) pay to the Lender or discharge any other Secured Liability on demand.
2.2 If any payment falls due under this Mortgage on any day on which banks
are not generally open for business in the place of payment, the due date for
payment shall be extended to the next such day and interest shall be adjusted
accordingly.
3. SECURITY
3.1 The Borrower as beneficial owner and as a continuing security for the
payment or discharge of all monies obligations and liabilities hereby
covenanted to be paid or discharged by the Borrower:
(a) hereby grants demises charges and assigns unto the Lender the
hereditaments and premises described in the Schedule hereto
and all buildings fixed plant machinery and other things of
the nature of fixtures which are now or may at any time during
the continuance of the security be thereon; (i) to hold so
much thereof as is held in fee simple unto and to the use of
the Lender in fee simple;
(ii) to hold so much thereof as is held in fee farm unto
the Lender for 10,000 years without impeachment of
waste;
(iii) to hold so much thereof as is of leasehold tenure
unto the Lender for the residue of the term or terms
of years for which the same are held except the last
three days of such term without impeachment of waste
and;
(iv) so much thereof as consists of lands registered in
the Land Registry of Northern Ireland with all monies
lent or to be lent by the Lender to the Company with
interest thereon and the Company hereby assents to
the registration of the Charge hereby created as a
burden affecting the said lands;
(b) hereby charges by way of first fixed charge:
(i) all freehold leasehold and other immovable property
now or in the future belonging to the Borrower
together with all buildings, trade and other
fixtures, fixed plant and machinery of the Borrower
from time to time thereon;
(ii) all plant and machinery now or in the future
belonging to the Borrower other than fixed plant and
machinery;
(iii) all book debts and other debts now or in the future
due or owing
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to the Borrower;
(iv) all stocks shares and other securities now or in the
future belonging to the Borrower together with all
dividends and other rights deriving therefrom;
(v) the goodwill of the Borrower and its uncalled capital
for the time being;
(vi) all patents trade marks service marks designs and
other intellectual property rights choses in action
and claims and all fees, royalties and other rights
of every kind deriving therefrom now or in the future
belonging to the Borrower;
(c) hereby charges by way of first floating charge the whole of
the Borrower's undertaking and all its property and assets
whatsoever and wheresoever present and future other than the
property and assets from time to time effectively charged to
the Bank by way of legal mortgage or fixed charge by this
Debenture.
3.2 The Company as beneficial owner charges to the Lender and as continuing
security for the payment and discharge of the Secured Liabilities, by
way of floating charge the undertaking and all other property assets
and rights of the Company not effectively charged above both present
and future.
3.3 The Lender may by notice in writing to the Company convert the floating
charge contained in clause 3.2 into a fixed charge as regards any
Mortgaged Property specified in such notice at any time after this
Mortgage becomes enforceable. If without the prior written consent of
the Lender the Company charges pledges or otherwise encumbers (whether
by way of fixed or floating security) any of the Mortgaged Property
subject to a floating charge under this Mortgage or attempts to do so
or if any person levies or attempts to levy any distress execution
sequestration or other process against any of the Mortgaged Property,
the charge hereby created over the property or assets the subject
thereof shall automatically without notice operate and have effect as a
fixed charge instantly such event occurs.
3.4 The Company shall promptly on demand and at its own cost execute and do
all such assurances acts and things including without limitation
execute all transfers conveyances assignments and assurances of the
Mortgaged Property and give all notices orders and directions which the
Lender may require for perfecting or protecting this Mortgage or the
priority of this Mortgage or for facilitating the realisation of the
Mortgaged Property or the exercise of any of the rights vested in the
Lender or any Receiver.
4. DISCHARGE
If the Company shall pay to the Lender the Secured Liabilities in accordance
with the covenants contained in this Mortgage the Lender at the request and cost
of the Company will duly discharge this Mortgage.
5. RESTRICTIONS
The Company shall not without the prior written consent of the Lender:
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(a) create or permit to subsist or arise any Encumbrance or any right or option
on the Property or any part thereof. Subject as aforesaid, any mortgage of or
charge on the Property created by the Company (otherwise than in favour of the
Lender) shall be expressed to be subject to this Mortgage;
(b) sell, convey, assign or transfer the Property or any interest therein or
otherwise part with or dispose of any Property or assign or otherwise dispose of
any moneys payable to the Company in relation to the Property or agree to do any
of the foregoing;
(c) exercise any of the powers of leasing or agreeing to lease vested in or
conferred on mortgagors by common law or by statute or accept the surrender of
any lease, underlease or tenancy or agree to do any of the foregoing;
(d) part with or share possession or occupation of the Property or any part of
it or grant any tenancy or licence to occupy the Property or agree to do any of
the foregoing
6. COVENANTS BY THE COMPANY
The Company covenants with the Lender at all times during the continuance of
this security:
(a) Repair To keep the buildings installations and structures
------
(whether fully built or in course of construction) and all
fixtures and fittings therein or thereon and other erections
from time to time upon the Property in good and substantial
repair and condition (fair wear and tear excepted) (in the
case of plant and machinery) and fully protected from damage
or deterioration as a result of weather or malicious damage or
any other cause and to replace any fixtures and fittings which
have become worn out or otherwise unfit for use by others of a
like nature and equal value.
(b) Insurance
(i) to keep the said buildings installations and
structures and all fixtures and fittings situate
thereon and other erections insured against loss or
damage by the Insured Risks in their full replacement
value for the time being in such office or offices
and on such terms as the Lender shall approve and
including (if available on reasonable terms) a lender
protection clause whereby the insurance effected will
not be vitiated or avoidable as against a mortgagee
in the event of any misrepresentation act or neglect
or failure to disclose on the part of the Company or
the insured party (if not the Company) with the
Lender named as co-insured and co-payee
(ii) to maintain such insurance over the stock in trade
from to time upon the Property as the Lender shall
require;
(iii) to maintain in such office or offices as the Lender
shall approve such insurance in respect of employers'
liability public liability and liability under the
Defective Premises (NI) Order 1975 as the lender
shall reasonably require;
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(iv) punctually to pay all premiums (and other moneys) in
respect of such insurances and on demand to deliver
to the Lender the policy or policies of all such
insurances and the receipt for every such payment and
all moneys received under any policy or policies of
insurance whether maintained or effected by the
Company, the Lender or by a third party and whether
or not in pursuance of the Company's obligations
under this Mortgage shall be applied, at the Lender's
option, but subject to the rights of any lessor under
the Lease or the rights of any prior chargee either
in making good the loss or damage to the Property
(any deficiency being made good by the Company) or
towards the discharge of the Secured Liabilities and
any such moneys received by the Company shall be held
by the Company on trust for the Lender accordingly;
(v) to comply with the terms and conditions of any policy
of insurance on the Property or otherwise
contemplated by this Clause and not to do or omit to
do anything whereby any such insurance may become
void or voidable wholly or in part.
(c) Outgoings To pay when due all rents, rent charges (if any),
rates, taxes, charges, duties, assessments, impositions and
other outgoings whatsoever charged assessed levied or imposed
upon the Property or upon the owner or occupier thereof or
payable in respect of the Property.
(d) Covenants and stipulations To perform and observe all
covenants, restrictions, stipulations, provisions, regulations
and conditions affecting the Property or the use or enjoyment
of it.
(e) Alterations Not without the previous written consent of the
Lender not to be unreasonably withheld or delayed to demolish
pull down remove or permit or suffer to be demolished pulled
down or removed any building installation or structure for the
time being upon the Property or except in connection with the
renewal or replacement thereof any fixtures or erect or make
or suffer to be erected or made on the Property any building
installation structure or alteration or a change of use
thereof within the meaning of the Planning Order or otherwise
commit any waste upon or destroy or injure in any manner or by
any means lessen or suffer to be lessened to any material
extent the value of the Property.
(f) Development Where at the date of this Mortgage or at any time
during the continuance of this security the Property or any
part of it is intended to be developed or is in the course of
development, to proceed diligently and to the satisfaction of
the Lender and any competent authority with such development
in all respects in conformity with the planning and bye-law
consents therefor and to produce all plans and specifications
in relation to such development to the Lender for approval and
not to amend such plans and specifications in any manner which
might diminish the finished value (or increase the cost to a
material extent) without the Lender's approval not to be
unreasonably withheld or delayed.
(g) Planning
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(i) to comply in all respects with the Planning Order and
all licences, consents, permissions or conditions
granted or imposed thereunder;
(ii) not to make any application for planning permission
without the prior consent of the Lender and not to
enter into or agree to enter into any agreement under
Article 40 of the Planning Order such consent not to
be unreasonably withheld;
(iii) to comply with the requirements of any valid
enforcement notice or other notice or order (whether
issued under the Planning Order or any other statute)
within such time as may be specified therein or if no
time is specified within such period as may be
reasonably required by the Lender and to pay to the
Lender in reduction of the Secured Liabilities any
compensation received as a result of any such notice
or order.
(h) Right of entry To permit representatives of the Lender with or
without workmen or others to enter the Property at all
reasonable times to view the state of repair and condition of
the Property.
(i) Notices Within four days of receipt to produce to the Lender a
copy of any notice, order, direction, permission or proposal
affecting the Property or its use or value and to comply
immediately with the terms thereof or if the Lender so
requires or approves and at the Company's cost to make such
objections representations against or in respect of such
notice order proposal permission or consent as aforesaid as
the Lender may reasonably require.
(j) Information On request to produce to or provide for the Lender
such documents or information relating to the Property or its
development as the Lender may reasonably require.
(k) Statutes To comply (in all material respects) with all
obligations imposed under any present or future statute
regulation order or instrument or under any bye-laws
regulations or requirements of any competent authority or
approvals licences or consents relative to the Property or its
use or enjoyment.
(l) Leases Where the Property is leasehold or subject to any lease
agreement for lease or tenancy (referred to below as the
`occupational lease'):
(i) to perform and observe all covenants and conditions
contained in the Lease to be performed and observed
by the lessee and contained in any occupational lease
to be observed by the lessor;
(ii) to enforce the due observance and performance of all
obligations of all other parties to the Lease and any
occupational lease;
(iii) not to waive, release or vary any of the terms of the
Lease or any
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occupational lease, or to accept any surrender of any
occupational lease or exercise any power to determine
or extend the same or grant any consent or licence or
conclude any rent review under the same without, in
each case, the consent of the Lender which consent is
not to be unreasonably withheld or delayed in
circumstances in which the Company may not
unreasonably withhold or delay its consent;
(iv) if the Company shall receive any notice served under
section 14 of the CA or any proceedings shall be
commenced for forfeiture of the Lease or any superior
lease or the landlord or any superior landlord shall
attempt to re-enter under the provisions of the Lease
or any superior lease the Company shall give
immediate notice of such event in writing to the
Lender and at the request of the Lender and at the
expense of the Company take such steps as the Lender
may in its absolute reasonable discretion require.
(n) Indemnity To keep the Lender (and any Receiver appointed by
---------
the Lender) fully and effectively indemnified from and against
all actions, proceedings, costs, charges, claims, demands,
expenses and liabilities (including Value Added Tax and any
other taxes and/or legal and other professional fees)
whatsoever in respect of any breach or non-observance or non-
performance of any covenants obligations warranties or
undertakings on the part of the Company contained in this
Mortgage or the making good of any such breach or non-
observance or non-performance.
(o) Value Added Tax The Company covenants that it will not make an
---------------
election pursuant to paragraph 2 of Schedule 10 to the Value
Added Tax Act 1994 in relation to land and/or buildings
comprising the Property or will not revoke any election made
prior to the date of this Mortgage without the prior written
consent of the Lender such consent not to be unreasonably
withheld or delayed.
(p) Prior charges Duly and punctually to pay all sums payable in
-------------
respect of the Prior Charge (subject to any applicable
agreement or arrangement as to priorities) and from time to
time to produce to the Lender on demand the receipts for every
such payment.
(q) To comply (at its own cost) forthwith if required by the
Lender with any notice served on the Company pursuant to the
Waste and Contaminated Land (NI) Order 1997.
7. POWER TO REMEDY
7.1 If any building operations on the Property are not carried out in a
proper and workmanlike manner and with diligent progress to the reasonable
satisfaction of the Lender or its surveyor the Lender may (but shall not be
under any obligation so to do) serve a written notice on the Company advising it
of such failure and the Company shall have such period as the Lender may
reasonably specify to remedy the same failing which:
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(a) the Company shall if required by written notice from the
Lender within seven days assign to the Lender or as it may
direct all the benefit and interest of the Company in any
building contract sub-contract appointment of professional
advisers and such other contracts or agreements as the Company
may have relating to such building operations and will take or
procure such action as is necessary or desirable to provide
the Lender or the nominee of the Lender as aforesaid with
privity of contract with such parties or contractors with whom
the Company may have privity of contract and take all such
other steps as Lender may reasonably require to enable the
Lender to procure the completion of the said building
operations; and
(b) the Company shall permit the Lender at the Company's cost to
complete or procure the completion of the said building
operations
in both cases with power for the Lender and any persons authorised by the Lender
to enter upon the Property for any of the above purposes without thereby
becoming a mortgagee in possession.
7.2 If the Company fails to perform or observe any covenant or condition in
its part contained in this Mortgage, it shall be lawful for but not obligatory
upon the Lender in order to make good such failure in whole or in part and at
the Company's cost:
(a) to enter upon the Property and effect such repairs and other
works thereon as the Lender considers necessary; and/or
(b) to take such steps, give such notices, execute such works and
do such things as the Lender considers necessary to comply
with any requirements of or any notice, order, direction
permission or proposal, given, served or made under the
Planning Order or otherwise affecting or likely to affect the
Property or its value; and/or
(c) to insure and keep insured the Property in such amount and in
such manner as the Lender considers necessary; and/or
(d) to admit, settle, liquidate, compound or contest in such
manner as the Lender thinks fit any claim or liabilities in
relation to the Property whether or not the Lender is
expressly indemnified in this Mortgage against the same and to
make such payments and expend or debit on account such moneys
as the Lender considers necessary in that behalf but without
thereby becoming a mortgagee in possession.
8. ENFORCEMENT
Sections 20 and 24 of the CA shall not apply to this Mortgage and the statutory
powers of sale and appointing a Receiver under Sections 19 and 24 of the CA (as
varied and extended under this Mortgage) shall arise on the execution of this
Mortgage and shall become immediately exercisable without the restrictions
contained in the CA as to the giving of notice or otherwise at any time after
the Lender shall have demanded payment of any of the Secured Liabilities or
after any breach by the Company of any of the provisions of this Mortgage or the
occurrence of an Enforcement Event.
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9. APPOINTMENT AND POWERS OF RECEIVER
9.1 At any time after the Lender shall have demanded payment of any of the
Secured Liabilities or after any breach by the Company of any of the
provisions of this Mortgage or the occurrence of an Enforcement Event
or if requested by the Company, the Lender may appoint by writing any
person or persons (whether an officer of the Lender or not) to be a
Receiver of all or any part of the Mortgaged Property and where more
than one Receiver is appointed they may be given power to act either
jointly or severally.
9.2 The Lender may from time to time determine the remuneration of the
Receiver and may remove the Receiver and appoint another in his place.
9.3 The Receiver shall (so far as the law permits) be the agent of the
Company (who shall alone be personally liable for his acts, defaults,
omissions and remuneration) and shall have and be entitled to exercise
all powers conferred by the CA and the Insolvency (NI) Order 1989 in
the same way as if the Receiver had been duly appointed thereunder and
in particular by way of addition to, but without limiting any general
powers referred to above (and without prejudice to any of the Lender's
powers) the Receiver shall have power in the name of the Company or
otherwise to do the following things, namely:
(a) to take possession of collect and get in all or any part of
the Mortgaged Property and for that purpose to take any
proceedings as he shall think fit;
(b) to commence and/or complete any building operations on the
Property and to apply for and obtain any planning permissions,
building regulation approvals and any other permissions,
consents or licences in each case as he may in his absolute
discretion think fit;
(c) for the purpose of exercising any of the rights, powers,
authorities and discretions conferred on him by or pursuant to
this Mortgage or for any other purpose to borrow moneys from
the Lender or others on the security of the Mortgaged Property
or otherwise on such terms as he may in his absolute
discretion think fit;
(d) to provide such facilities and services for tenants and
generally to manage the Property in such a manner as he shall
think fit;
(e) if the Property is leasehold to vary the terms of or surrender
any lease and/or to take a new lease of it or of any part of
it on such terms as he shall think fit and so that any such
new lease shall ipso facto become charged to the Lender on the
terms of this Mortgage so far as applicable and to execute a
formal Mortgage over any such new lease in favour of the
Lender in such form as the Lender may reasonably require;
(f) to sell, transfer, assign, let or lease or concur in selling,
letting or leasing the Property or any part of it and the
grant of any rights over the Property (either by public
auction or private contract or otherwise) on such terms and
conditions and for such consideration including without
limitation
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shares, securities (of any other company) or other investments
payable at such time or times as he may in his absolute
discretion think fit;
(g) to vary the terms of, terminate, grant renewals of or accept
surrenders of leases or tenancies of the Property or any part
of it in such manner and for such terms with or without a
premium or other compensation or consideration including the
payment of money to a lessee or tenant on a surrender with
such rights relating to other parts of the Property and
containing such covenants on the part of the Company or
otherwise and generally on such terms and conditions as in his
absolute discretion he shall think fit;
(h) to make any arrangements or compromise which the Lender or he
shall think fit whether in relation to any lease of the
Property or to any covenants, conditions or restrictions
relating to the Property or without limitation otherwise;
(i) to make and effect all repairs and improvements;
(j) to enter into bonds, covenants, commitments, guarantees,
indemnities and like matters and to make all payments needed
to effect, maintain or satisfy the same;
(k) to settle adjust refer to arbitration compromise and arrange
any claims, accounts, disputes, questions and demands with or
by any person who is or claims to be a creditor of the Company
or relating in any way to the Mortgaged Property;
(l) to effect such insurances of or in connection with the
Property as he shall in his absolute discretion think fit;
(m) to appoint managers officers contractors and agents for the
aforesaid purposes upon such terms as to remuneration or
otherwise as he may determine;
(n) to do all such other acts and things as may be considered to
be incidental or conducive to any of the matters or powers
aforesaid and which he lawfully may or can do.
Provided nevertheless that the Receiver shall not be authorised to exercise any
of the above powers if and insofar and so long as the Lender shall in writing
exclude the same whether in or at the time of his appointment or subsequently.
9.4 Any moneys received by the Receiver in the exercise of his powers under
this Mortgage and under general law shall be (so far as the law
permits) applied by him as follows:
(a) in payment of the costs, charges and expenses of and
incidental to his appointment and the exercise of all or any
of his powers;
(b) in payment of his remuneration;
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(c) in payment to the Lender of moneys whether for principal,
interest or otherwise in arrear or accruing due under this
Mortgage
and any balance shall be paid to the person or persons entitled to it.
10. LENDER'S LIABILITY
10.1 In no circumstances shall the Lender be liable to account to the
Company as a mortgagee in possession or otherwise for any moneys not
actually received unconditionally and irrevocably by the Lender.
10.2 In no circumstances shall the Lender be liable to the Company or any
other person for any costs, charges, losses, damages, liabilities or
expenses arising from or connected with any realisation of the
Mortgaged Property or from any act, default, omission or misconduct of
the Lender its officers employees or agents in relation to the
Mortgaged Property or in connection with this Mortgage or the Loan
Agreement except to the extent that they shall be caused by the
Lender's own fraud negligence or wilful misconduct or that of its
officers or employees.
11. PROTECTION OF THIRD PARTIES
Any purchaser or any other person dealing with the Lender or any Receiver shall
not be concerned to enquire whether the Secured Liabilities have become payable
or whether any power which it or he is purporting to exercise has become
exercisable or whether any money is due under this Mortgage or as to the
application of any money paid, raised or borrowed or as to the propriety or
regularity of any sale by or other dealing with the Lender or such Receiver. All
the protection to purchasers contained in Sections 21 and 24 of the CA shall
apply to any person purchasing from or dealing with the Lender or any Receiver.
12. POWERS OF LEASING
The statutory powers of sale leasing and accepting surrenders exercisable by the
Lender are hereby extended so as to authorise the Lender whether in the name of
the Lender or in that of the Company to grant a lease or leases of the whole or
any part or parts of the Property with such rights relating to other parts of it
and containing such covenants on the part of the Company and generally on such
terms and conditions (including the payment of money to a lessee or tenant on a
surrender) and whether or not at a premium as the Lender (in its absolute
discretion) shall think fit.
13. POWER OF ATTORNEY
13.1 The Company hereby irrevocably appoints the Lender and the Receiver
jointly and also severally the Attorney and Attorneys of the Company
for the Company and in the name and on behalf of the Company and as the
act and deed of the Company or otherwise to sign seal and deliver
execute as a deed and otherwise perfect any deed assurance agreement
instrument or act which may be required or may be deemed proper for any
of the purposes referred to in or otherwise in connection with this
Mortgage. The Company ratifies and confirms and agrees to ratify and
confirm whatever any attorney appointed under this Clause properly
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does or purports to do in the exercise of all or any of the powers,
authorities and discretions granted or referred to in this Mortgage.
13.2 The power of attorney hereby granted is irrevocable and for value as
part of the security constituted by this Mortgage.
14. LENDER'S RIGHTS
14.1 At any time after this Mortgage becomes enforceable all powers of the
Receiver may be exercised by the Lender whether as attorney of the
Company or otherwise.
14.2 The Company agrees that at any time after this Mortgage becomes
enforceable:
(a) upon any sale or other disposition in exercise of the powers
contained or implied by this Mortgage the Lender may sever any
fixtures from the Property and sell the same apart from the
Property without taking possession of the Property and apply
the net proceeds of such sale in or towards satisfaction of
the Secured Liabilities;
(b) the Lender may as agent of the Company remove and sell any
chattels on the Property;
(c) it shall be lawful for the Lender to enter into any
arrangement or accept any composition in relation to the debts
hereby charged without the concurrence of the Company and any
such arrangement or composition shall be binding on the
Company.
15. COSTS AND EXPENSES
15.1 The Company shall, on demand and on a full indemnity basis, pay to the
Lender:
(a) the amount of all costs and expenses (including legal and
out-of-pocket expenses and any Value Added Tax on such costs
and expenses) which the Lender and any Receiver appointed by
the Lender incurs in connection with:
(i) the preparation, negotiation, execution and delivery
of this Mortgage and any related document;
(ii) any stamping or registration of this Mortgage;
(iii) any actual or proposed amendment of or waiver or
consent under or in connection with this Mortgage;
(iv) any discharge or release of this Mortgage;
(v) the preservation or exercise (or attempted
preservation or exercise) of any rights under or in
connection with, and the enforcement (or attempted
enforcement) of, this Mortgage and any related
document;
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(vi) obtaining payment of the Secured Liabilities;
(vii) dealing with or obtaining advice about any other
matter or question arising out of or in connection
with this Mortgage and any related document;
(b) all other moneys paid by the Lender in perfecting or otherwise
in connection with this Mortgage or in respect of the
Mortgaged Property including without limitation all moneys
expended by the Lender under clause 8 and all moneys advanced
or paid by the Lender to any Receiver for the purposes set out
in clause 10.
15.2 Such costs expenses and other moneys shall be recoverable from the
Company as a debt and shall bear interest accordingly at the Default
Rate and shall be charged on the Mortgaged Property.
16. CONTINUING SECURITY
16.1 This Mortgage shall be a continuing security to the Lender
notwithstanding any settlement of account or other matter or thing
whatsoever and shall be in addition to and shall not prejudice or
affect or be prejudiced or affected by any security relating to the
Mortgaged Property or to any other property or any other security which
the Lender may now or at any time in the future hold in respect of the
Secured Liabilities or any of them and shall continue in full force and
effect as a continuing security until discharged.
16.2 Section 17 of the CA shall not apply to this Mortgage.
17. NOTICES
17.1 Every notice demand or other communication under this Mortgage shall be
in writing and may be delivered personally or by letter or facsimile
despatched as follows:
(a) if to the Lender, to its address specified at the head of this
Mortgage marked for the attention of the Company Secretary
(b) if to the Company, at or to the offices of Messrs Johns Elliot
Solicitors marked for the attention of Mr Maurice Butler or to
such other address and/or facsimile number as may be notified
in accordance with this Clause by the relevant party to the
other party for such purpose.
17.2 Every notice demand or other communication shall be deemed to have been
received (if sent by post) 24 hours after despatch and (if delivered
personally) at the time of delivery or despatch if during normal
business hours in the place of intended receipt on a working day in
that place and otherwise at the opening of business in that place on
the next succeeding such working day.
17.3 Any notices demands or other communication as aforesaid to be given by
the
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Lender may be made by any person or firm acting as solicitor or
solicitors for the Lender.
18. TRANSFERS
18.1 This Mortgage is freely assignable or transferable by the Lender.
18.2 The Company may not assign or transfer any of its obligations under
this Mortgage or enter into any transaction which would result in any
of those obligations passing to another person.
18.3 The Lender may subject to the Lender obtaining the Company's written
consent not to be unreasonably withheld or delayed disclose to any
person related to the Lender and/or any person to whom it is proposing
to transfer or assign or has transferred or assigned this Mortgage any
information about the Company and any person connected or associated
with it. The Company represents and warrants that it has (and, subject
to any contrary requirement of law, will maintain) any necessary
authority by or on behalf of any such person to agree to the provisions
of this Clause.
19. MISCELLANEOUS
19.1 No delay or omission on the part of the Lender in exercising any right
or remedy under this Mortgage shall impair that right or remedy or
operate as or be taken to be a waiver of it; nor shall any single
partial or defective exercise of any such right or remedy preclude any
other or further exercise under this Mortgage of that or any other
right or remedy.
19.2 The Lender's rights under this Mortgage are cumulative and not
exclusive of any rights provided by law and may be exercised from time
to time and as often as the Lender deems expedient.
19.3 Any waiver by the Lender of any terms of this Mortgage, or any consent
or approval given by the Lender under it, shall only be effective if
given in writing and then only for the purpose and upon the terms and
conditions, if any, on which it is given.
19.4 If at any time any one or more of the provisions of this Mortgage is or
becomes illegal, invalid or unenforceable in any respect under any law
of any jurisdiction, neither the legality validity and enforceability
of the remaining provisions of this Mortgage nor the legality validity
or enforceability of such provision under the law of any other
jurisdiction shall be in any way affected or impaired as a result.
19.5 Any certificate or determination of the Lender as to the amount of the
Secured Liabilities shall, in the absence of manifest error, be
conclusive and binding on the Company.
19.6 The Company certifies that this Mortgage does not contravene any of the
provisions of its Memorandum and Articles of Association.
20. LAW AND JURISDICTION
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20.1 This Mortgage is governed by and shall be construed in accordance with
the law of Northern Ireland.
20.2 The Company irrevocably agrees for the exclusive benefit of the Lender
that the Courts of Northern Ireland shall have jurisdiction to hear and
determine any suit action or proceeding, and to settle any dispute,
which may arise out of or in connection with this Mortgage and for such
purposes hereby irrevocably submits to the jurisdiction of such courts.
20.3 Nothing contained in this Clause shall limit the right of the Lender to
take proceedings against the Company in any other court of competent
jurisdiction, nor shall the taking of any such proceedings in one or
more jurisdictions preclude the taking of proceedings in any other
jurisdiction, whether concurrently or not (unless precluded by
applicable law).
20.4 The Company irrevocably waives any objection which it may have now or
in the future to the Courts of Northern Ireland being nominated for the
purpose of this Clause on the ground of venue or otherwise and agrees
not to claim that any such court is not a convenient or appropriate
forum.
21. UNREGISTERED LAND
The Company hereby covenants with the Lender that:
(a) if and so long as the title to the Property or any part
thereof is not registered under the Land Registration Act (NI)
1970 no person shall during the continuance of this security
be registered under the said Act as proprietor of the Property
without the consent in writing of the Lender;
(b) upon any such registration the Company will forthwith deliver
to the Lender all Land Certificates relating to the Property
unless such certificates are deposited with the Land Registry.
22. REGISTERED LAND
The Company hereby applies to the Land Registrar for an inhibition in the
following terms to be entered on the register of the Company's title to the
Property: `Except under an order of the Registrar no disposition by the Owner of
the land is to be registered without the consent of the Owner for the time being
of this Mortgage.'
IN WITNESS whereof this Mortgage has been duly executed as a deed and is
intended to be and is delivered on the date first above written.
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<PAGE>
THE SCHEDULE
PART I
THE PROPERTY
None
PART II
THE LEASE(S)
None
EXECUTED AND DELIVERED AS A
DEED by the said UNICOMP
HOLDINGS (UK) LIMITED
acting by a director and
its secretary or two directors
________________________________
Director
________________________________
Secretary or Director
Company's Registered Number
SIGNED BY :
For and on behalf of Sx3 LIMITED :
in the presence of :
:
:
:
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<PAGE>
THIS DEBENTURE is dated
and made BETWEEN:
(1) ICS UNICOMP LIMITED, UNIBOL LIMITED, ICS COMPUTING GROUP LIMITED whose
registered offices are at Acre House, 11-15 William Road, London, NW1
3ER and AURORA UNICOMP LIMITED whose registered office is at Unicomp
House, Mallusk Road, Newtownabbey, BT36 8WU (the `Guarantor'); and
(2) SX3 LIMITED whose registered office is at 120 Malone Road, Belfast BT9
5HT (the `Lender')
WHEREAS
(a) By a Loan Agreement of even date the Lender agreed to make available a
loan of (Pounds)1,000,000 to UniComp Holdings (UK) Limited having its
registered office at Acre House 11-15 William Road London NW1 3ER
(hereinafter called "the Borrower") upon condition that the same be
secured (inter alia) by Guarantees by the Guarantor to be further
secured in the manner hereinafter set forth.
(b) The Guarantor and each of them have executed a Guarantee in pursuance
of the Loan Agreement.
(c) The Guarantor owns the freehold and leasehold premises, short
particulars of which are set forth in the Schedule hereto.
WITNESSES as follows:
References to the Guarantor shall mean each and every one of the Guarantor or
any one of them as the case may be.
1. COVENANT TO PAY
1.1 The Guarantor covenants when the same shall be or become due or, in the
absence of any specified due date, on demand to pay and discharge to
the Lender all monies obligations and liabilities whether principal
interest or
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otherwise which may now or at any time in the future be due owing or
incurred by the Borrower to the Lender whether actual or contingent and
whether alone severally or jointly as principal guarantor surety or
otherwise and in whatever name or style and whether on any current or
other account or in any other manner together with interest charges and
other expenses so that interest shall be calculated and compounded in
accordance with the usual practice of the Bank of Ireland from time to
time as well after as before any demand made or judgment obtained
hereunder under the terms of the Loan Agreement hereinbefore referred
to.
2. CHARGE
2.1 The Guarantor as beneficial owner and as a continuing security for the
payment or discharge of all monies obligations and liabilities hereby
covenanted to be paid or discharged by the Guarantor:
(a) hereby grants demises charges and assigns unto the Lender the
hereditaments and premises described in the Schedule hereto
and all buildings fixed plant machinery and other things of
the nature of fixtures which are now or may at any time during
the continuance of the security be thereon;
(i) to hold so much thereof as is held in fee simple unto
and to the use of the Lender in fee simple;
(ii) to hold so much thereof as is held in fee farm unto
the Lender for 10,000 years without impeachment of
waste;
(iii) to hold so much thereof as is of leasehold tenure
unto the Lender for the residue of the term or terms
of years for which the same are held except the last
three days of such term without impeachment of waste
and;
(iv) so much thereof as consists of lands registered in
the Land Registry of Northern Ireland with all monies
lent or to be lent by the Lender to the Company with
interest thereon and the Company hereby assents to
the registration of the Charge hereby created as a
burden affecting the said lands;
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<PAGE>
(b) hereby charges by way of first fixed charge:
(i) all freehold leasehold and other immovable property
now or in the future belonging to the Guarantor
together with all buildings, trade and other
fixtures, fixed plant and machinery of the Guarantor
from time to time thereon;
(ii) all plant and machinery now or in the future
belonging to the Guarantor other than fixed plant and
machinery;
(iii) all book debts and other debts now or in the future
due or owing to the Guarantor;
(iv) all stocks shares and other securities now or in the
future belonging to the Guarantor together with all
dividends and other rights deriving therefrom;
(v) the goodwill of the Guarantor and its uncalled
capital for the time being;
(vi) all patents trade marks service marks designs and
other intellectual property rights choses in action
and claims and all fees, royalties and other rights
of every kind deriving therefrom now or in the future
belonging to the Guarantor;
(c) hereby charges by way of first floating charge the whole of
the Guarantor's undertaking and all its property and assets
whatsoever and wheresoever present and future other than the
property and assets from time to time effectively charged to
the Lender by way of legal mortgage or fixed charge by this
Debenture.
2.2 The Lender may convert the floating charge at any time by notice in
writing to the Guarantor into a fixed charge as regards all the
property and assets which for the time being are the subject of such
floating charge or, as the case may be, such of the said property and
assets as are specified by such notice.
2.3 The security from time to time constituted by or pursuant to this
Debenture shall be in addition to and shall not prejudice determine or
affect any other security which the Lender may from time to time hold
for or in respect of all or any part of the monies obligations and
liabilities hereby secured. No prior security held
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<PAGE>
by the Lender over the property charged by this Debenture or any part
of it shall merge in the security created hereby or pursuant hereto
which will remain in force and effect as a continuing security until
discharged by the Lender.
3. RESTRICTIONS ON DEALING
3.1 The Guarantor shall not without the prior written consent of the
Lender:
(a) create or permit to subsist any mortgage charge pledge
hypothecation lien (other than a lien arising by operation of
law) or other security interest on any of its assets ranking
in priority or pari passu with the fixed and floating charges
hereby created other than this Debenture;
(b) sell transfer lease lend or otherwise dispose of the whole or
any part of its undertaking or (save in the normal course of
trading at not less than market value) of its assets or enter
into any agreement or grant any option for any such sale
transfer lease loan or other disposal;
(c) part with possession of any freehold or leasehold property
grant or agree to grant any option or any licence tenancy or
other right of occupation to any person or exercise the powers
of leasing or agreeing to lease or of accepting or agreeing to
accept surrenders conferred by Section 18 of the Conveyancing
Act 1881 and Section 3 of the Conveyancing Act 1911 provided
that such restrictions shall not be construed as a limitation
on the powers of any receiver appointed under this Debenture
and being an agent of the Guarantor and the Lender may grant
or accept surrenders of leases without restriction;
(d) pull down or remove or redevelop or make any material
alteration to the whole or any part of any buildings or sever
unfix or remove any fixtures or remove any plant or machinery
belonging to or in use by the Guarantor except for the purpose
of effecting repairs or replacing the same.
4. COVENANTS BY THE GUARANTOR
4.1 The Guarantor shall:
(a) keep all buildings and all plant machinery fixtures and
fittings in good
4
<PAGE>
repair and condition and permit any person or persons
nominated by the Lender free access at all reasonable times to
view the state and condition thereof;
(b) insure and keep insured such of its property as is insurable
with such insurer and against such risks and in such amounts
and otherwise in such terms as the Lender may require and will
maintain such other insurances as are normally maintained by
prudent companies carrying on similar businesses with the
interest of the Lender noted upon all policies of such
insurance or, if the Lender shall require, in the joint names
of the Guarantor and the Lender and will produce or deposit
with the Lender all such policies and receipts for all premium
and other payments necessary for effecting and maintaining
such insurances;
(c) subject to any rights of a lessor apply any insurance proceeds
in making good the loss or damage or at the Lender's option in
or towards the discharge of the monies obligations and
liabilities secured by this Debenture;
(d) punctually pay all rents taxes duties assessments and other
outgoings and observe and perform all restrictive and other
covenants under which any of the property subject to this
Debenture is held;
(e) deal with its book or other debts and all licence fees,
royalties and other monies deriving from its intellectual
property in accordance with any directions from time to time
given in writing by the Lender and in default of and subject
to any such directions not release factor sell at discount
charge assign or otherwise deal with such debts, licence fees,
royalties or other monies otherwise than by getting in and
paying the same into such account;
(f) permit to furnish directly to the Lender from time to time
upon request full statements and particulars of all the
Guarantor's accounts with the and such other financial
statements information respecting the assets and liabilities
of the Guarantor as are from time to time available to the
Lender;
(g) subject to the rights of any prior mortgagee deposit with the
Lender all deeds certificates and documents constituting or
evidencing title to the
5
<PAGE>
property or any part thereof charged by this Debenture and all
insurance policies;
(h) comply with the provisions of all present or future statutes
and directives and every notice order or direction made under
any of the foregoing;
(i) provide the Lender with all financial and other information
with respect to the assets, liabilities and affairs of the
Guarantor and its subsidiaries and associated companies (if
any) that the Lender may from time to time require.
4.2 If the Guarantor shall fail to satisfy the Lender that it has performed
any of its obligations under clause 4.1 then the Lender may take such
steps as it considers appropriate to procure the performance of such
obligation and shall not thereby be deemed to be a mortgagee in
possession and the monies expended by the Lender shall be reimbursed by
the Guarantor on demand and until so reimbursed shall carry interest as
mentioned in clause 1 from the date of payment to the date of
reimbursement.
5. ENFORCEMENT
5.1 This Debenture shall become enforceable:
(a) if any of the monies obligations and liabilities secured by
this Debenture shall not be paid or discharged by the
Guarantor in accordance with clause 1; or
(b) if the Guarantor shall be in breach of any provision of this
Debenture or of any agreement containing any terms and
conditions of or applicable to the monies obligations and
liabilities secured by this Debenture; or
(c) upon the presentation of a petition for the winding up of the
Guarantor or the making of an order for the winding up of the
Guarantor or the passing by the Guarantor of a resolution for
voluntary winding up; or
(d) if an encumbrancer shall take possession of or a receiver
shall be appointed over or any secured creditor of the
Guarantor shall seek to enforce his security in respect of all
or any of the property or assets charged by this Debenture; or
(e) if a petition shall be presented for an administration order
in relation to
6
<PAGE>
the Guarantor; or
(f) if the Guarantor shall enter into any composition or
arrangement for the benefit of its creditors; or
(g) any other event shall take place which in the opinion of the
Lender puts in jeopardy all or any part of the security
created by this Debenture.
5.2 Section 20 of the Conveyancing Act 1881 shall not apply and the
statutory power of sale and all other powers under that or any other
Act as varied or extended by this Debenture shall arise on and be
exercisable at any time after the Lender shall have demanded the
payment or discharge by the Guarantor of all or any of the monies
obligations and liabilities secured by this Debenture.
5.3 Section 17 of the Conveyancing Act 1881 dealing with the consolidation
of mortgages shall not apply to this Debenture.
6. RECEIVER
6.1 At any time after this Debenture has become enforceable or if the
Guarantor so requests in writing the Lender may without further notice
to the Guarantor appoint by writing under hand or under seal any one or
more persons either singly jointly severally or jointly and severally
to be a receiver, receiver and manager or administrative receiver (each
a `Receiver') of all or any part of the property charged by this
Debenture and either at the time or appointment or any time thereafter
may fix his or their remuneration and except as otherwise required by
statute may remove any such Receiver and appoint another or others in
his or their place.
6.2 Any Receiver shall be the agent of the Guarantor which shall be solely
responsible for his acts and defaults and the payment of his
remuneration.
6.3 Any Receiver shall subject to any liabilities or restrictions expressed
in the deed or instrument appointing him have all the powers conferred
by the Conveyancing Act 1881 to 1911 and the Insolvency (NI) Order 1989
on mortgagors mortgagees
7
<PAGE>
in possession (but without liability as such) receivers administrative
receivers and administrators appointed under those Acts which in the
case of joint receivers may be exercised either jointly or severally.
In addition, but without prejudice to the generality of the foregoing
the Receiver shall have power (in the name of the Guarantor or
otherwise and in such manner and on such terms and conditions as he
shall think fit) to:
(a) take possession of collect and get in all or any part of the
property in respect of which he is appointed and for that
purpose to take any proceedings;
(b) carry on or concur in carrying on the business of the
Guarantor and to raise money on the security of any property
charged by this Debenture;
(c) purchase or acquire any land and purchase, acquire and grant
any interest in or right over land;
(d) sell or concur in selling let or concur in letting and
terminate or accept surrenders of leases or tenancies of any
of the property charged by this Debenture and to carry any
such transactions into effect;
(e) sell, assign let or otherwise dispose of or concur in selling,
assigning, letting or otherwise disposing of all or any of the
debts and any other property in respect of which he is
appointed;
(f) make any arrangement or compromise between the Guarantor and
any other person which he may think expedient;
(g) make and effect all repairs improvement and insurances;
(h) purchase materials tools equipment goods or supplies;
(i) call up any uncalled capital of the Guarantor with all the
powers conferred by the Articles of Association of the
Guarantor in relation to calls;
(j) employ engage and appoint managers and other employees and
professional advisers;
(k) do all such other acts and things as may be considered to be
incidental or conducive to any other matters or powers
aforesaid or to the realisation of the security constituted by
this Debenture and which he lawfully may or can do.
7. APPLICATION OF PROCEEDS
8
<PAGE>
7.1 Any monies received by the Lender or any Receiver shall subject to the
repayment of any claims having priority to the charges created by this
Debenture be applied in the following order but without prejudice to
the right of the Lender to recover any shortfall from the Guarantor:
(a) in the payment of all costs charges and expenses of and
incidental to the appointment of the Receiver and the exercise
of all or any of his powers and of all outgoings paid by him;
(b) in the payment of the Receiver's remuneration;
(c) in or towards the satisfaction of the monies obligations and
liabilities secured by this Debenture in such order as the
Lender in its absolute discretion thinks fit;
(d) in payment of the surplus (if any) to the person or persons
entitled to it.
8. PROTECTION OF THIRD PARTIES
8.1 No person dealing with a Receiver or the Lender shall be concerned to
enquire whether any power which he or it is purporting to exercise has
become exercisable or whether any money is due under this Debenture or
as to the application of any money paid raised or borrowed or as to the
propriety or regularity of any sale by or other dealing with such
Receiver or the Lender. All the protection to purchasers contained in
Section 21 of the Conveyancing Act 1881 and Section 5 of the
Conveyancing Act 1911 and Section 24 of the Conveyancing Act 1881 shall
apply to any person purchasing from or dealing with a Receiver or the
Lender.
9. ENTRY INTO POSSESSION
9.1 If the Lender or any Receiver shall enter into possession of the
property hereby charged or any part thereof it or he may from time to
time and at any time go out of such possession. Neither the Lender nor
any Receiver shall in any circumstances (either by reason of any entry
into or taking of possession of any such property or for any other
reason and whether as mortgagee in possession
9
<PAGE>
or on any other basis) be liable to account to the Guarantor for
anything except its or his actual receipts or be liable to the
Guarantor for any loss or damage arising from any realisation of the
property hereby charged or from any act default or omission in relation
thereto.
10. POWER OF ATTORNEY
10.1 The Guarantor irrevocably appoints the Lender any Receiver and any
person nominated by the Lender jointly and also severally to be the
attorney of the Guarantor with the power of substitution and in its
name and otherwise on its behalf and as its act and deed to sign or
execute all deeds instruments and documents which the Lender or any
Receiver may require or deem proper for any of the purposes of or which
the Guarantor ought to do under this Debenture. The Guarantor agrees to
ratify and confirm anything such attorney shall lawfully and properly
do.
11. CURRENCY INDEMNITY
11.1 For the purpose of or pending the discharge of any of the monies
obligations and liabilities secured by this Debenture the Lender may
convert any monies received recovered or realised by the Lender under
this Debenture (including the proceeds of any previous conversion) from
their existing currency into such other currency as the Lender may
think fit and any such conversion shall be effected at the Lender's
then prevailing spot selling rate of exchange for such other currency
against the existing currency. As a separate and independent obligation
the Guarantor agrees to indemnify and hold harmless the Lender against
any shortfall between any amount received or recovered by it in respect
of any payment due under this Debenture and converted in accordance
with the clause into the currency in which such amount was payable and
the amount in such currency which was due and payable to the Lender
under this Debenture.
12. PRIOR CHARGES
12.1 If there is any encumbrance over any of the property charged by this
Debenture
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which ranks in priority to this Debenture and any proceedings or steps
are taken to exercise or enforce any powers or remedies conferred by
such prior encumbrance the Lender or any Receiver appointed under this
Debenture in respect of such property may (but without prejudice to any
rights the Receiver may have under the Insolvency (NI) Order 1989)
redeem such prior encumbrance or procure its transfer to itself and may
settle and pass the accounts of any prior mortgagee chargee or
encumbrancer. Any account so settled and passed shall be conclusive and
binding on the Guarantor and all the principal interest costs charges
and expenses of and incidental to such redemption or transfer shall be
secured on the property charged by this Debenture and all the powers
conferred by any prior encumbrance upon the encumbrancer or any
receiver thereunder shall be exercisable by the Lender or a Receiver in
like manner as if the same were expressly included in this Debenture.
13. FURTHER ASSURANCE
13.1 The Guarantor shall whenever requested by the Lender immediately
execute and sign all such deeds and documents and do all such things as
the Lender may require at the Guarantor's cost over any property or
assets specified by the Lender for the purpose of perfecting or more
effectively providing security to the Lender for the payment and
discharge of the monies obligations and liabilities secured by this
Debenture.
14. COSTS AND INDEMNITY
14.1 All costs charges and expenses properly incurred by the Lender in
relation to this Debenture or the monies and liabilities hereby secured
shall be reimbursed by the Guarantor to the Lender on demand on a full
indemnity basis and until so reimbursed shall carry interest as
mentioned in clause 1 from the date of payment to the date of
reimbursement and be secured on the property charged by this Debenture.
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14.2 The Lender and every Receiver attorney or other person appointed by the
Lender under this Debenture and their respective employees shall be
entitled to be indemnified on a full indemnity basis out of the
property charged by this Debenture in respect of all liabilities and
expenses properly incurred by any of them in or directly or indirectly
as a result of the exercise or purported exercise of any of the powers
authorities or discretions vested in them under this Debenture and
against all actions proceedings losses costs claims and demands in
respect of any matter or thing done or omitted in any way relating to
the property charged by this Debenture and the Lender and any such
Receiver may retain and pay all sums in respect of the same out of the
monies received under the powers conferred by this Debenture.
15. MISCELLANEOUS
15.1 The Lender may without discharging or in any way affecting the security
created by this Debenture or any remedy of the Lender grant time or
other indulgence or abstain from exercising or enforcing any remedies
securities guarantees or other rights which it may now or in the future
have from or against the Guarantor and may make any arrangement
variation or release with any person or persons without prejudice
either to this Debenture or the liability of the Guarantor for the
monies obligations and liabilities secured by this Debenture.
15.2 The Lender shall have a full and unfettered right to assign the whole
or any part of the benefit of this Debenture and the expression `the
Lender' shall include its successors and assigns and the Lender shall
be entitled to disclose any information to any actual or prospective
assignee successor or participant.
15.3 The provisions of this Debenture shall be severable and if at any time
any one or more such provisions is or becomes invalid illegal or
unenforceable the validity legality and enforceability of the remaining
provisions shall not in any way be impaired.
15.4 The rights and remedies of the Lender provided by this Debenture are
12
<PAGE>
cumulative and are not exclusive of any rights powers or remedies
provided by law and may be exercised from time to time and as often as
the Lender may deem expedient.
15.5 Any reference in this Debenture to any statute or any section of any
statute shall be deemed to include reference to any statutory
modification or re-enactment thereof for the time being in force.
16. REPRESENTATIONS WARRANTIES AND COVENANTS BY THE GUARANTOR
16.1 The Guarantor represents and warrants to the Lender and undertakes
that:-
(a) the Guarantor has acquired and maintained all environmental
licences required by its use or occupation of the properties
referred to in the Schedule and the premises or for the
conduct of its business as it has been and is currently being
carried on and has complied with all terms and conditions
relating thereto and with all other applicable environmental
laws which would have a material adverse affect on the
Guarantor's ability to perform its obligations under this
Debenture and has done or permitted any acts or omission
whereby any such environmental licence would be liable to be
varied or revoked;
(b) there has been no discharge spillage release or emission of
any prescribed dangerous noxious or offensive substance or any
controlled waste on into or from any of the properties or
premises, so far as the Guarantor is aware, any premises
adjoining any of them and no such substances or any controlled
waste have been stored or disposed of on or in any of the
properties or premises or, insofar as the Guarantor is aware,
any premises adjoining them except in accordance with the
requirements of the applicable environmental laws;
(c) the Guarantor is not in breach of and has not incurred or
become subject to any civil of criminal liability under any
environmental law or the terms of any environmental licence
which it would have a material adverse affect on the
Guarantor's ability to perform its obligations under this
Debenture;
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<PAGE>
(d) the Guarantor has obtained and maintained all such insurance
policies as would be maintained by prudent companies carrying
on business of the type carried on by the Guarantor at all
relevant times and has complied in all material respects with
the terms and conditions of such policies.
17. NOTICES
17.1 Any demand or notice under this Debenture shall be in writing signed by
any manager or officer of the Lender or of any branch thereof and may
be served personally on any director or the secretary of the Guarantor
or may be sent by post or facsimile or may be delivered to the
registered office of the Guarantor or its last known place of business.
If such demand or notice is sent by post it shall be deemed to have
been received on the day following the day on which it was posted and
shall be effective notwithstanding that it was not in fact delivered or
was returned undelivered. If sent by facsimile it shall be deemed to
have been received (whether or not actually received) at the time of
dispatch.
18. GOVERNING LAW AND JURISDICTION
18.1 This Debenture shall be governed by and construed in accordance with
the laws of Northern Ireland and the Guarantor irrevocably submits to
the non-exclusive jurisdiction of the Northern Ireland Courts.
19. LAND REGISTRY
19.1 The Guarantor certifies that this Debenture does not contravene its
Memorandum and Articles of Association and has been executed in
accordance therewith.
20. The Guarantor hereby declares that the Guarantor shall hold all the
Guarantor's estate and interest from time to time in the lands and
premises and hereditaments specifically mortgaged or charged herein and
shall as from the date of crystallisation of any floating charge hold
all its estate and interest from
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time to time in the lands premises and hereditaments therein comprised
whether in respect of freehold or leasehold reversions or otherwise
howsoever upon trust to convey assign or otherwise deal with the same
in such manner and to such person (whether to the Lender or its nominee
or otherwise) as the Lender its successors or assigns shall direct and
declares that it shall be lawful for the Lender during the continuance
of this security to remove the Company or any other person from being
trustee and to appoint the Lender or any person a new trustee or new
trustees of the said property and thereupon to make a declaration
vesting all the estate and interest of the Company in the said property
in such new trustee or trustees and so (but without prejudice to the
generality of the foregoing (that any such new trustee or trustees may
be any receiver or receivers of the said property appointed by the
Lender under the powers therein contained.
IN WITNESS whereof the parties hereto have caused their respective Common and
Corporate Seals to be hereunto affixed the day and year first herein written.
SCHEDULE
PREMISES OWNED BY:
(1) ICS Unicomp Ltd
Site 34 Sydenham Business Park
205 Airport Road West
Belfast Harbour Estate
Belfast
BT3 9ED
(2) Unibol Limited
Unicomp House
Victoria Business Park
West Bank Road
Belfast
15
<PAGE>
BT12 9UB
and
Warehouse
3 Ballynure Road
Ballynure
Co. Antrim
EXECUTED as a Deed by ICS UNICOMP :
LIMITED in the presence of: :
:
____________________ :
Director :
:
____________________ :
Director/Secretary :
EXECUTED as a Deed by UNIBOL LIMITED :
in the presence of: :
:
____________________ :
Director :
:
____________________ :
Director/Secretary :
EXECUTED as a Deed by :
ICS COMPUTING GROUP LIMITED in the :
presence of: :
16
<PAGE>
:
____________________ :
Director :
:
____________________ :
Director/Secretary :
EXECUTED as a Deed by :
AURORA UNICOMP LIMITED in the :
presence of: :
:
____________________ :
Director :
:
____________________ :
Director/Secretary :
Signed by :
FOR AND ON BEHALF OF SX3 LIMITED :
IN THE PRESENCE OF: :
17
<PAGE>
DATED THIS DAY OF 199
ICS Unicomp Limited, Unibol Limited, ICS Computing Group Limited
and
Aurora Unicomp Limited
-to-
SX3 Limited
-----------------------------------------------
FIXED and FLOATING CHARGE and DEBENTURE
----------------------------------------------
Messrs Carson & McDowell
Solicitors
Murray House
4/5 Murray Street
BELFAST
BT1 6HS
18
<PAGE>
THIS GUARANTEE AND INDEMNITY is made BY DEED the
BY EACH OF:
THE COMPANIES whose name and registered office is set out in the First Schedule
(hereinafter together referred to as the `Guarantors')
IN FAVOUR OF
SX3 LIMITED (the `Creditor')
WHEREAS the Guarantors have requested and the Creditor has agreed to grant
and/or continue accommodation to Unicomp Holdings (UK) Limited upon the
Guarantors executing a Guarantee in favour of the Creditor on the terms and
conditions hereinafter appearing.
NOW THIS DEED WITNESSETH as follows:
1 INTERPRETATION
1.1 Unless the context otherwise requires or unless otherwise defined in this
Guarantee, words and expressions shall have the same meanings that are ascribed
to them in the Facility Documents.
1.2 In this Guarantee:
`Loan Agreement' means the Loan Agreement of even date and made between (1)
Sx3 Limited and (2) Unicomp Holdings (UK) Limited and any variation
amendment or extension thereof or supplement thereto from time to time in
force.
`Interest Rate' means the rates of interest referred to in the Loan
Agreement.
1
<PAGE>
`Principal Debtor' means Unicomp Holdings (UK) Limited.
1.3 In this Guarantee:
(a) references to this Guarantee are to include the indemnity in clause
3.3;
(b) references to Clauses are to be construed as references to the clauses
of this Guarantee and references to this Guarantee include the
Schedule;
(c) references to this Guarantee and to any provisions of this Guarantee
or to any other document or agreement shall be construed as references
to this Guarantee or that document or agreement in force for the time
being and as amended, varied, supplemented, substituted or novated
from time to time;
(d) words importing the singular are to include the plural and vice versa;
(e) references to a person are to be construed to include references to a
corporation, firm, company, partnership, joint venture, unincorporated
body of persons, individual or any state or any agency of a state,
whether or not a separate legal entity;
(f) references to any person are to be construed to include that person's
assigns or transferees or successors in title, whether direct or
indirect;
(g) references to any statutory provision means that statutory provision
as amended, supplemented, re-enacted or replaced from time to time
(whether before or after the date of this Guarantee) and are to
include any orders, regulations, instruments or other subordinate
legislation made under the relevant statutory provision;
(h) the words `other' and `otherwise' are not to be construed ejusdem
generis with any foregoing words where a wider construction is
possible;
2
<PAGE>
(i) references to liability are to include any liability whether actual,
contingent, present or future;
(j) references to this Guarantee are references to the guarantee and
indemnity given by each of the Guarantors under this Guarantee; and
(k) clause headings are for ease of reference only and are not to affect
the interpretation of this Guarantee.
2 REPRESENTATIONS AND WARRANTIES BY EACH OF THE GUARANTORS
2.1 Each of the Guarantors hereby represents and warrants to the creditor that:
(a) it is duly incorporated and is a validly existing company under the
laws of its place of incorporation, has the capacity to sue or be sued
in its own name and has power to carry on its business as now being
conducted and to own its property and other assets;
(b) it has full power and authority to execute, deliver and perform its
obligations under this Guarantee and no limitation on its powers will
be exceeded as a result of its entering into this Guarantee;
(c) the execution, delivery and performance by it of this Guarantee and
the performance of its obligations under this Guarantee have been duly
authorised by all necessary corporate action and do not contravene or
conflict with:
(i) its memorandum and articles of association or other equivalent
constitutional documents;
(ii) any existing law, statute, rule or regulation or any judgment,
decree or permit to which it is subject; and
3
<PAGE>
(iii) the terms of any agreement or other document to which it is a
party or which is binding upon it or any of its assets; and
(d) this Guarantee is its legal, valid and binding obligation and is
enforceable against it in accordance with its terms.
2.2 Each of the Guarantors acknowledges that the Creditor has accepted this
Guarantee in full reliance on the representations and warranties set out in this
Clause 2.
3 GUARANTEE
3.1 Each of the Guarantors irrevocably and unconditionally undertakes the
obligations and liabilities set out in clause 3.2 and clause 3.3.
3.2 Each of the Guarantors irrevocably and unconditionally guarantees:
(a) to pay to the Creditor on demand, and in the currency in which the
same falls due for payment, all monies and liabilities which are now
or at any time hereafter shall have been advanced to, become due,
owing or incurred by each or any of the Principal Debtor to or in
favour of the Creditor under or in connection with any of the Loan
Agreement; and
(b) the due and punctual observance, performance and discharge by the
Principal Debtor of all of its obligations and liabilities under the
Loan Agreement;
3.3 Each of the Guarantors as principal obligor and as a separate and
independent obligation and liability from its obligations and liabilities under
clause 3.2, irrevocably and unconditionally agrees to indemnify the Creditor in
full on demand against any of losses, costs, and expenses suffered or incurred
by the Creditor arising from or in connection with any of:
4
<PAGE>
(a) the Creditor's making available any of the facilities under the Loan
Agreement;
(b) the Creditor's entering into the Loan Agreement;
(c) any of the provisions of any of the Loan Agreement being or becoming
void, voidable, invalid or unenforceable; or
(d) the failure of the Principal Debtor fully and promptly to perform and
discharge any of its obligations and liabilities under the Loan
Agreement.
3.4 Each of the Guarantors hereby agrees to indemnify and keep indemnified the
Creditor (to the extent not indemnified under the Loan Agreement or as otherwise
indemnified under this Guarantee) on demand by the Creditor against all losses,
actions, claims, costs, charges, expenses and liabilities suffered or incurred
by the Creditor in relation to this Guarantee (including the costs, charges and
expenses incurred in the enforcement of any of the provisions of this Guarantee
or occasioned by any breach by any of the Guarantors of any of its obligations
to the Creditor under this Guarantee).
4 CREDITOR PROTECTIONS
4.1 Each of the Guarantors acknowledges and agrees that this Guarantee is and
at all times shall be a continuing security and shall extend to cover the
ultimate balance due at any time from each and any of the Principal Debtor to
the Creditor under or in respect of the Loan Agreement and any of the
transactions contemplated thereby.
4.2 Each of the Guarantors acknowledges and agrees that none of its liabilities
under this Guarantee shall be reduced, discharged or otherwise adversely
affected by:
(a) any variation, extension, discharge, compromise, dealing with,
exchange or renewal of any right or remedy which the Creditor may now
or hereafter have from or against the Principal Debtor and any other
person
5
<PAGE>
in respect of any of the obligations and liabilities of the Principal
Debtor and any other person under and in respect of any of the Loan
Agreement;
(b) any act or omission by the Creditor or any other person in taking up,
perfecting or enforcing any security or guarantee from or against the
Principal Debtor and any other person;
(c) any termination, amendment, variation, novation or supplement of or to
any of the Loan Agreement;
(d) any grant of time, indulgence, waiver or concession to the Principal
Debtor and any other person;
(e) any of the administration, insolvency, bankruptcy, liquidation,
winding-up, incapacity, limitation, disability, the discharge by
operation of law and any change in the constitution, name and style of
the Principal Debtor and any other person;
(f) any invalidity, illegality, unenforceability, irregularity or
frustration of any actual or purported obligations of the Principal
Debtor and any other person;
(g) any claim or enforcement of payment from the Principal Debtor and any
other person; or
(h) any act or omission which would not have discharged or affected the
liability of any of the Guarantors had it been a principal debtor
instead of guarantor or indemnitor or by anything done or omitted by
any person which but for this provision might operate to exonerate or
discharge or otherwise reduce or extinguish any of the Guarantors'
liability under this Guarantee.
4.3 PRIMARY OBLIGATION
6
<PAGE>
(a) The obligations and liabilities expressed to be undertaken by each of
the Guarantors under this Guarantee are those of primary obligor and
not merely as a surety.
(b) The Creditor shall not be obliged before taking steps to enforce any
of its rights and remedies under this Guarantee:
(i) to take action or obtain judgment in any court against the
Principal Debtor and any other person;
(ii) to make or file any claim in a bankruptcy, liquidation
administration or insolvency of the Principal Debtor and any
other person; or
(iii) to make demand, enforce or seek to enforce any claim, right or
remedy against the Principal Debtor and any other person.
4.4 NO SECURITY
(a) Each of the Guarantors warrants to the Creditor that it has not taken
or received, and agrees not to take, exercise or receive the benefit
of any security or other right or benefit (whether by set-off,
counterclaim, subrogation, indemnity, proof in liquidation or
otherwise and whether from contribution or otherwise, all together
`Rights') from or against the Principal Debtor and any other person in
respect of any liability of or payment by any of the Guarantors under
this Guarantee or otherwise in connection with this Guarantee.
(b) If any of such Rights is taken, exercised or received by any
Guarantor, each Guarantor declares that its Rights and all monies at
any time received or held by it in respect of such Rights shall be
held by it on trust for the Creditor for application in or towards the
discharge of the liabilities of that Guarantor to the Creditor under
this Guarantee.
7
<PAGE>
(c) Each of the Guarantors agrees that all other Rights and all monies
from time to time held on trust by it for the Creditor under or
pursuant to Clause 4.4(b) shall be transferred, assigned or, as the
case may be, paid to the Creditor, promptly following the creditor's
demand.
4.5 This Guarantee shall be in addition to and shall not affect or be affected
by or merge with any other judgment, security, right or remedy obtained or held
by the Creditor from time to time for the discharge and performance of any of
the liabilities and obligations of each of the Principal Debtors to the
Creditor.
5 INTEREST
(a) Each of the Guarantors agrees to pay interest to the Creditor at the
Interest Rate on all sums demanded under this Guarantee from the date
of the Creditor's demand under this Guarantee or, if earlier, the date
on which the relevant damages, losses, costs or expenses arose in
respect of which such demand has been made, in each case until, but
excluding the date of actual payment.
(b) Each of the Guarantors agrees to pay interest to the Creditor at the
Interest Rate after as well as before judgment.
All such interest shall accrue on a day-to-day basis and be calculated by the
Creditor on the basis of a 365 days' year and interest shall be compounded in
accordance with the usual practice of the Creditor.
(c) The Creditor shall not be entitled to recover any amount in respect of
interest both under this Guarantee and any of the Loan Agreement in
respect of any failure to pay any sum under any of the Loan Agreement.
6 SUSPENSE ACCOUNT
8
<PAGE>
(a) The Creditor may place to the credit of a suspense account any monies
received under or in connection with this Guarantee in order to
preserve the rights of the Creditor to prove for the full amount of
all of its claims against any and each of the Principal Debtors and
any other person.
(b) The Creditor may, at any time, apply any of the monies referred to in
clause 6(a) in or towards satisfaction of any of the monies,
obligations and liabilities and the subject of this Guarantee as the
Creditor, in its absolute discretion, may from time to time
conclusively determine.
7 APPROPRIATION
None of the Guarantors shall and none of the guarantors may direct the
application by the Creditor of any sums received by the Creditor from any of the
Guarantors under, or pursuant to, any of the terms of this Guarantee.
8 DISCHARGE TO BE CONDITIONAL
Any release, discharge or settlement between any of the Guarantors and the
Creditor in relation to this Guarantee shall be conditional upon no right,
security, disposition or payment to the Creditor by any of the Guarantors and
the Principal Debtor and any other person being void, set aside or ordered to be
refunded pursuant to any enactment or law relating to breach of duty by any
person, bankruptcy, liquidation, administration, the protection from creditors
generally or insolvency or for any other reason.
If any such right, security, disposition or payment is void or at any time so
set aside or ordered to be refunded, the Creditor shall be entitled subsequently
to enforce this Guarantee against any of the Guarantors as if such release,
discharge or settlement had not occurred and any such security, disposition or
payment had not been made.
9 PAYMENTS AND TAXES
(a) All sums payable by each and any of the Guarantors under this
9
<PAGE>
Guarantee shall be paid to the Creditor in full without:
(i) any set-off, condition or counterclaim whatsoever; and
(ii) free and clear of any deduction or withholding whatsoever save
only as may be required by law or regulation which in either
case is binding on it.
(b) If any deduction or withholding is required by any law, practice or
regulation (whether or not such practice or regulation has the force
of law) in respect of any payment due from any of the Guarantors under
this Guarantee or is in any event made, the relative sum payable by
any Guarantor shall be increased so that, after making the minimum
deduction or withholding so required, that Guarantor shall pay to the
Creditor and the Creditor shall receive and be entitled to retain on
the due date for payment a net sum at least equal to the sum which it
would have received had no such deduction or withholding been required
to be, or had in fact been, made.
(c) Each of the Guarantors shall promptly deliver or procure the delivery
to the Creditor of all receipts issued to it evidencing each deduction
and withholding which it has made.
and, in either case, the increased payment would not have become payable if
the Creditor had been a Qualifying Bank.
10 DEMANDS AND NOTIFICATION BINDING
Any demand, notification or certificate given by the Creditor specifying amounts
due and payable under or in connection with any of the provisions of this
Guarantee shall, in the absence of manifest error, be conclusive and binding on
each of the Guarantors.
11 COSTS
10
<PAGE>
Each of the Guarantors shall, on demand and on a full indemnity basis, pay to
the Creditor the amount of all costs and expenses (including legal and
out-of-pocket expenses and any Value Added Tax on such costs and expenses) which
the Creditor incurs in connection with:
(a) the preparation, negotiation, execution and delivery of this
Guarantee;
(b) any actual or proposed amendment, variation, supplement, waiver
or consent under or in connection with this Guarantee;
(c) any discharge or release of this Guarantee; and
(d) the preservation or exercise (or attempted preservation or
exercise), and the enforcement (or attempted enforcement) of any
rights under or in connection with, this Guarantee;
12 COMMUNICATIONS
Any demand or notice under this Guarantee shall be in writing signed by an
officer or agent of the Creditor and (without prejudice to any other effective
means of serving it) may be served on the relative Guarantor personally or by
post and either by delivering it to any officer of that Guarantor at any place
or by despatching it addressed to that Guarantor at the Guarantor's registered
or principal office for the time being or a place of business of that Guarantor
last known to the Creditor. Any such demand or notice delivered personally shall
be deemed to have been received immediately upon delivery. Any such demand or
notice sent by post shall be deemed to have been received at the opening of
business in the intended place of receipt on the business day following the day
on which it was posted, even if returned undelivered.
13 TRANSFERS
13.1 This Guarantee is freely assignable or transferable by the Creditor.
11
<PAGE>
13.2 None of the Guarantors may assign any of its rights and may not transfer
any of its obligations under this Guarantee or enter into any transaction which
would result in any of those rights or obligations passing to another person.
13.3 The Creditor may disclose to any person related to the Creditor and/or any
person to whom it is proposing to transfer or assign or has transferred or
assigned any of its rights under this Guarantee any information about any of the
Guarantors and any person connected or associated with it. Each of the
Guarantors represents and warrants that it has (and, subject to any contrary
requirement of law, will maintain) any necessary authority by or on behalf of
any such person to agree to the provisions of this Clause.
14 CURRENCY INDEMNITY
If, under any applicable law or regulation or pursuant to a judgment or order
being made or registered against any Guarantor or the liquidation of that
Guarantor or without limitation for any other reason, any payment under or in
connection with this Guarantee is made or falls to be satisfied in a currency
(the `payment currency') other than the currency in which such payment is
expressed to be due under or in connection with this Guarantee (the `contractual
currency') then, to the extent that the amount of such payment actually received
by the Creditor, when converted into the contractual currency at the rate of
exchange, falls short of the amount due under or in connection with this
Guarantee, that Guarantor, as a separate and independent obligation, shall
indemnify and hold harmless the Creditor against the amount of such shortfall.
For the purposes of this Clause, `rate of exchange' means the rate at which the
Creditor is able on or about the date of such payment to purchase, in accordance
with its normal practice, the contractual currency with the payment currency and
shall take into account (and that Guarantor shall be liable for) any premium and
other costs of exchange including any taxes or duties incurred by reason of any
such exchange.
15 MISCELLANEOUS
15.1 No delay or omission on the part of the Creditor in exercising any right or
remedy
12
<PAGE>
under this Guarantee shall impair that right or remedy or operate as or be taken
to be a waiver of it; nor shall any single partial or defective exercise of any
such right or remedy preclude any other or further exercise under this Guarantee
of that or any other right or remedy.
15.2 The Creditor's rights under this Guarantee are cumulative and not exclusive
of any rights provided by law and may be exercised from time to time and as
often as the Creditor deems expedient.
15.3 Any waiver by the Creditor of any terms of this Guarantee, or any consent
or approval given by the Creditor under it, shall only be effective if given in
writing and then only for the purpose and upon the terms and conditions, if any,
on which it is given.
15.4 If at any time any one or more of the provisions of this Guarantee is or
becomes illegal, invalid or unenforceable in any respect under any law of any
jurisdiction, neither the legality, validity and enforceability of the remaining
provisions of this Guarantee nor the legality, validity or enforceability of
such provision under the law of any other jurisdiction shall be in any way
affected or impaired as a result.
16 LANGUAGE
All notices demands or communications under or in connection with this Guarantee
shall be in English.
17 LAW AND JURISDICTION
17.1 This Guarantee is governed by and shall be construed in accordance with
Northern Ireland law.
17.2 Each of the Guarantors irrevocably agrees for the exclusive benefit of the
Creditor that the courts of Northern Ireland shall have jurisdiction to hear and
determine any suit action or proceeding, and to settle any dispute, which may
arise out of or in connection with the Guarantee and for such purposes hereby
irrevocably submits to the
13
<PAGE>
jurisdiction of such courts.
17.3 Nothing contained in this Clause shall limit the right of the Creditor to
take proceedings against any of the Guarantors in any other court of competent
jurisdiction, nor shall the taking of any such proceedings in one or more
jurisdictions preclude the taking of proceedings in any other jurisdiction,
whether concurrently or not (unless precluded by applicable law).
17.4 Each of the Guarantors irrevocably waives any objection which it may have
now or in the future to the courts of Northern Ireland being nominated for the
purpose of this Clause on the ground of venue or otherwise and agrees not to
claim that any such court is not a convenient or appropriate forum.
FIRST SCHEDULE
The Guarantors
UNICOMP INC OF 1850 PARKWAY PLACE, SUITE 925, MARIETTA GA 30067
ICS UNICOMP LIMITED, UNIBOL LIMITED ICS COMPUTING GROUP LIMITED OF
ACRE HOUSE, 11-15 WILLIAM ROAD, LONDON, NW1 3ER
AURORA UNICOMP LIMITED OF UNICOMP HOUSE, MALLUSK ROAD,
NEWTOWNABBEY, BT36 8WU
EXECUTED as a Deed by
UNICOMP INC in the presence of: :
:
- -------------------- :
Director :
:
- -------------------- :
Director/Secretary :
14
<PAGE>
EXECUTED as a Deed by ICS UNICOMP :
LIMITED in the presence of: :
:
- -------------------- :
Director :
:
- -------------------- :
Director/Secretary :
EXECUTED as a Deed by UNIBOL LIMITED :
in the presence of: :
:
- -------------------- :
Director :
:
- -------------------- :
Director/Secretary :
EXECUTED as a Deed by :
ICS COMPUTING GROUP LIMITED in the :
presence of: :
:
- -------------------- :
Director :
:
- -------------------- :
Director/Secretary :
15
<PAGE>
EXECUTED as a Deed by AURORA :
UNICOMP LIMITED in the presence of: :
:
- -------------------- :
Director :
:
- -------------------- :
Director/Secretary :
16
<PAGE>
DATED THIS DAY OF 199
UNICOMP GROUP OF COMPANIES
-to-
SX3 LIMITED
-------------------------------------
GUARANTEE and INDEMNITY
-------------------------------------
Messrs Carson & McDowell
Solicitors
Murray House
4/5 Murray Street
BELFAST
BT1 6HS
17
