Exhibit 10.1

 

Dated 24 September 2020

 

The Sellers

and

Boxlight Corporation

 

SHARE PURCHASE AGREEMENT

relating to the sale and purchase of the entire issued share capital of

SAHARA HOLDINGS LIMITED

 

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TABLE OF CONTENTS

 

    Page INTRODUCTION   4 1 DEFINITIONS AND INTERPRETATION   4 2 SALE AND
PURCHASE   14 3 CONSIDERATION   14 4 COMPLETION   14 5 WARRANTIES   15 6 TAX  
16 7 RESTRICTIVE COVENANTS   16 8 SEVERAL LIABILITY   18 9 RELEASE BY THE
SELLERS   18 10 ANNOUNCEMENTS   19 11 CONFIDENTIALITY   19 12 ENTIRE AGREEMENT  
20 13 CUMULATIVE RIGHTS   20 14 ASSIGNMENT AND TRANSFER   20 15 COSTS AND
EXPENSES   21 16 INTEREST ON LATE PAYMENTS   21 17 WITHHOLDING & GROSSING-UP  
21 18 EFFECT OF COMPLETION   21 19 WAIVER   21 20 VARIATION   22 21 SEVERANCE  
22 22 FURTHER ASSURANCE   22 23 SELLERS’ REPRESENTATIVES   23 24 NOTICES   23 25
COUNTERPARTS   24 26 GOVERNING LANGUAGE   24 27 SUCCESSORS   24 28 RIGHTS OF
THIRD PARTIES   25 29 RIGHTS & REMEDIES   25 30 DISPUTE RESOLUTION   25 31
GOVERNING LAW   25 32 JURISDICTION   25 33 EXECUTION   25 Schedule 1 The Sellers
  26 Schedule 2   28 Part 1: Particulars of the Company   28 Part 2: Particulars
of the Subsidiaries   29 Schedule 3   36 Part 1: Documents to be delivered by
the Sellers   36

 

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Part 2: Documents to be delivered by the Buyer   38 Schedule 4 Warranties   39
Schedule 5 Limitations on Liability   63 Schedule 6   68 Part 1: Key Customers  
68 Part 2: Key Suppliers   69 Schedule 7   70 Schedule 8 Taxation   71 Part 1:
Definitions and interpretations   71 Part 2 (Tax Covenant)   74 Part 3
(Limitations and general)   76 SCHEDULE 9 Form of Series B Consideration Shares
Certificate of Designation   SCHEDULE 10 Form of Series C Consideration Shares
Certificate of Designation   SCHEDULE 11 Form of Voting and Lockup Agreement

 

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Dated 24 September 2020

 

PARTIES

 

(1) THE PERSONS whose names and addresses are set out in Schedule 1 (the
“Sellers”, and each a “Seller”); and

 

(2) BOXLIGHT CORPORATION, a United States corporation organized under the laws
of the State of Nevada (the “Buyer”), whose registered office is at 1045
Progress Circle, Lawrenceville, Georgia 30043.

 

INTRODUCTION

 

(A) The Sellers are the legal and beneficial owners of the entire issued share
capital of the Company and as such have the right, power and authority to sell
and transfer the Shares in the manner contemplated by this Agreement.

 

(B) The Sellers have agreed to sell to the Buyer and the Buyer has agreed to
purchase the Shares for the Consideration and otherwise in the manner and on and
subject to the terms of this Agreement.

 

OPERATIVE PROVISIONS

 

1 DEFINITIONS AND INTERPRETATION

 

1.1 In this Agreement, except where a different interpretation is necessary in
the context, the words and expressions set out below shall have the following
meanings:

 

“2020 Management Accounts” means the unaudited consolidated balance sheet as at
30 June 2020 and the unaudited comparative consolidated profit and loss account
for the six month period ended 30 June 2020, respectively, of the Company and
each of the Subsidiaries;

 

“Accounts” means the audited consolidated balance sheet as at 31 December 2017,
31 December 2018 and 31 December 2019, and the audited consolidated profit and
loss account for the three Financial Years ended on 31 December 2017, 31
December 2018 and 31 December 2019, of the Company and each of the Subsidiaries
(including, in the case of the Company, the audited consolidated balance sheet
as at such dates and the audited consolidated profit and loss account for such
Financial Years) together with the notes, reports, statements (including cash
flow statements, if applicable) and other documents which are or would be
required by law to be annexed to the accounts of the company concerned and to be
sent or made available to members, a copy of each of which has been included in
folder 2 of the Data Room;

 

“Accounts Date” means 31 December 2019;

 

“Accounts Standards” means the applicable requirements of the Companies Act
2006, together with the accounting principles, standards and practices which are
generally accepted in the United Kingdom (including FRS 102), in each case at
the date to which the relevant Accounts were made up to;

 

“Affiliate” means in relation to any Person (whether or not registered in the
United Kingdom), any parent undertaking or subsidiary undertaking of such Person
or any subsidiary undertaking of a parent undertaking of such Person, in each
case from time to time;

 

“Agreement” means this agreement including the Introduction and the Schedules;

 

“Announcement” means the press announcement concerning the transactions
contemplated by this Agreement in the agreed form;

 

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“Breach of Warranty Claim” means a claim by the Buyer for breach of Warranty,
including Business Warranties and Tax Warranties referred to in Schedule 4;

 

“Business” means, collectively, the businesses of any of the Group Companies at
the date hereof which generally involves the production and distribution of
products, including AV solutions, and related software to the education, health,
public and corporate market sectors, directly and through resellers;

 

“Business Day” means a day other than a Saturday, Sunday or public holiday in
England;

 

“Business IP” means all Intellectual Property which is owned or which is used or
exploited in the actual Business by any of the Group Companies including all
Intellectual Property in the products and services supplied and/or developed by
them;

 

“Business Warranties” means the Warranties excluding the Fundamental Warranties
and Tax Warranties;

 

“Business Warranty Claim” means any claim for breach of the Business Warranties;

 

“Buyer’s Completion Documents” means this Agreement and any other documents
which are to be executed by the Buyer pursuant to this Agreement, as listed in
Part 2 of Schedule 3;

 

“Buyer’s Group” means the Buyer and its Affiliates and, from and after
Completion, includes each Group Company;

 

“Buyer’s Relief” has the meaning given to it in Schedule 8;

 

“Buyer’s Solicitors” means Michelman & Robinson LLP (U.S. counsel) and Hinds &
Small Limited. (U.K. counsel);

 

“CA 2006” means the Companies Act 2006;

 

“CAA 2001” means the Capital Allowances Act 2001;

 

“Cash Consideration” means £52,000,000 (fifty-two million pounds);

 

“Cash Reserves” means £12,000,000 (twelve million pounds);

 

“Claim” means any a claim for breach of any of the Warranties or a Tax Claim.

 

“Class A Common Stock” means the shares of the Class A voting common stock of
Buyer, par value $0.0001 per share;

 

“Company” means Sahara Holdings Limited, short particulars of which are set out
in Schedule 2;

 

“Company Option Exercise Tax” means the aggregate of any Option Exercise Tax
that is not recoverable from the Option Sellers;

 

“Company Web Site” means any web site(s) owned, operated or hosted by any Group
Company or through which any Group Company conducts any of the Business;

 

“Competing Business” means any part of any trade or business which competes with
all or any part of the Business carried on by any of the Group Companies as at
Completion or any business that develops or markets any products or services
provided by any Group Company at Completion (including for the avoidance of
doubt, the Clevertouch brand screens and associated products);

 

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“Completion” means completion of the sale and purchase of the Shares in
accordance with the terms of clause 4;

 

“Completion Payment” means the amount to be paid to the Sellers on Completion in
cash in the amounts set out against each Seller’s name in column 7 of the table
in Schedule 1, in accordance with clause 4.4(a), being, in aggregate,
£40,000,000 of the Cash Consideration;

 

“Confidential Information” means all technical, financial, commercial and other
information of a confidential nature relating to the Business, including trade
secrets, know-how, inventions, product information and unpublished information
relating to Intellectual Property, source code relating to Software, marketing
and business plans, projections, current or projected plans or internal affairs
of the Group Companies, secret or confidential information, current and/or
prospective suppliers and customers (including any customer or supplier lists)
and any other Person who has had material dealings with them;

 

“Connected Person” means a Person connected with a Seller and/or Covenantor
within the meaning of section 1122 CTA 2010;

 

“Consideration” means the consideration referred to in clause 3.1;

 

“Control” has the meaning given in section 1124 of the CTA 2010, and the
expression change of Control shall be construed accordingly

 

“Controller” has the meaning given to the term under the DPA;

 

“Covenantors” means each of Kevin Batley, Nigel Batley, Sheila Batley, Annette
Batley, Shaun Marklew and Simon Chidsey;

 

“CTA 2009” means the Corporation Tax Act 2009;

 

“CTA 2010” means the Corporation Tax Act 2010;

 

“Data Protection Legislation” means:

 

  (a) all legislation; and

 

  (b) the Payment Card Industry Data Security Standard, and all other rules and
requirements of payment card brands (to the extent applicable)

 

in each case relating to the processing of personal data, to the privacy of
individuals, to the transmission of marketing and/or commercial messages and to
the recording, interception and monitoring of communications, including without
limitation the GDPR, the DPA, Directive 2002/58/EC of the European Parliament
and of the Council of 12 July 2002 on privacy and electronic communications and
the Privacy and Electronic Communications (EC Directive) Regulations 2003, as
amended and any analogous legislation in any jurisdiction in which any Group
Company carries on its Business;

 

“Data Room” means the Project Elliott virtual data room hosted by HighQ and
operated by the Sellers’ Solicitors;

 

“Defined Benefit Scheme” means a scheme under which the amount of some or all of
the benefits payable to or in respect of a member of the scheme is calculated in
accordance with a formula which takes account of the service of the member to
retirement, death or withdrawal and the remuneration of the member averaged over
his service at or close to his retirement, death or withdrawal;

 

“Defined Contribution Scheme” means a scheme under which the amount of the
benefits, or the amount of the benefits other than some or all of the benefits
payable on death before becoming a pensioner, payable to or in respect of a
member of the scheme is calculated by reference to the contributions made to the
scheme by and in respect of the member;

 

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“Directors” means the Persons specified as directors of the Company in Schedule
2 (and a “Director” means any of them);

 

“Disclosed” means fairly disclosed in sufficient detail to enable a reasonable
purchaser to identify the nature and scope of the matter, fact or circumstance
disclosed;

 

“Disclosure Bundle” means the contents of the Data Room a copy of the index of
which is annexed to the Disclosure Letter;

 

“Disclosure Letter” means a letter in the agreed form dated on or before the
date of this Agreement from the Sellers to the Buyer, delivered to the Buyer
immediately before execution of this Agreement, for which the Buyer has
acknowledged receipt, including the Disclosure Bundle, together with the agreed
form index of the Disclosure Bundle;

 

“DPA” means the Data Protection Act 2018;

 

“Embargo Countries” means those countries listed by the Foreign and Commonwealth
Office or the US Department of the Treasury Office of Foreign Assets Control as
being subject to an embargo regime, and “Embargo Country” shall mean any one of
them;

 

“Embargo Entity” means an Entity situated in an Embargo Country;

 

“Employees” means those Persons who have entered into or work under terms of a
contract of employment with a Group Company;

 

“Employee List” has the meaning given to it in paragraph 9.1 of Schedule 4;

 

“Encumbrance” means any interest or equity of any Person (including any right to
acquire, option or right of pre-emption) or any mortgage, charge, pledge, lien,
assignment, hypothecation, security interest, title retention or any other
security agreement or arrangement;

 

“Entity” means any Person, corporation, partnership, organisation, government
organisation, non-governmental or quasi-governmental organisation, or other
entity;

 

“Environmental Laws” means all international, European Union, national, federal,
state or local laws (including common and statute law and civil and criminal
law) and all subordinate legislation and regulatory codes of practice (including
statutory instruments, guidance notes, permits, circulars, industry agreements,
directives, decisions, regulations, treaties and conventions) relating to
environmental matters which are or were binding on the Group Companies in the
relevant jurisdiction in which Group Companies are or have been operating;

 

“Environmental Matters” means all or any matters relating to the pollution or
protection of the environment or harm to or the protection of human health and
safety or the health of animals and plants or energy efficiency or reduction or
emissions trading;

 

“FCA” means the Financial Conduct Authority;

 

“Financial Year” means a financial year as determined in accordance with section
390 Companies Act 2006;

 

“FRS” means the Financial Reporting Standard issued or adopted by the Financial
Reporting Council;

 

“FSMA” means the Financial Services and Markets Act 2000, as amended and in
force from time to time;

 

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“Fundamental Warranties” means the warranties contained in paragraphs 1
(Capacity and authority) and 2 (The Shares) of Schedule 4;

 

“Group Companies” means the Company and the Subsidiaries, and each of them a
“Group Company” and together the “Group”;

 

“Health and Safety Laws” means all international, European Union, national,
federal, state or local laws (including common and statute law and civil and
criminal law) and all subordinate legislation and regulatory codes of practice
(including statutory instruments, guidance notes, permits, circulars, industry
agreements, directives, decisions, regulations, treaties and conventions)
relating to human health and safety or the condition of the workplace which are
or were binding on the Group Companies in the relevant jurisdiction in which the
Group Companies are or have been operating;

 

“Historic Sale Contracts” has the meaning set out in paragraph 3.9 of Schedule
4;

 

“ICT Infrastructure” means the information and communications technology
infrastructure and systems including Software, hardware, firmware and networks
which is used in and is material to the operation of the Business;

 

“IHTA 1984” means the Inheritance Tax Act 1984;

 

“Intellectual Property” means all:

 

  (a) letters patent, patent applications, continuations, utility models, trade
marks, service marks, registered designs, trade names, business names, domain
names and email addresses, unregistered trade marks and service marks, rights in
logos and get-up, copyright, database rights, all rights of whatsoever nature in
computer software and data, semiconductor topographies, inventions, rights in
confidential information, know-how, rights in designs;

 

  (b) rights under licences, consents, statutes, orders or otherwise in relation
to a right in paragraph (a) of this definition;

 

  (c) rights of the same or similar effect or nature to those in paragraphs (a)
and (b) of this definition anywhere in the world which now or in the future may
subsist;

 

  (d) renewals, reversions or extensions, applications and rights to apply for
any of the rights in paragraphs (a), (b) and (c) of this definition; and

 

  (e) the right to sue for damages for past infringement of any right referred
to in this definition;

 

“Key Contracts” means the agreements, arrangements and commitments (whether or
not reduced to writing) which are material to the Business that are in force at
Completion being contracts with Key Customers, Key Suppliers, each Licence-In
and Licence-Out;

 

“Key Customers” means those customers listed in Part 1 of Schedule 6 and “Key
Customer” shall mean any one of them;

 

“Key Employee” means any Person who:

 

  (a) at the date of this Agreement; or

 

  (b) at any time during the 12 months immediately preceding the date of this
Agreement,

 

is or was an employee or consultant of or to the Company or any Group Company
and who is, or who was during that period (i) employed or engaged on basic gross
salary or fees in excess of £40,000 per annum, and/or (ii) acting at management
grade;

 

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“Key Suppliers” means those suppliers listed in Part 2 of Schedule 6 and “Key
Supplier” shall mean any one of them;

 

“Licence-In” means an agreement by a Person to license Intellectual Property to
any Group Company;

 

“Licence-Out” means an agreement by any Group Company to license or sub-license
Intellectual Property to a Person;

 

“Licensed Business IP” means any Business IP which is currently licensed or
sub-licensed to any Group Company;

 

“Losses” shall mean any liability, cost, damages or expenses (including
reasonable attorneys’ fees), fines or penalties incurred by Buyer or any of the
Group Companies;

 

“Management Accounts” means the unaudited consolidated balance sheets as at 30
June 2019 and 30 June 2020, and the unaudited comparative consolidated profit
and loss account for the six month periods ended 30 June 2019 and 30 June 2020,
respectively, of the Company and each of the Subsidiaries;

 

“Material Adverse Effect” means any event, or act of omission or commission that
could reasonably be expected have a material adverse effect and impact on the
Business, assets, liabilities, revenues, profits and prospects of the Group
Companies, when taken as a consolidated whole

 

“Missing Asset” has the meaning given to it in clause 22.2;

 

“Nasdaq” means the Nasdaq Capital Market securities exchange of the Nasdaq Stock
Market;

 

“Non-Disclosable Information” means all information (including but not limited
to Confidential Information) which relates to:

 

  (a) the Group Companies and/or their respective Affiliates;

 

  (b) any aspect of the Business;

 

  (c) the provisions of this Agreement or any other Transaction Document;

 

  (d) the negotiations relating to this Agreement or any other Transaction
Document;

 

  (e) the subject matter of this Agreement or any other Transaction Document; or

 

  (f) the Buyer and any of its Affiliates from time to time;

 

“Non-Option Sellers” means each of Kevin Batley, Nigel Batley, Sheila Batley and
Annette Batley;

 

“Notice of Claim” means a notice of a Claim or Breach of Warranty Claim,
specifying in reasonable detail the nature of the claim and the Buyer’s estimate
of the value of the relevant claim;

 

“Options” the respective rights to acquire Option Shares granted to each Option
Seller pursuant to an enterprise management incentives options scheme dated 13
June 2019;

 

“Option Exercise Tax” means the aggregate of the Tax (in any relevant
jurisdiction) and other similar charges (including, but not limited to, employee
and employer’s national insurance contributions and PAYE contributions) payable
by a Group Company on exercise of an Option;

 

“Option Sellers” means Shaun Marklew and Simon Chidsey;

 

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“Option Shares” means 426 B ordinary shares of £0.01 nominal value each in the
capital of the Company to be issued to the Option Sellers in the amounts set out
opposite each Option Seller’s name in column 3 of the table set out in Schedule
1 on the exercise of their Options immediately prior to Completion and “Option
Share” shall mean any one of them;

 

“Ordinary Shares” means the A ordinary shares, B ordinary shares, C ordinary
shares and D ordinary shares of £0.01 nominal value each in the capital of the
Company set out opposite each Seller’s name in column 2 of the table set out in
Schedule 1;

 

“Owned Business IP” means any Business IP which is owned by any Group Company;

 

“Pension Schemes” means the pension schemes operated by or on behalf of the
Company as set out in section 8 of the Data Room;

 

“Pensionable Employee” means a director or employee or former director or former
employee of any Group Company;

 

“Person” means and includes the individual or collective reference to any
individual, corporation, partnership, limited liability company, trust,
governmental agency or other entity.

 

“Personal Data” has the same meaning as the term “personal data” under the DPA;

 

“Policies” means the current insurance and indemnity policies in respect of
which any Group Company has an interest (including but not limited to any active
historic policies which provide cover on a “losses occurring” basis);

 

“PRA” means the Prudential Regulation Authority;

 

“Principal Sellers” means the individual and collective reference to Kevin
Batley and Nigel Batley;

 

“Properties” means each of the properties listed in Schedule 7 (each a
“Property”);

 

“Publicly Available Software” means any software that:

 

  (a) contains, or is derived (in whole or in part) in any manner from, any
software that is distributed as open source software, free software or pursuant
to any similar distribution and/or licensing model; and

 

  (b) requires, as a condition of its use, modification and/or distribution that
any such software or any other software derived from, incorporated into, or
distributed with such software be:

 

  (i) distributed or disclosed in source code form;

 

  (ii) licensed for the purpose of making derivative works; and/or

 

  (iii) redistributable at a minimum charge or no charge;

 

“Relevant Person” has the meaning given to it in clause 9.1;

 

“Sellers’ Completion Documents” means this Agreement and any other documents
which are to be executed by the Sellers pursuant to this Agreement, as listed in
Part 1 of Schedule 3;

 

“Sellers’ Representatives” means Kevin Batley and Nigel Batley or such other
Person as may be appointed in accordance with clause 23;

 

“Sellers’ Solicitors” means Cripps Pemberton Greenish LLP of Number 22, Mount
Ephraim, Tunbridge Wells, Kent TN4 8AS;

 

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“Sellers’ Solicitors Account” means the following bank account:

 

Account name: Cripps LLP Client Account

Account number: 04095642

Sort code: 18-00-02

IBAN number: GB55 COUT 1800 0204 0956 42

Swift code: COUTGB22

Bank: Coutts, Head Office, London

 

Quoting reference: SYS/JJK/BA51571.1;

 

“Series B Consideration Shares” means the Series B Redeemable Convertible
Preferred Stock of the Buyer to be issued to the Sellers on Completion in the
amounts set out against each Seller’s name in column 5 of the table in Schedule
1, in accordance with clause 4.4(b), being, in aggregate, the sum of
£12,000,000;

 

“Series C Consideration Shares” means the Series C Redeemable Convertible
Preferred Stock of the Buyer to be issued to the Sellers on Completion in the
amounts set out against each Seller’s name in column 6 of the table in Schedule
1, in accordance with clause 4.4(b), being, in aggregate, the sum of
£10,000,000;

 

“Series B Consideration Shares Certificate” means the certificate of designation
containing the rights, privileges and preferences of the Series B Consideration
Shares to be filed on or immediately following the close of trading of the
Buyer’s Class A Common Stock on the Business Day immediately following the date
of Completion with the Secretary of State of the State of Nevada, USA, and in
the form set forth on Schedule 9;

 

“Series C Consideration Shares Certificate” means the certificate of designation
containing the rights, privileges and preferences of the Series B Consideration
Shares to be filed on or immediately following the close of trading of the
Buyer’s Class A Common Stock on the Business Day immediately following the date
of Completion with the Secretary of State of the State of Nevada, USA, and in
the form set forth on Schedule 10;

 

“Shares” means the Ordinary Shares and the Option Shares;

 

“Software” means any and all computer programs in both source and object code
form, including all modules, routines and sub-routines and all source and other
preparatory materials relating to the above including user requirements,
functional specifications and programming specifications, programming languages,
algorithms, flow charts, logic, logic diagrams, orthographic representations,
file structures, coding sheets, coding and including any manuals or other
documentation and all enhancements, improvements, replacement and derivative
works relating to any of the above;

 

“Subsidiaries” means those companies or other Persons short particulars of which
appear in Part 2 of Schedule 2, and the expression “Subsidiary” shall mean any
one of the Subsidiaries;

 

“Tax” or “Taxation” has the meaning given to it in Schedule 8;

 

“Tax Authority” has the meaning given to it in Schedule 8;

 

“Tax Claim” means a Tax Covenant Claim or a Tax Warranty Claim;

 

“Tax Covenant” means the covenant contained in Part 2 of Schedule 8;

 

“Tax Covenant Claim” mains a claim under the Tax Covenant;

 

“Tax Warranties” means the warranties contained in paragraph 30 of Schedule 4;

 

“Tax Warranty Claim” means a claim for breach of the Tax Warranties;

 

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“Third Party Claim” has the meaning given to it in paragraph 9 of Schedule 5;

 

“Transaction Documents” means this Agreement and any of the documents executed
pursuant to this Agreement (including, for the avoidance of doubt, the Sellers’
Completion Documents);

 

“Transfer Regulations/TUPE” means Transfer of Undertakings (Protection of
Employment) Regulations 2006;

 

“U.K/United Kingdom” means England, Scotland, Northern Ireland and Wales.

 

“U.S. United States” means the United States of America

 

“Variation to Service Agreements” means the variation to the service or
employment agreements in the agreed form to be entered into on Completion
between the Sahara Presentation Systems Plc and each of Mark Starkey, as Chief
Executive Officer, Pat Foley, as Chief Financial Officer, and such other Key
Employees as the Buyer and the Principal Sellers mutually agree upon;

 

“VAT” means:

 

  (a) value added tax imposed pursuant to VATA and legislation and regulations
similar or supplemental thereto;

 

  (b) any tax imposed in compliance with the European Council directive of 28
November 2006 on the common system of value added tax (EC Directive 2006/112);
and

 

  (c) any other tax of a similar nature, whether imposed in a member state of
the European Union in substitution for, or levied in addition to, the tax
referred to in (b) above, or elsewhere;

 

“VATA” means the Value Added Tax Act 1994;

 

Voting and Lockup Agreement” means the agreement among Boxlight and the Sellers
to be executed and delivered at Completion and in substantially the form set
forth on Schedule 11 to this Agreement;

 

“Warranties” means the individual and collective reference to any Fundamental
Warranty, Business Warranty and Tax Warranty, and warranties contained in
Schedule 4 and each and warranty statement shall be a “Warranty”;

 

“Warranty Claim” means a claim for breach of clause 5.2 and the Warranties;

 

“Workers” means those individuals who are providing services to the Company or
any Group Company under or pursuant to any agreement which is not a contract of
employment with the relevant company including where the individual acts as a
consultant, contractor or worker, non-executive director or officer of the
Company or any Group Company and in each case whether directly contracted or
supplied by an agency, employment business, service company or other third party
but excluding any Person in business on their own account and in respect of whom
the Company’s or any Group Company’s status is that of a customer or client;

 

“£” means the lawful currency of the United Kingdom; and

 

“$” means the lawful currency of the United States.

 

1.2 The clause and paragraph headings and the table of contents used in this
Agreement are inserted for ease of reference only and shall not affect
construction.

 

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1.3 References in this Agreement and the Schedules to the parties, the
Introduction, Schedules and clauses are references respectively to the parties,
the Introduction and Schedules to and clauses of this Agreement.

 

1.4 References to documents “in the agreed form” are to documents in terms
agreed between the parties prior to execution of this Agreement.

 

1.5 References to “writing” or “written” includes any other non-transitory form
of visible reproduction of words.

 

1.6 References to times of the day are to that time in London, England and
references to a day are to a period of 24 hours running from midnight.

 

1.7 References to any English legal term or legal concept shall in respect of
any jurisdiction other than England be deemed to include that which most
approximates in that jurisdiction to such English legal term or legal concept.

 

1.8 References to Persons shall have the meaning set forth in the Definitions..

 

1.9 References to the word “include” or “including” (or any similar term) are
not to be construed as implying any limitation and general words introduced by
the word “other” (or any similar term) shall not be given a restrictive meaning
by reason of the fact that they are preceded by words indicating a particular
class of acts, matters or things.

 

1.10 Save where the context specifically requires otherwise, words importing one
gender shall be treated as importing any gender, words importing individuals
shall be treated as importing corporations and vice versa, words importing the
singular shall be treated as importing the plural and vice versa, and words
importing the whole shall be treated as including a reference to any part
thereof.

 

1.11 References to statutory provisions, enactments or EC Directives shall
include references to any amendment, modification, extension, consolidation,
replacement or re-enactment of any such provision, enactment or Directive
(whether before or after the date of this Agreement), to any previous enactment
which has been replaced or amended and to any regulation, instrument or order or
other subordinate legislation made under such provision, enactment or Directive
provided that, as between the parties, no such amendment, modification,
extension, consolidation, replacement or re-enactment made after the date of
this Agreement shall apply for the purposes of this Agreement to the extent that
it would impose any new or extended obligation, liability or restriction on, or
otherwise adversely affect the rights of, any party.

 

1.12 A company or other entity shall be a “holding company” for the purposes of
this Agreement if it falls within either the meaning attributed to that term in
section 1159 and Schedule 6 Companies Act 2006 or the meaning attributed to the
term “parent undertaking” in section 1162 and Schedule 7 of such Act, and a
company or other entity shall be a “subsidiary” for the purposes of this
Agreement if it falls within any of the meanings attributed to a “subsidiary” in
section 1159 and Schedule 6 Companies Act 2006 or any of the meanings attributed
to the term “subsidiary undertaking” in section 1162 and Schedule 7 of such Act,
and the terms “subsidiaries” and “holding companies” are to be construed
accordingly, save that an undertaking shall also be treated, for the purposes
only of the membership requirement contained in subsections 1162(2)(b) and (d)
Companies Act 2006, as a member of another undertaking if any shares in that
other undertaking are held by a Person (or its nominee) by way of security or in
connection with the taking of security granted by the undertaking or any of its
subsidiary undertakings.

 

1.13 Section 1122 CTA 2010 is to apply to determine whether one Person is
connected with another for the purposes of this Agreement.

 

1.14 References to those of the parties who are individuals include references
to their respective legal personal representatives.

 

1.15 The definitions contained in Schedule 8 apply throughout this Agreement.

 

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2 SALE AND PURCHASE

 

2.1 Each of the Sellers shall sell on and with effect from Completion with full
title guarantee, and the Buyer shall, subject to clause 2.2, purchase all of the
Shares set opposite that Seller’s name in Schedule 1 together with all rights
attaching to them at Completion and free from all Encumbrances.

 

2.2 The Buyer shall not be obliged to complete the purchase of any of the Shares
unless the purchase of all the Shares is completed simultaneously in accordance
with this Agreement.

 

2.3 Each of the Sellers irrevocably and unconditionally waives any and all
pre-emption rights, rights of first refusal and other similar rights in respect
of the Shares and the shares in the Subsidiaries whether arising by virtue of
any articles of association, agreement, law or otherwise.

 

3 CONSIDERATION

 

3.1 In consideration of the sale of the Shares in accordance with the terms of
this Agreement, the Buyer shall pay (or, in the case of the Series B
Consideration Shares and Series C Consideration Shares, issue) to the Sellers:

 

  (a) the Cash Consideration; such Cash Consideration to be paid as follows: (i)
£40,000,000 (forty million pounds) on Completion, and (ii) £12,000,000 (twelve
million pounds) (Balancing Payment) on a date which shall be the earlier of 60
days following Completion (Longstop Date) or the Business Day after completion
of the re-registration of Sahara Presentation Systems Plc as a limited company;
plus

 

  (b) the Series B Consideration Shares; plus

 

  (c) the Series C Consideration Shares,

 

(in aggregate, the “Consideration”).

 

3.2 Any payment made by the Sellers to the Buyer under or in respect of any
breach of this Agreement (including as a result of any Claim brought by the
Buyer) shall be and shall be deemed to be a reduction in the price paid for the
Shares under this Agreement to the extent legally possible, provided that the
Consideration shall not be treated as being less than nil in consequence of the
foregoing.

 

3.3 All payments of Cash Consideration to be made by the Buyer to the Seller
under this Agreement, which shall include the Cash Reserves, shall be made in
sterling by electronic transfer of immediately available funds to the Sellers’
Solicitors Account (who are irrevocably authorised by the Sellers to receive the
same). Payment in accordance with this clause and any other written directions
to Sellers’ Solicitors shall be a good and valid discharge of the Buyer’s
obligations to pay the sum in question, and the Buyer shall not be concerned to
see the application of the monies so paid.

 

4 COMPLETION

 

4.1 Completion shall take place at the offices of the Sellers’ Solicitors (or
any other place agreed upon by the Sellers and the Buyer) immediately following
exchange of this Agreement.

 

4.2 Immediately prior to Completion the Option Sellers shall exercise their
Options and the Company shall allot and issue the Option Shares.

 

4.3 At Completion, the Sellers shall deliver or cause to be delivered to the
Buyer the items listed in Part 1 of Schedule 3 (the Buyer receiving them, where
appropriate, as agent for the Company).

 

4.4 The Buyer shall procure:

 

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  (a) on Completion, the payment to the Sellers’ Solicitors Account of the
Completion Payment;

 

  (b) on the Business Day following the date of Completion, the issue of the
Series B Consideration Shares to the Sellers, by issuing to each Seller share
certificates evidencing the Series B Consideration Shares appropriately
registered in the name of each Seller;

 

  (c) on the Business Day following the date of Completion, the issue of the
Series C Consideration Shares to the Sellers, by issuing to each Seller share
certificates evidencing the Series C Consideration Shares appropriately
registered in the name of each Seller;

 

  (d) on the Business Day following the date of Completion, the filing of the
Series B Consideration Shares Certificate and the Series C Consideration Shares
Certificate with the Secretary of State of the State of Nevada; and

 

  (e) on Completion, the delivery to the Sellers of the items listed in Part 2
of Schedule 3.

 

4.5 Out of the Cash Consideration which would otherwise have been receivable
pursuant to clause 3.1, each of the Option Sellers hereby irrevocably and
unconditionally instructs the Buyer to pay to the Company an amount (if any)
equal to any Option Exercise Tax (less any Company Option Exercise Tax) and the
Option Sellers agree that the amount so payable in respect of any Option Seller
shall be deducted from the cash amount otherwise payable to that Option Seller
for his/her Option Shares pursuant to clause 4.4(a) and the Buyer agrees to
procure that the Company shall pay the Option Exercise Tax (if any) to the
relevant Tax Authority within the relevant time limit for payment of such Tax.

 

4.6 Each of the Sellers hereby confirms that the Sellers’ Solicitors are
irrevocably authorised by the Sellers to receive payment of the amounts referred
to as being payable to the Sellers’ Solicitors Account in clauses 4.4(a) on the
Sellers’ behalf and the receipt by the Sellers’ Solicitors shall be a sufficient
discharge for the Buyer of its obligations under clauses 4.4(a), and the Buyer
shall not be concerned to see to the application thereof or be responsible for
the loss or misapplication of such sum.

 

5 WARRANTIES

 

5.1 Each of the Principal Sellers jointly and severally, and Sheila Batley and
Annette Batley (in respect of themselves only) warrant to the Buyer for itself
and for any successor in title to the Shares or to part or all of the Business
that each Fundamental Warranty, is true, correct, accurate and not misleading at
the date of this Agreement.

 

5.2 The Non-Option Sellers warrant jointly and severally, and the Option Sellers
warrant severally, to the Buyer in the terms of all of the Warranties subject
to:

 

  (a) the matters Disclosed in the Disclosure Letter, provided that such matters
will be treated as qualifying or limiting the application of any Warranty only
to the extent they are Disclosed; and

 

  (b) any exceptions for which express provision is made pursuant to this
Agreement.

 

5.3 Each Warranty is a separate and independent warranty and, save as otherwise
expressly provided, no Warranty shall be limited by reference to any other
Warranty or any other provision in this Agreement.

 

5.4 The liability of the Sellers in respect of any Claim shall be limited to the
extent set out in Schedule 5 and Part 3 of Schedule 8, except in relation to any
Claim which arises out of any breach of Section 7 Restrictive Covenants, breach
of any Fundamental Warranty or any fraud, dishonesty or wilful concealment by
the Sellers.

 

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5.5 Any information supplied by any Group Company, its officers, employees or
agents to the Sellers, its agents, representatives or advisers in connection
with, or to form the basis of, the Warranties or any matter covered in the
Disclosure Letter, or for any other reason, shall be deemed not to include or
have included a representation, warranty or guarantee of its accuracy to the
Sellers and shall not constitute a defence to the Sellers to any Claim made by
the Buyer. Each Seller hereby waives any and all claims against the Company and
all Group Companies, their officers, employees or agents in respect of any
information so supplied (and undertakes that no other Person claiming under or
through it will make any such claim). The Company, the Group Companies, their
officers, employees and/or agents may enforce the terms of this clause 5.5 in
accordance with the Contracts (Rights of Third Parties) Act 1999.

 

5.6 Where any Warranty is qualified by the expression “so far as the Sellers are
aware” or “to the best of the knowledge, information and belief of the Sellers”
or words having similar effect, such Warranty shall be deemed to include a
statement that such awareness means both the best knowledge, information and
belief of any of the Sellers, Mark Starkey, Patrick Foley, Adam Kingshott and
John Ginty and also such knowledge which the Sellers would have had if they had
made due, reasonable and careful enquiry of each other Seller and of Mark
Starkey, Patrick Foley, Adam Kingshott and John Ginty.

 

5.7 For the purposes of the Warranties, references to the “Company” shall be
deemed to extend both to the Company and to each of the Subsidiaries to the
effect that each of the Warranties shall be deemed to be repeated (save where
the context otherwise requires) in respect of each of the Subsidiaries as if the
expression the “Company” had been replaced by the name of the Subsidiary
concerned throughout.

 

5.8 Each of the paragraphs in Schedule 4 shall be interpreted as being deemed to
include all references to the foreign equivalent of terms used, statutes and
regulations referred to and concepts applied where a Group Company is
incorporated in, does business in or is affected by the laws or regulations of a
country outside England and Wales.

 

5.10 The Sellers shall not be liable for any Claim to the extent that the “Buyer
had actual knowledge” of the facts, matters or circumstances (including, the
magnitude of the potential risk), giving rise to the Claim prior to Completion.
“Buyer had actual knowledge” (or words to that effect) means solely the actual
(as opposed to constructive or imputed knowledge or which could have been
discovered, whether by investigation made by the Buyer or on its behalf or was
known by its advisors) knowledge of the Chief Executive Officer or Chief
Financial Officer of the Buyer.

 

5.11 For the avoidance of doubt, the rights and remedies of the Buyer in respect
of any Claim or claim under the Tax Covenant shall not be affected by
Completion.

 

6 TAX

 

The provisions of Schedule 8 apply in this Agreement in relation to Taxation.

 

7 RESTRICTIVE COVENANTS

 

7.1 Each Seller (herein defined as Covenantor) severally undertakes to the Buyer
(contracting for itself and as trustee for each Group Company and for any
successor in title to the Shares or to all or part of the Business) that, except
with the prior written consent of the Buyer which may be withheld in its sole
and absolute discretion, he shall not, directly or indirectly (and shall not
encourage or direct their Connected Persons to)::

 

  (a) in the period of three years from Completion in respect of the Non-Option
Sellers and 12 months in respect of the Option Sellers, be concerned (as defined
in clause 7.2 below) in any Competing Business within the United Kingdom, United
States of America, Germany, Finland, Sweden, France, Spain, Denmark, Austria,
Belgium, Russia, Australia, United Arab Emirates and Holland;

 

  (b) in the period of three years from Completion in respect of the Non-Option
Sellers and 12 months in respect of the Option Sellers, have any dealings with,
canvass, solicit or approach or cause to be canvassed, solicited or approached
any Person, firm or company who:

 

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  (i) at any time during the 24 months prior to Completion shall have been a
direct or indirect client, customer, supplier, distributor or agent (or a client
or customer of a distributor or agent who, at any time during the 24 months
prior to Completion received or benefitted from services and/ or products of any
Group Company through such distributor or agent) of or to any Group Company; or

 

  (ii) at any time during the 24 months prior to Completion was a potential
customer and was canvassed, solicited or approached by any Group Company;

 

  (c) in the period of three years from Completion in respect of the Non-Option
Sellers and 12 months in respect of the Option Sellers, interfere, seek to
interfere or take such steps as may interfere with or adversely affect or
influence supplies to any Group Company from any suppliers who have supplied
goods or services to any Group Company for use in connection with its trade or
business at any time during the 24 months prior to Completion provided always
that any such dealings shall or are likely to adversely affect the manner in
which the relevant supplier deals with the relevant Group Company;

 

  (d) in the period of three years from Completion in respect of the Non-Option
Sellers and 12 months in respect of the Option Sellers:

 

  (i) offer employment to or employ or offer to conclude any contract of
services with any Key Employee or procure or facilitate the making of such an
offer by any Person, firm or company; or

 

  (ii) solicit or approach or entice or endeavour to entice any Key Employee to
terminate their employment or contract for services with any Group Company,

 

whether or not such Person would commit any breach of his contract of employment
or contract for services by reason of so leaving the service of any Group
Company or otherwise; or

 

  (e) hold himself/herself out as being interested in or in any way connected
other than as:

 

  (i) a matter of historic fact;

 

  (ii) in the course of continued employment with a member of the Buyer’s Group;

 

  (iii) as a shareholder in a member of the Buyer’s Group

 

or permit any Person to hold out any Covenantor as being so interested.

 

7.2 For the purposes of this clause 7, a Covenantor will be concerned in a
business if he/she carries it on as principal or agent or employee or if at the
relevant time:

 

  (a) he/she is a partner, employee, consultant, director or agent in, of or to
any Person who carries on the business; or

 

  (b) he/she has any direct or indirect financial interest (as shareholder or
otherwise) in any Person who carries on the business; or

 

  (c) he/she is a partner, employee, consultant, director or agent in, of or to
any Person who has a direct or indirect financial interest (as shareholder or
otherwise) in any Person who carries on the business,

 

17

 

 

disregarding any financial interest of a Person in securities which are held for
investment purposes only if that Person, a Seller and any Person connected to it
(the “Investors”) are together interested in units of an authorised unit trust
and/or not more than three per cent (3%) of any class of the issued share or
loan capital of any company quoted on a recognised investment exchange (as
defined in FSMA) and provided that none of the Investors are involved in the
management of the business of the issuer of the securities or of any Person
connected with it other than by the exercise of voting rights attaching to the
securities.

 

7.3 Each party acknowledges that each of the restrictions in this clause 7 is no
more extensive than is reasonable and necessary to protect the interests of the
Buyer as the buyer of the Shares. Each Covenantor confirms that it has received
independent legal advice in relation to the terms of this clause 7.

 

7.4 Each Covenantor acknowledges that if any one of them breaches or violates
any of the provisions of this clause 7, the Buyer would be irreparably harmed
and have no adequate remedy at law and the applicable duration of the
restriction shall be extended for such period of the breach or violation.
Accordingly, each Covenantor agrees that, in addition to any claim for monetary
damages available to it, Buyer may (on behalf of itself or any Group Company)
seek to obtain injunctive relief of such other and further equitable relief as a
court of competent jurisdiction seated in the European Union, the United Kingdom
or the United States may deem to be appropriate in the circumstances.

 

7.5 Each Covenantor shall not, directly or indirectly, disparage any Group
Company or and of its post-Completion shareholders, directors, officers,
employees or agents. This clause 7.5 does not, in any way, restrict or impede
you from exercising protected rights to the extent that such rights cannot be
waived by agreement or from complying with any applicable law or regulation or a
valid order of a court of competent jurisdiction or an authorized government
agency, provided, that such compliance does not exceed that required by the law,
regulation, or order.

 

7.6 Each of the undertakings in clause is a separate undertaking by each Seller
in relation to himself or herself and his or her interests and shall be
enforceable by the Buyer and the Company separately and independently of their
right to enforce any one or more of the other undertakings contained in that
clause; provided, however, that the Buyer shall not be entitled to duplicate
recoveries.

 

7.7 The parties acknowledge that the Sellers have confidential information
relating to the Business and that the Buyer is entitled to protect the goodwill
of the Business as a result of buying the Shares. Accordingly, each of the
undertakings in clause 7 is considered fair and reasonable by the parties.

 

7.8 The consideration for the undertakings in clause 7 is included in the
Consideration.

 

8 SEVERAL LIABILITY

 

8.1 Unless expressly provided otherwise with respect to the Principal Sellers
(whose Warranties are joint and several), all Warranties, undertakings,
covenants, agreements and obligations made, given or entered into in this
Agreement by the Sellers and/or Sellers (as applicable) are made, given or
entered into severally by each of the Sellers and/or Sellers.

 

8.2 The Buyer may take action against any one or more of the Sellers and/or
Sellers and/or may release or compromise in whole or in part the liability of
any one or more of the Sellers and/or Sellers under this Agreement or grant any
time or other indulgence without affecting the liability of any other of the
Sellers and/or Sellers.

 

9 RELEASE BY THE SELLERS

 

9.1 Each of the Sellers confirms that, immediately following Completion, he
neither has any claim or has any reason to believe he will have a claim (whether
in respect of any breach of contract, compensation for loss of office or monies
due to him or on any account whatsoever (other than in respect of any accrued
salary and expenses since the prior month’s payroll under such Seller’s
respective employment agreement to the extent due and unpaid) outstanding
against the Company, any Group Company or any of their respective present or
former employees, directors or officers (together, the “Relevant Persons”) and
that no agreement or arrangement (other than the Transaction Documents or in
respect of the Option Sellers their existing employment contracts) is
outstanding under which the Company, any Group Company or Relevant Person has or
could have any obligation of any kind to him.

 

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9.2 To the extent that any such claim or obligation referred to in clause 9.1
exists, or may exist, each of the Sellers irrevocably and unconditionally waives
such claim or obligation and any unknown or contingent claim or obligation, and
releases the Company, any Group Company and Relevant Person from any liability
whatsoever in respect of such claim or obligation.

 

9.3 The Company, any Group Company or Relevant Person may enforce the terms of
this clause 9 in accordance with the Contracts (Rights of Third Parties) Act
1999.

 

10 ANNOUNCEMENTS

 

10.1 Save for the Announcement and except to the extent otherwise expressly
permitted by this Agreement, the parties shall keep confidential and not make
any public announcement or issue a press release or respond to any enquiry from
the press or other media concerning or relating to this Agreement or its subject
matter or any ancillary matter.

 

10.2 Notwithstanding any other provision in this Agreement, either party may,
after consultation with the other party whenever practicable and to the extent
permitted by law, make or permit to be made an announcement concerning or
relating to this Agreement or its subject matter or any ancillary matter if and
to the extent required by:

 

  (a) law; or

 

  (b) any securities exchange on which either party’s securities are listed or
traded; or

 

  (c) any regulatory or governmental or other authority with relevant powers to
which either party is subject or submits, whether or not the requirement has the
force of law; or

 

  (d) to the extent required under the constitutional or fund documentation of
the Institutional Investors.

 

10.3 Clause 10.1 shall not apply to any announcement, communication or circular
made or sent by a member of the Buyer’s Group after Completion to an employee,
customer, distributor or supplier of the Company or any Group Company informing
it of the Buyer’s purchase of the Shares (but not of any terms of this
Agreement).

 

11 CONFIDENTIALITY

 

11.1 Each of the Sellers hereby undertakes with the Buyer that it shall preserve
the confidentiality of the Non-Disclosable Information, and except to the extent
otherwise expressly permitted by this Agreement, take reasonable steps so as not
to directly or indirectly reveal, report, publish, disclose or transfer or use
for its own or any other purposes such Non-Disclosable Information.

 

11.2 The Buyer hereby undertakes with the Sellers for itself and on behalf of
each member of the Buyer’s Group that it shall preserve the confidentiality of
the Non-Disclosable Information that relates to the Sellers and to this
Agreement, and except to the extent otherwise expressly permitted by this
Agreement, take reasonable steps so as not to directly or indirectly reveal,
report, publish, disclose or transfer or use for its own or any other purposes
such Non-Disclosable Information.

 

11.3 Notwithstanding any other provision in this Agreement, the Sellers and/or
Buyer (as the case may be) may, after consultation with the other party (to the
extent permitted by law), disclose Non-Disclosable Information if and to the
extent:

 

19

 

 

  (a) required by law, including applicable federal and state securities laws of
the United States;

 

  (b) required by the rules of the Nasdaq Stock Market or any other securities
exchange in which the Class A Common Stock of Buyer is listed or trades; or

 

  (c) required by or for the purposes of making any returns or providing
information as required by, any regulatory or governmental or Tax Authority or
other authority with relevant powers to which the relevant Seller is subject or
submits (whether or not the authority has the force of law); or

 

  (d) required to vest the full benefit of this Agreement in the relevant party
or to enforce any of the rights of the relevant party in this Agreement; or

 

  (e) required by the relevant party’s professional advisers to provide their
services (and subject always to similar duties of confidentiality); or

 

  (f) that information is in or has come into the public domain through no fault
of the relevant party; or

 

  (g) the Buyer or the Institutional Investors or Sellers has/have given prior
written consent to the disclosure; or

 

  (h) necessary to obtain any relevant Tax clearances from any appropriate Tax
Authority.

 

11.4 The restrictions contained in this clause 11 shall continue to apply after
Completion without limit in time.

 

12 ENTIRE AGREEMENT

 

12.1 This Agreement and the Schedules and other documents referred to or
incorporated in it constitute the entire agreement between the parties relating
to the subject matter of this Agreement and supersede and extinguish any prior
drafts, agreements, undertakings, representations, warranties and arrangements
of any nature whatsoever, whether or not in writing, between the parties in
relation to the subject matter of this Agreement.

 

12.2 Each of the parties acknowledges and agrees that it has not entered into
this Agreement in reliance on any statement or representation of any Person
(whether a party to this Agreement or not) other than as expressly incorporated
in this Agreement. The Buyer agrees that rescission shall not be available as a
remedy for any breach of this Agreement and the Buyer shall not be entitled to
rescind or terminate this Agreement.

 

12.3 Nothing in this Agreement or in any other document referred to herein shall
be read or construed as excluding any liability or remedy as a result of fraud.

 

13 CUMULATIVE RIGHTS

 

The rights of the Buyer under this Agreement are independent, cumulative and
without prejudice to all other rights available to it whether as a matter of
common law, statute, custom or otherwise.

 

14 ASSIGNMENT AND TRANSFER

 

14.1 This Agreement is personal to the parties and no party may assign,
transfer, subcontract, delegate, charge or otherwise deal in any other manner
with this Agreement or any of its rights or obligations nor grant, declare,
create or dispose of any right or interest in it without the prior written
consent of:

 

  (a) the Buyer, in case of proposed dealing by a Seller; and

 

20

 

 

  (b) either of the Sellers’ Representatives, in case of proposed dealing by the
Buyer.

 

14.2 Any purported assignment, transfer, subcontracting, delegation, charging or
dealing in contravention of this clause 14 shall be ineffective.

 

14.3 In the event there is an assignment of the Buyer’s rights pursuant to this
Agreement, then the Sellers shall be under no greater liability to the assignee
than they were to the Buyer.

 

15 COSTS AND EXPENSES

 

Except as otherwise stated in this Agreement, each party shall pay its own costs
and expenses in relation to the negotiation, preparation, execution, performance
and implementation of this Agreement and each document referred to in it and
other agreements forming part of the transaction, save that this clause shall
not prejudice the right of either party to seek to recover its costs in any
litigation or dispute resolution procedure which may arise out of this
Agreement.

 

16 INTEREST ON LATE PAYMENTS

 

16.1 If a party fails to pay any sum payable by it on the due date for payment
under this Agreement, it shall pay interest on the overdue sum for the period
from and including the due date of payment up to the date of actual payment
(after as well as before judgment) in accordance with clause 16.2.

 

16.2 The interest referred to in clause 16.1 shall accrue from day to day and
shall be paid on demand at the rate of five per cent (5%) above the base rate
from time to time of the Bank of England.

 

17 WITHHOLDING & GROSSING-UP

 

If, in respect of or in connection with any Claim, or otherwise in connection
with any payment made under this Agreement, any amount payable to the Buyer by
the Sellers is subject to Taxation or a Seller is required by law to deduct or
withhold any amount of or in respect of Taxation from any such payment, the
amount to be paid to the Buyer by the Sellers shall be increased to such amount
as will ensure that the net amount received by the Buyer after such Taxation,
deduction or withholding has been taken into account is equal to the full amount
which would have been received and retained by the Buyer had the amount not been
subject to Taxation, deduction or withholding, provided that no greater amount
shall be payable under this clause 17 following any assignment or transfer by
the Buyer of any rights, or enforcement by any other Person of any rights of the
Buyer, under this Agreement than would have been payable in the absence of such
assignment, transfer or enforcement by another Person.

 

18 EFFECT OF COMPLETION

 

This Agreement together with the other Transaction Documents shall, to the
extent that they remain to be performed, continue in full force and effect
notwithstanding Completion.

 

19 WAIVER

 

19.1 A waiver of any right, power, privilege or remedy provided by this
Agreement must be in writing and may be given subject to any conditions thought
fit by the grantor. For the avoidance of doubt, any omission to exercise, or
delay in exercising, any right, power, privilege or remedy provided by this
Agreement shall not constitute a waiver of that or any other right, power,
privilege or remedy.

 

19.2 A waiver of any right, power, privilege or remedy provided by this
Agreement shall not constitute a waiver of any other breach or default by the
other party and shall not constitute a continuing waiver of the right, power,
privilege or remedy waived or a waiver of any other right, power, privilege or
remedy.

 

21

 

 

19.3 Any single or partial exercise of any right, power, privilege or remedy
arising under this Agreement shall not preclude or impair any other or further
exercise of that or any other right, power, privilege or remedy.

 

20 VARIATION

 

Any variation of this Agreement or of any of the documents referred to in it is
valid only if it is in writing and signed by or on behalf of each party.

 

21 SEVERANCE

 

21.1 If any provision of this Agreement is held to be invalid or unenforceable
by any judicial or other competent authority, all other provisions of this
Agreement will remain in full force and effect and will not in any way be
impaired.

 

21.2 If any provision of this Agreement is held to be invalid or unenforceable
but would be valid or enforceable if some part of the provision were deleted, or
the period of the obligation reduced in time, or the range of activities or area
covered, reduced in scope, the provision in question will apply with the minimum
modifications necessary to make it valid and enforceable.

 

22 FURTHER ASSURANCE

 

22.1 The Sellers shall at their own cost from time to time on or following
Completion, on being required to do so by the Buyer (acting reasonably), do or
procure the doing of all such acts and/or execute or procure the execution of
all such documents in a form satisfactory to the Buyer (acting reasonably) for
giving full effect to the transfer of the legal and beneficial interest in the
Shares to the Buyer.

 

22.2 Without limiting the generality of clause 22.1, if the legal title to
and/or the beneficial interest in and/or possession or control of any asset
which is used in the Business remains vested in any Seller or their Connected
Persons after Completion (the “Missing Asset”), the relevant Seller(s) or
Connected Person(s) shall:

 

  (a) be deemed to hold the Missing Asset in trust and/or as bailee for the
Company or relevant Group Company (as applicable); and

 

  (b) as soon as practicable procure that possession and control of, and title
to and any interest in, the Missing Asset is transferred to the Company or Group
Company (as applicable) (or as the Company or Group Company directs) on terms
that no consideration is provided by any Person for such transfer.

 

22.3 Without limiting the generality of clause 22.1, Principal Sellers hereby
covenant to (a) review the required securities filing for the Buyer, as provided
to the Principal Sellers by the Buyer with the U.S. Securities and Exchange
Commission (“SEC”) following Completion to the extent that such filing discloses
information concerning the business, management, share ownership of the
Principal Sellers and related information concerning the Group Companies and/or
the Sellers, (b) provide comments to drafts of such proposed filing furnished by
the Buyer, and (c) will use their commercially reasonable efforts to ensure that
such disclosures are true and accurate in all material respects and do not omit
disclosures that, are necessary to make the statements contained therein, within
the context made, not materially misleading. The Principal Seller’s obligations
pursuant to this clause 22.3 shall expire 1) 6 months following Completion in
relation to reviewing business, management, and related information concerning
the Group Companies, and 2) on the date the Principal Sellers cease to hold any
shares in the Buyer in respect of reviewing any share ownership information
concerning the Principal Seller’s (or their Connected persons) ownership of
shares in the Buyer.

 

22.4 Each Seller agrees to notify the Buyer as soon as practicable upon it
coming to its attention that there are any Missing Assets in their possession or
control.

 

22

 

 

22.5 The parties shall each use their best endeavours to procure that Sahara
Presentation Systems Plc is re-registered as a limited company (the
Re-registration) as soon as reasonably practicable following Completion.

 

22.6 The Buyer hereby undertakes to the Sellers on behalf of itself and on
behalf of each member of the Buyer’s Group to instruct and direct the Sellers’
Solicitors to hold the £12,000,000 cash currently held by the Sellers’
Solicitors on behalf of Sahara Presentation Systems Plc (Client Cash) as follows

 

  (a) The Buyer shall, no later than the Business Day following Re-registration,
instruct the Sellers’ Solicitors to release the Client Cash to the Sellers in
satisfaction of its obligation to make the Balancing Payment.

 

  (b) To the extent that some or all of the Balancing Payment has been paid by
the Buyer to the Sellers using cash other than the Client Cash, the Buyer shall
instruct and direct the Sellers’ Solicitors to return to the Buyer (or to such
other party as the Buyer shall direct) such amount of the Client Cash as is
equal to the amount of the Balancing Payment as has been paid to the Sellers.

 

23 SELLERS’ REPRESENTATIVES

 

23.1 Each of the Sellers hereby appoint the Sellers’ Representatives to act as
their representatives and agree that the Buyer may rely, without enquiry, upon
any action of any of the Sellers’ Representatives as the act of the Sellers in
all matters referred to in this Agreement as being carried out by either of the
Sellers’ Representative.

 

23.2 At any time, the Sellers may appoint a replacement Sellers’ Representative
by decision taken by the Sellers holding the majority of the Shares immediately
prior to Completion. Any such successor shall agree in writing to accept the
appointment, and such appointment shall be promptly (and in any event within
five Business Days) notified to the Buyer in writing.

 

23.3 The Sellers undertake that at least one Sellers’ Representative shall be
appointed at all times.

 

24 NOTICES

 

24.1 Any communication to be given in connection with this Agreement shall be in
writing in English except where expressly provided otherwise and shall either be
delivered by hand or email. Delivery by courier shall be regarded as delivery by
hand.

 

24.2 Such communication shall be sent to the address of the relevant party
referred to in this Agreement or email address set out below or to such other
address or email address as may previously have been communicated to the other
party in accordance with this clause 24.2 and clause 24.5. Each communication
shall be marked for the attention of the relevant Person.

 

Party   Email address   For the attention of           Sellers’ Representatives
  kbatley@hotmail.co.uk   Kevin Batley               nigel.batley@btinternet.com
  Nigel Batley           with a copy (which shall not constitute notice) to  
salim.somjee@crippspg.co.uk   Salim Somjee           Buyer  
michael.pope@boxlight.com   Michael Pope           with a copy (which shall not
constitute notice) to:   sweiss@mrllp.com   Stephen A. Weiss

 

23

 

 

24.3 A communication shall be deemed to have been served:

 

  (a) if delivered by hand at the address referred to in clause 24.2, at the
time of delivery; or

 

  (b) if sent by email to the email address specified in clause 24.2, at the
time of completion of transmission by the sender, except that if the sender
receives a notification of message delivery failure the notice shall not be
deemed to have been served;

 

If a communication would otherwise be deemed to have been delivered outside
normal business hours (being 9:30 a.m. to 5:30 p.m. on a Business Day) in the
time zone of the territory of the recipient under the preceding provisions of
this clause 24.2, it shall be deemed to have been delivered at the next opening
of such business hours in the territory of the recipient.

 

24.4 In proving service of the communication, it shall be sufficient to show
that delivery by hand was made or that the email was transmitted to the correct
email address, whether or not opened or read by the recipient.

 

24.5 A party may notify the other parties to this Agreement of a change to its
name, relevant Person, address or email address for the purposes of clause 24.2
provided that such notification shall only be effective on:

 

  (a) the date specified in the notification as the date on which the change is
to take place; or

 

  (b) if no date is specified or the date specified is less than five clear
Business Days after the date on which notice is deemed to have been served, the
date falling five clear Business Days after notice of any such change is deemed
to have been given.

 

24.6 Any communication required to be given to all or any of the Sellers in
connection with this Agreement shall be deemed to be given if it is given to the
Sellers’ Representatives, such Sellers’ Representatives receiving such
communication as agent for the other Sellers. Service of any communication on
the last known Sellers’ Representatives shall be deemed to constitute valid
service thereof on all or any of the Sellers.

 

24.7 For the avoidance of doubt, the parties agree that the provisions of
clauses 24.1, 24.2, 24.3, 24.4 and 24.5 shall not apply in relation to the
service of any claim form, application notice, order, judgment or other document
relating to or in connection with any proceeding, suit or action arising out of
or in connection with this Agreement.

 

25 COUNTERPARTS

 

This Agreement may be executed in any number of counterparts, each of which
shall constitute an original, and all the counterparts shall together constitute
one and the same agreement.

 

26 GOVERNING LANGUAGE

 

26.1 If this Agreement or any other Transaction Document is translated into any
language other than English, the English language text shall prevail in any
event.

 

26.2 Each notice, instrument, certificate or other communication to be given by
one party to another in connection with this Agreement or any other Transaction
Document shall be in English (being the language of negotiation of this
Agreement) and in the event that such notice, instrument, certificate or other
communication is translated into any other language, the English language text
shall prevail.

 

27 SUCCESSORS

 

This Agreement is made for the benefit of the parties and their successors and
permitted assigns, and the rights and obligations of the parties under this
Agreement shall continue for the benefit of, and shall be binding on, their
respective successors and permitted assigns.

 

24

 

 

28 RIGHTS OF THIRD PARTIES

 

Except as otherwise expressly stated herein, this Agreement does not confer any
rights on any Person or party (other than the parties to this Agreement)
pursuant to the Contracts (Rights of Third Parties) Act 1999.

 

29 RIGHTS & REMEDIES

 

Except as expressly provided in this Agreement, the rights and remedies provided
under this Agreement are in addition to, and not exclusive of, any rights or
remedies provided by law.

 

30 DISPUTE RESOLUTION

 

In the event of a dispute arising out of or relating to the interpretation or
application of this Agreement, including any question regarding its existence,
validity or termination (‘Dispute’) which the parties cannot resolve by mutual
agreement, the parties shall first seek settlement of the Dispute by mediation
in accordance with the London Court of International Arbitration (LCIA)
Mediation Procedure, which Procedure is deemed to be incorporated by reference
into this clause. No party may commence any court proceedings in relation to the
Dispute until it has attempted to settle the Dispute by mediation and either the
mediation has terminated or the other party has failed to participate in the
mediation, provided that the right to issue proceedings is not prejudiced by a
delay. If the Dispute is not settled by mediation within 30 Business Days of the
appointment of the mediator, or such further period as the parties shall agree
in writing, then any party may commence court proceedings in relation to the
Dispute.

 

31 GOVERNING LAW

 

This Agreement and any dispute or claim arising out of or in connection with it
or its subject matter, whether of a contractual or non-contractual nature, shall
be governed by and construed in accordance with the law of England and Wales.

 

32 JURISDICTION

 

The parties irrevocably agree that the courts of England and Wales located in
London shall have exclusive jurisdiction to settle any dispute which may arise
out of or in connection with this Agreement in respect of any claim brought
against the Buyer and shall have non-exclusive jurisdiction in respect of any
claim brought by the Buyer.

 

33 EXECUTION

 

This Agreement is executed as a deed by the parties and is delivered and takes
effect on the date at the beginning of this Agreement.

 

25

 

 

Schedule 1

 

The Sellers

 

(1)

Name and address

 

(2)

Number of Ordinary Shares

  

(3)

Number of Option Shares

  

(4)

Exercise Amount

  

(5)

Series B Consideration Shares

 

(6)

Series C Consideration Shares

 

(7)

Completion Payment

  

(8)

Balancing Payment

  

(9)

% of Consideration

  Kevin Batley
5 Ashley Road Sevenoaks, Kent, TN13 3AN   4,400 A ordinary shares of £0.01
each    -    -   668,878 shares  557,399 shares  £16,880,000   £5,064,000  
 42.2% Nigel Batley
28 Brattle Wood, Sevenoaks, Kent, TN13 1QU   4,400 C ordinary shares of £0.01
each    -    -   668,878 shares  557,399 shares  £16,880,000   £5,064,000  
 42.2% Sheila Batley
5 Ashley Road, Sevenoaks, Kent, TN13 3AN   100 B ordinary shares of £0.01 each,
and 500 A ordinary shares of £0.01 each    -    -   91,939 shares  75,949
shares  £2,3000,000   £690,000    5.75% Annette Batley
28 Brattle Wood, Sevenoaks, Kent, TN13 1QU   100 D ordinary shares of £0.01
each, and 500 C ordinary shares of £0.01 each    -    -   91,939 shares  75,949
shares  £2,3000,000   £690,000    5.75% Shaun Marklew
Caxton House, Hurtis Hill, Crowborough, East Sussex, TN6 3BL   -    213 B
ordinary shares of £0.01 each   £0.00   32,493 shares  27,077 shares  £820,000  
£246,000    2.05  Simon Chidsey
6 Parker Lane, Mirfield, West Yorkshire, WF14 9NY   -    213 B ordinary shares
of £0.01 each   £0.00   32,493 shares  27,077 shares  £820,000   £246,000  
 2.05  TOTAL   10,000    426        1,585,020 shares  1,320,850 shares 
£40,000,000   £12,000,000    100 

 

26

 

 

Schedule 2

 

Part 1: Particulars of the Company

 

Company name   Sahara Holdings Limited Registered number   03947832 Date of
incorporation   14 March 2000 Place of incorporation   England & Wales Address
of registered office   Europa House Littlebrook Dc1, Shield Road, Dartford,
Kent, England, DA1 5UR Issued share capital  

4,900 A ordinary shares of £0.01 each

526 B ordinary shares of £0.01 each

4,900 C ordinary shares of £0.01 each

100 D ordinary shares of £0.01 each

Charges   N/A Directors  

Nigel Batley

Kevin Batley

Annette Batley

Sheila Batley

Secretary   Nigel Batley Accounting reference date   31 December Auditors   BDO
LLP

 

27

 

 

Part 2: Particulars of the Subsidiaries

 

Company name   Sahara Presentation Systems plc Registered number   01335211 Date
of incorporation   14 March 2000 Place of incorporation   England & Wales
Address of registered office   Europa House Littlebrook Dc1, Shield Road,
Dartford, Kent, England, DA1 5UR Issued share capital   50,440 ordinary shares
of £1 each Charges  

Fixed charge, floating charge and negative pledge in favour of Barclays Bank plc
created on 31 July 2014

Debenture in favour of Barclays Bank plc created on 5 April 1990

Directors  

Nigel Batley

Kevin Batley

Mark Starkey

Shaun Marklew

Adam Kingshott

John Ginty

Patrick Foley

Simon Chidsey

Secretary   Nigel Batley Accounting reference date   31 December Auditors   BDO
LLP

 

28

 

 

Company name   Sedao Limited Registered number   05217995 Date of incorporation
  31 August 2004 Place of incorporation   England and Wales Address of
registered office   Europa House, Shield Road, Dartford, England DA1 5UR Issued
share capital   100 ordinary shares of £1 each Charges   None Directors   Nigel
Batley Secretary   None Accounting reference date   31 December Auditors   BDO
LLP

 

29

 

 

Company name   Sahara Nordic AB Registered number   5568260003 Date of
incorporation   17 November 2010 Place of incorporation   Sweden Address of
registered office   C/O Oscarshamns Business Centre, Södra Långgatan 15 – 17,
572 33 OSKARSHAMN, KALMAR Issued share capital   500 Shares at 100 SEK each
Charges   None Directors  

Kevin Batley

Nigel Batley

Secretary   None Accounting reference date   31 December Auditors   BDO

 

30

 

 

Company name   Sahara Nordic OY Registered number   24282575 Date of
incorporation   Finland 26 August 2011 Place of incorporation   Finland Address
of registered office   Laivalahden Puistotie 10, 00810 Helsinki Issued share
capital   100 Shares at €25 each Charges   None Directors  

Kevin Batley

Nigel Batley

Secretary   None Accounting reference date   31 December Auditors   BDO

 

31

 

 

Company name   Sahara Presentation Systems, Inc Registered number   6778018
Delaware Date of incorporation   1 March 2018 Place of incorporation   Delaware,
USA Address of registered office   Suit Number 100, 401 West 6th Street,
Georgetown, TX78626. Please refer to document 1.7.3. Issued share capital   100
no par value common shares Charges   None Directors  

Kevin Batley

Nigel Batley

Secretary   Nigel Batley Accounting reference date   31 December Auditors   BDO

 

32

 

 

Company name   Sahara Presentation Systems GmbH Registered number   HRB 85523
Date of incorporation   15 January 2019 Place of incorporation   Germany Address
of registered office   3rd Floor Johannstr. 37 40476 Düsseldorf Issued share
capital   25,000 Shares at €1 each Charges   None Directors  

Kevin Batley

Nigel Batley

Secretary   None Accounting reference date   31 December Auditors   BDO

 

33

 

 

Company name   Clevertouch B.V. Registered number   76186458 Date of
incorporation   24 October 2019 Place of incorporation   The Netherlands Address
of registered office   Office Room 13, The Mixer, Landdrostlaan 51 te Apeldoorn
Issued share capital   250 Shares at €100 each Charges   None Directors  

Kevin Batley

Nigel Batley

Secretary   None Accounting reference date   31 December Auditors   BDO

 

34

 

 

Schedule 3

 

Part 1: Documents to be delivered by the Sellers

 

At Completion:

 

1. each Seller shall deliver to the Buyer (or the Buyer’s Solicitors):

 

  a. duly executed transfer(s) in respect of the Shares to be transferred by it
and the share certificate(s) for the Shares (or an indemnity in lieu thereof);

 

  b. an exercise form duly executed by each Option Seller in respect of his
Options;

 

  c. an election in a form reasonably required by the Company for the transfer
of liability of employer national insurance contributions in respect of exercise
of any Options by the relevant Option Seller, duly executed by each Option
Seller;

 

  d. an election under section 431 of the Income Tax (Earnings and Pensions) Act
2003, in respect of the issue to each Option Seller of shares on exercise of
their Options, duly executed by each Option Seller;

 

  e. a duly executed power of attorney in respect of the exercise of the voting
rights conferred on it by its Shares in the period after Completion;

 

  f. the Disclosure Letter, duly executed;

 

  g. the registers, minute books and other records required to be kept by the
Company under the CA 2006, in each case properly written up as at the Completion
Date, together with the common seals (if any), certificates of incorporation and
any certificates of incorporation on change of name for each of the Company; and

 

  h. a duly executed copy of the Voting and Lockup Agreement.

 

2. the Sellers shall deliver to the Buyer (or the Buyer’s Solicitors):

 

  a. the resignations in the agreed form of each of Annette Batley and Sheila
Batley from their position as Directors of the Company and each Group Company;
as well as the resignations of Nigel Batley, Mark Starkey, Shaun Marklew, Adam
Kingshott, John Ginty, Patrick Foley and Simon Chidsey as Directors of Sahara
Presentation Systems Plc

 

  b. the Variation to Service Agreements duly executed by each party to them;

 

  c. signed board minutes and resolutions of the Company in the agreed form
approving the transfers of the Shares, the resignations of Sheila Batley and
Annette Batley as directors of the Company and each Group Company and the
appointment of Mark Starkey, Michael Pope, Takesha Brown, Hank Nance and Daniel
Leis as directors of the Company and Michael Pope and Takesha Brown as directors
of Sahara Presentation Systems Plc;

 

  d. all records, correspondence, documents, files, filing codes, memoranda and
other papers and information relating to each Group Company or the Business not
kept at the Properties or not otherwise in possession of the relevant Group
Company;

 

  f, Letter of Non-Crystallisation in relation to the Debenture in favour of
Barclays Bank plc created on 5 April 1990 in relation to the Company;

 

  g. statements from each bank at which the Group Companies has an account,
giving the balance of such accounts at the close of business on the last
Business Day before Completion;         h. details of Group Companies cash book
balances; and

 

  i reconciliation statements reconciling the cash book balances with the bank
statements delivered above.

 

35

 

 

Part 2: Documents to be delivered by the Buyer

 

1. At Completion, the Buyer shall deliver to the Sellers (or the Sellers’
Solicitors):

 

  a. a counterpart of the Disclosure Letter, duly executed by the Buyer;

 

  b. a copy of the minutes of a meeting of the directors of the Buyer
authorising the execution by the appropriate signatories on behalf of the Buyer
of the relevant Transaction Documents;

 

  c. any power of attorney under which any Transaction Document has been
executed;

 

  d. a copy of the form of Series B Consideration Shares Certificate and Series
C Consideration Shares Certificate;

 

  e. within three Business Days after Completion, evidence of filing of the
Series B Consideration Shares Certificate and Series C Consideration Shares
Certificate with the Secretary of State of the State of Nevada;

 

  f. within three Business Days after filing of the Series B Consideration
Shares Certificate and Series C Consideration Shares Certificate has been
approved by the Secretary of State of the State of Nevada, Share certificates
evidencing the Series B Consideration Shares and Series C Consideration Shares;

 

  g. on or following Completion, the Buyer will permit Key Employees of the
Group Companies (to be allocated among such Persons as mutually agreed upon
between the Principal Sellers and the Buyer) to be granted restricted stock
units (“RSU’s”) entitling such Persons to purchase (i) up to 3,000,000 shares of
Buyer’s Class A Common Stock which shall vest monthly over a period of
forty-eight (48) months from Completion, plus (ii) such additional RSU’s as may
be determined by the Board of Directors of Buyer on a case by case basis; and

 

  h. a duly executed copy of the Voting and Lockup Agreement.

 

36

 

 

Schedule 4

 

Warranties

 

1 Capacity and authority

 

Capacity and Authority of the Sellers

 

1.1 Each of the Sellers has the requisite capacity and authority to enter into
and perform this Agreement and each of the Sellers’ Completion Documents.

 

1.2 Each Seller has not:

 

  (a) had a bankruptcy petition presented against them or been declared
bankrupt;

 

  (b) been served with a statutory demand, or is unable to pay any debts within
the meaning of the Insolvency Act 1986;

 

  (c) entered into, or has proposed to enter into, any composition or
arrangement with, or for, their creditors (including an individual voluntary
arrangement); or

 

  (d) been the subject of any other event analogous to the foregoing in any
jurisdiction.

 

Effect of Completion

 

1.3 This Agreement and the Sellers’ Completion Documents will, when executed by
the Sellers, constitute binding obligations of the Sellers enforceable in
accordance with their respective terms.

 

1.4 The entry by the Sellers into this Agreement and, as applicable, into each
of the Sellers’ Completion Documents to which it is or will be a party and the
performance by each of the Sellers of its obligations under this Agreement and
each Sellers’ Completion Document does not and will not:

 

  (a) conflict with, result in a breach of or constitute a default under any
Group Company’s memorandum, articles of association or equivalent document, or
any agreement or instrument to which such Seller is a party (other than any
confidentiality provisions); or

 

  (b) conflict with or result in a breach of any applicable law or regulation,
or of any order, decree or judgment of any court, governmental agency or
regulatory authority, that applies to such Seller.

 

2 The Shares

 

2.1 Each of the Sellers is the sole legal and beneficial owner of the Shares (or
in the case of the Option Sellers, the Option Shares) set opposite his/her name
in Schedule 1, and the Shares constitute the whole of the issued and allotted
share capital of the Company and are duly authorized, validly issued, and fully
paid or credited as fully paid.

 

2.2 There is no Encumbrance on, over or affecting the Shares or any of them, nor
any agreement or commitment to create any such Encumbrance and no claim has been
made that any Person is entitled to any such Encumbrance.

 

2.3 Save only as provided in this Agreement and the Options (all of which shall
be exercised prior to Completion), there are no contracts, agreements or
arrangements outstanding which call for the allotment, issue or transfer of, or
accord to any Person the right to call for the allotment, issue or transfer of,
the Shares, or any other shares, or any debentures in or securities of any Group
Company.

 

37

 

 

3 The Company

 

Incorporation and existence

 

3.1 Each Group Company is duly incorporated and validly existing under the laws
of the jurisdiction in which it is incorporated. Each Group Company has all
necessary organizational power and authority to own, operate or lease the
properties and assets now owned, operated or leased by it and to carry on the
Business as currently conducted. Each Group Company is duly licensed or
qualified to do business in each jurisdiction in which the operation of the
Business as currently conducted makes such licensing or qualification necessary.

 

3.2 No Group Company has agreed to acquire, any shares, securities or other
interests in, any other Person or undertaking.

 

3.3 The information contained in Schedule 2 relating to the Company and its
Subsidiaries is true and accurate.

 

Subsidiaries

 

3.4 The Subsidiaries are the only subsidiaries of the Company, and the Company
does not have and has never had any subsidiary other than the Subsidiaries.

 

3.5 The number of shares in each of the Subsidiaries set out in Part 2 of
Schedule 2 comprise the whole of the issued and allotted share capital of the
Subsidiaries and all of them are issued fully paid or credited as fully paid.
There is no Encumbrance on, over or affecting the shares of the Subsidiaries,
nor any agreement or commitment to create any such Encumbrance and no claim has
been made that any Person is entitled to any such Encumbrance.

 

No partnership

 

3.6 The Group Companies do not act or carry on business in partnership with any
other Person, are not a member (other than as a shareholder) of any corporate or
unincorporated body, undertaking or association, and do not hold and are not
liable in respect of any share or security which is not fully paid or which
carries any liability.

 

Share capital

 

3.7 The Company has not at any time in the last six years:

 

  (a) issued or allotted any shares in excess of its authorised share capital;

 

  (b) repaid, redeemed or purchased or agreed to repay, redeem or purchase any
securities or shares of any class of its share capital or otherwise reduced or
agreed to reduce its issued share capital or any class thereof;

 

  (c) issued or agreed or resolved to issue securities or shares of any class
otherwise than for cash;

 

  (d) held any of its shares as treasury shares or sold or transferred any
shares that immediately before such sale or transfer were held by it as treasury
shares;

 

  (e) directly or indirectly provided any financial assistance for the purpose
of the acquisition of shares of the Company or of any holding company of the
Company or for the purpose of reducing or discharging any liability incurred in
any such acquisition;

 

  (f) capitalised or agreed to capitalise in the form of shares, debentures or
any other securities or in paying up any amounts unpaid on any shares,
debentures or other securities any profits or reserves of any class or
description or passed or agreed to pass any resolutions to do so;

 

38

 

 

  (g) received an unlawful distribution from any company; or         (h)
declared, paid or made a dividend or other distribution otherwise than in
accordance with the articles of association of the Company and the applicable
laws.         (i) No shares in the capital of the Company have been issued, and
no transfer of any such shares has been registered, except in accordance with
all applicable laws and the memorandum and articles of association of the
Company (as the case may be), and all such transfers have been duly stamped
(where applicable).         (j) No warning notice or restrictions notice has
been issued under Schedule 1B (Enforcement of disclosure requirements) of the CA
2006 in respect of any shares or voting rights in, or any right to appoint or
remove any member of the board of directors of, the Company

 

Joint ventures

 

3.8 No Group Company is or has in the last six years been party to any joint
venture, consortium, partnership or profit sharing arrangement or agreement.

 

Historic acquisitions and disposals

 

3.9 In respect of all contracts entered into by a Group Company relating to the
acquisition or disposal of companies or businesses during the last six years or
longer if such contract imposes an obligation or liability on a Group Company
which remains binding (the “Historic Sale Contracts”):

 

  (a) accurate and not misleading copies of such Historic Sale Contracts are
contained in the Data Room;         (b) no Group Company, or any counterparty,
is in material breach of any of a Historic Sale Contract, and, so far as the
Sellers are aware, there are no circumstances existing that may give rise to any
such breach; and         (c) all consideration owed under such Historic Sale
Contracts has been paid, and there is no consideration which could become
payable under a Historic Sale Contract in the future.

 

Commissions and Brokers Fees

 

3.10 No Person is entitled to receive from a Group Company any finder’s fee,
brokerage or other commission in connection with the sale and purchase of the
Shares.

 

4 Arrangements with the Sellers

 

Connected party arrangements

 

4.1 During the three-year period prior to the date of this Agreement there were
no, and there are not currently outstanding, any contracts, agreements or
arrangements (including customer and supply contracts) to which the Company is a
party and in which any Seller or any director, officer, or shareholder of the
Company or any of their respective Connected Persons is interested (and for the
purposes of this paragraph a Person shall be deemed to be interested in a
contract if, were he a director of the Company, he would be interested in that
contract for the purposes of section 177 Companies Act 2006) save for employment
contracts in the ordinary course of business.

 

39

 

 

Competition with the Sellers

 

4.2 Save through the Company, none of the Sellers nor any other Person who is a
director of any Seller or is a Connected Person in relation to any Seller
(whether alone or for, together with or as agent or officer of any other Person,
firm or company or through the medium of any company, partnership,
unincorporated body or otherwise) carries on or is engaged, concerned or
interested, whether directly or indirectly, in any company or business which
competes with (or it is currently contemplated may become competitive with) or
trades with the Business.

 

Operation of the Business

 

4.3 The Business does not depend on the use of assets owned by or facilities or
services provided by any of the Sellers which are not being acquired pursuant to
this Agreement and no further steps will be required to be taken to enable the
Buyer, at Completion, to carry on the Business as carried on immediately prior
to Completion.

 

5 Change of control

 

As a result of the acquisition of the Shares by the Buyer:

 

  (a) no party will be entitled to terminate any material agreement or
arrangement with the Company (including, but not limited to, the Key Contracts);
        (b) no Key Supplier is entitled to cease or reduce or, so far as the
Sellers are aware, will cease or reduce its supplies to the Company;         (c)
no Key Customer is entitled to cease dealing with or reduce the level of
business with the Company or, so far as the Sellers are aware, will cease
dealing with or reduce the level of business done with the Company;         (d)
no officer of the Company or Key Employee will become entitled to any payment or
benefit or entitled to treat himself as redundant or otherwise dismissed or
released from any obligation or, so far as the Sellers are aware, will leave the
Company (other than as may be provided for in this Agreement); and

 

  (e) no licence, consent or other permission or approval required for or in
connection with the carrying on of the Business will terminate or be revoked or
become capable of termination or revocation.

 

  6 Accuracy of information

 

Information in this Agreement

 

6.1 The information contained or referred to in Schedule 1 in respect of Share
ownership and in Schedule 2 is true and accurate.

 

Records

 

6.2 The records, statutory books and books of account of the Company are duly
written up and maintained in accordance with all applicable legal requirements
and all such books and all records and documents (including all documents of
title, accounts, books, ledgers and contracts to which it is a party) which are
the property of the Company are in its possession or under its control and all
accounts, documents, returns and forms required to be delivered or made to the
Registrar of Companies and any relevant foreign equivalent have been duly and
correctly delivered or made.

 

Constitutional documents

 

6.3 The copies of the memorandum and articles of association of the Company as
set out in the Disclosure Letter, are complete and accurate in all respects,
have attached to them all resolutions, amendments and other documents required
by law to be so attached and fully set out the rights and restrictions attaching
to each class of share capital of the Company.

 

40

 

 

6.4 All dividends or distributions declared, made or paid by the Company have
been declared, made or paid in accordance with its memorandum and articles of
association, all applicable laws and regulations and any agreements or
arrangements made with any third party regulating the payment of dividends and
distributions.     6.5 All deeds and documents belonging to the Company, or to
which any of them is a party, are in the possession of the Company or the
relevant Subsidiary (as the case may be).

 

7 Accounts

 

True and fair view

 

7.1 The Accounts:

 

  (a) have been prepared in accordance with the relevant Accounts Standards; and
        (b) give a true and fair view of the assets, liabilities and financial
position of the Company at the Accounts Date and of the profits and losses for
the period covered by the Accounts.

 

7.2 So far as the Seller are aware, there are no material liabilities (whether
actual, future, contingent, unqualified or disputed) which existed at the
Accounts Date and which, pursuant to the Accounts Standards, was not permitted
or required to be provided for or disclosed in the Accounts.

 

Consistency of preparation

 

7.3 The Accounts have been prepared on a basis consistent with the accounting
policies, practices, estimation techniques, methods, assumptions and procedures
used in the preparation of the accounts of the Company for the three consecutive
accounting periods ending on 31 December 2019.     7.4 The Accounts (save as the
Accounts expressly disclose) are not affected by any exceptional or
non-recurring items; and     7.4 The Accounts have been audited by an individual
or firm registered to act as auditors in the UK and the auditors’ reports
thereon are unmodified.

 

7.5 The Accounts have been:

 

  (a) circulated to every person entitled to receive a copy in accordance with
section 423 of the CA 2006; and         (b) laid before the Company in general
meeting, where required by the CA 2006 or the articles of association of the
relevant company; and         (c) filed with the Registrar of Companies,        
in each case in accordance with the relevant requirements of the CA 2006 and all
other applicable laws and regulations in the UK.

 

41

 

 

7.6 Changes since 31 December 2019

 

Since 31 December 2019:

 

  (a) there has been no Material Adverse Effect or other material adverse change
in the turnover or financial position of the Company;         (b) the Company
has not issued or agreed to issue any share or loan capital other than pursuant
to the EMI Options;         (c) the Company has not borrowed or raised any money
or given or taken any form of financial security;         (d) no capital
expenditure has been incurred on any individual item by the Company in excess of
£100,000.00 and the Company has not acquired, invested or disposed of (or agreed
to acquire, invest or dispose of) any individual item in excess of £100,000.00;
        (e) there has been no abnormal increase or reduction of inventory, nor
has the Company offered price reductions or discounts or allowances on sales of
inventory, or inventory at less than its value in the Accounts outside of the
usual course of business;         (f) the Company has paid its creditors within
the applicable periods agreed with the relevant creditor and there are no
amounts owing by the Company which have been outstanding for more than 60 days
of their due date for payment; and         (g) there has been no change in the
issued share capital of the Company or in the legal or beneficial ownership of
the Company;         (h) no dividend or other distribution (whether in cash,
stock or in kind) has been (or has been deemed) declared, authorised, paid or
made, by the Company;         (i) no resolution of the Company in general
meeting has been passed other than resolutions relating to ordinary business at
annual general meetings;         (j) the business of the Group Companies has
been carried on in the ordinary course and so as to maintain it as a going
concern;         (k) the Company has not acquired or disposed of or agreed to
acquire or dispose of any business or any material asset, interest in any share,
debenture or security of any company, or undertaking;         (l) no material
change has been made in the emoluments or other terms of employment of any of
the Key Employees and the Company has not paid any bonus or special remuneration
to any such Key Employee outside of the ordinary course of business;         (m)
the Company has not placed any of its employees on furlough; and         (n) the
terms (including as to amount) of any commission, rebate or discount agreements
or arrangements between the Company and its Key Suppliers, Key Customers have
not been materially altered or renegotiated.

 

7.9 Financial and other records

 

All financial and other records of the Company (Records):

 

  (a) have been properly prepared and maintained;         (b) constitute an
accurate record of all matters required by law to appear in them, and in the
case of the accounting records, comply with the requirements of section 386 and
section 388 of the CA 2006;         (c) so far as the Sellers are aware, do not
contain any material inaccuracies or discrepancies; and         (d) are in the
possession of the Company.

 

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7.8 No notice has been received or allegation made that any of the Records are
incorrect or should be rectified.

 

8 Management Accounts; Working Capital and Financial Projections

 

Disclosure

 

8.1 Having regard to the purpose for which they have been prepared, the 2020
Management Accounts:

 

  (a) disclose with reasonable accuracy the financial position of the Company at
each date and for the period to which they relate;         (b) are not affected
to any material extent by any exceptional or non-recurring item.

 

8.2 Accurate copies of the Management Accounts are contained within the
Disclosure Bundle.     8.3 At Completion, and in addition to the Cash Reserves,
the Group Companies will have working capital (defined as consolidated current
assets (including but not limited to cash, inventory and pre-payments) over
consolidated current liabilities), which the Principal Shareholders reasonably
believe is adequate to conduct the Business in the ordinary course as conducted
in the 12 month period prior to Completion.     8.4 As far as the Principal
Shareholders are aware, the financial projections furnished to the Buyer for the
three fiscal years ending 2023 and contained at folder 3.9 of the Disclosure
Bundle, are based on assumptions that are deemed reasonable by the Principal
Shareholders and Key Employees, and do not include projected turnover or profits
regarding any planned or future products that are not currently sold by the
Group Companies (for the avoidance of doubt, the assumptions are based on the
prevailing economic climate as at Completion and do not include any
macro-economic effects that are outside of the control of the Group Companies).

 

9 Employees

 

The Employees

 

9.1 Data Room document 7.9.15 sets out an accurate list of all Employees (the
“Employee List”) and, save as set out in the Employee List, there are no other
Persons employed by the Company who are providing services to or assigned to the
Business, or who will transfer to, or become the responsibility of (in whole or
in part), the Company as a result of entering into this Agreement, or upon
Completion.     9.2 The Employee List contains accurate details of:

 

  (a) the contract commencement date and type, date on which continuous
employment commenced, job title, remuneration and all privileges or benefits
(whether or not contractual entitlements and whether in cash or in kind),
fixed-term/permanent status, notice period and other termination entitlements,
place of work, employing entity of each Employee and Worker;

 

  (b) those Employees and Workers who are absent from work and whose absence has
lasted or is expected to last one month or more, whether due to secondments,
sabbaticals, maternity, adoption, paternity, parental, shared parental leave or
other family-related leave, sickness or injury or disability or other long-term
leave of absence and who have or may have a statutory or contractual right to
return to work with the Company (including last working day and expected date of
return if known);

 

43

 

 

  (c) any Employee or Worker currently in their notice period, specifying
whether notice was given by the Company, and if so the reason(s), or by the
Employee or Worker; and         (d) in respect of Workers, terms governing the
ownership of intellectual property rights.

 

9.3 No offer of a contract of service, or of employee shareholder status, or for
services has been made by the Company to any individual which has not yet been
accepted or which has been accepted but where the individual’s
employment/engagement has not yet started.

 

Terms and conditions

 

9.4 The Sellers have provided the Buyer with copies of, or where no agreement or
documents exist, details of the following:

 

  (a) all directors’ service agreements and service agreements for all other Key
Employees;         (b) examples of all pro-forma contracts of employment and
statements of terms and conditions for all Employees;         (c) staff/employee
handbooks, and all other benefits, procedures, schemes and policies relating to
any of the Employees or Workers; and         (d) all employee bonus, commission
or incentive schemes or arrangements in which any Employee, Worker or director
of the Company or any of their associates or nominees participates, is eligible
to participate or has previously participated.

 

9.5 All contracts of service or for services with Employees and Workers can be
terminated by three months’ notice or less without giving rise to any claim for
damages or compensation (other than a statutory redundancy payment or statutory
compensation for unfair dismissal, if applicable).

 

Employment history (including redundancies and business transfers)/Collective
employment representation

 

9.6 The Company has no obligation to make any payment or provide any benefit on
the redundancy of any Employee in excess of the statutory redundancy payment,
and has not, in the five years preceding Completion, operated any discretionary
practice of making/providing any such excess payments or benefits to any of its
employees. The Company has no obligation to follow any implied or express
redundancy procedure.     9.7 Within the period of two years before Completion,
the Company has not made, or started implementation of, any collective
dismissals that have required or will require notification and/or consultation
with any state authority, trade union, works or supervisory council, staff
association and/or other body representing or in relation to any employees.    
9.8 No individual has transferred to, or from, the Company by operation of the
Transfer Regulations or otherwise in the two years before Completion and no
individual is due to transfer to or from the Company by operation of the
Transfer Regulations or otherwise on Completion or in the six months after
Completion.

 

Disputes/Liabilities/Commitments

 

9.9 The basis of the remuneration and benefits provided to the Employees and
Workers is the same as that in force at the last Accounts Date. There is no
outstanding offer or commitment (whether legally binding or not) to review,
alter and/or improve any terms, conditions, remuneration, benefits or schemes in
relation to any Employee or Worker, including in relation to any bonus or
incentive scheme.     9.10 So far as the Sellers are aware, the Company does not
owe any amount to any Employee or Worker, or former employee or former worker
(or their dependants) other than in respect of remuneration, pension
contributions or reimbursement of business expenses (all of which have accrued
in the normal course of business within the current payment period), and no
Employee or Worker, or former employee or former worker, owes any amount to, or
has any loan with the Company.

 

44

 

 

9.11 So far as the Sellers are aware, there are no current, pending or
anticipated investigations, grievances, conciliation discussions, protected
disclosures, or disciplinary procedures (including any grievance or disciplinary
appeals), or litigation, relating to any Employee or Worker or former employee
or former worker, and there are no circumstances likely to give rise to any such
investigations, grievances, conciliation discussions, protected disclosures,
disciplinary procedures, or litigation.

 

Compliance

 

9.12 The Company has, in relation to each of its Employees and Workers, and its
former employees and former workers, in any applicable jurisdiction, complied in
all material respects with all obligations imposed on it by all contracts,
statutes, directives, orders, regulations, collective agreements, awards, codes
of conduct relevant to their terms and conditions of employment or engagement
and to the relations between it and its Employees and Workers and former
employees and former workers.

 

10 Pensions

 

10.1 Save for the Pension Schemes, there is not in operation as at the date of
this Agreement, and there has not been in operation in the last six years prior
to the date of this Agreement, and no proposal has been announced to enter into
or establish, any agreement, arrangement, custom or practice (whether or not
legally enforceable) for the payment by the Company of, or payment by the
Company of a contribution towards, a pension, allowance, lump sum or other
similar benefit on retirement, death, termination of employment (whether
voluntary or not) or during periods of sickness or disablement (whether during
service or after retirement), for the benefit of a Pensionable Employee or
Pensionable Employee’s dependants.

 

10.2 The Company has duly complied with all applicable legal and administrative
requirements relating to the Pension Schemes.     10.3 No amount due in respect
of the Pension Schemes from the Company is unpaid.     10.4 The Pension Schemes
are Defined Contribution Scheme (and, in particular, not a Defined Benefit
Scheme) and no assurance, promise or guarantee (oral or written) has been made
or given to any individual of any particular level or amount of benefits to be
provided for or in respect of him under the Pension Scheme on retirement, death
or leaving employment.

 

10.5 Material particulars of the Pension Schemes are set out in folder 8 of the
Data Room.

 

11 Trading arrangements

 

Contracts

 

11.1 Other than in respect of the Key Contracts, the Company is not a party to
any contract, arrangement or commitment which:

 

  (a) so far as the Sellers are aware , is of an unusual or abnormal nature
having regard to the usual practice of such Group Company; or         (b) is not
on arm’s length commercial terms in the ordinary and usual course of business;
or         (c) involves any agency, franchise, consortium, partnership, joint
venture or profit sharing arrangement; or

 

45

 

 

  (d) contains covenants limiting or excluding such Group Company’s right to do
business and/or to compete in any area or in any field or with any Person; or  
      (e) involves the repurchase from customers or distributors of products or
any other inventory;         (f) is of a long-term nature (that is to say,
unlikely to have been fully performed, in accordance with its terms, more than
six months after the date on which it was entered into); or         (g) is
dependent on any guarantee, indemnity or security provided by any other Person
(other than another Group Company); or         (h) contains any clawback or
similar provisions pursuant to which a party may be entitled to the return of
fees already paid by the other party under such contract, arrangement or
commitment; or         (i) concerns any indebtedness (including, without
limitation, guarantees) greater than $250,000; or         (j) is with a
governmental entity; or         (k) limits or purports to limit the ability of
any Group Company to compete in any line of business or with any Person or in
any geographic area or during any period of time; or         (l) is incapable of
termination in accordance with its terms by such Group Company on six months’
notice or less and involves or would involve a liability on the part of the
Company more than £500,000.

 

Key Contracts

 

11.2 The Sellers have provided the Buyer with accurate copies of all Key
Contracts together with a description of any instance where the terms of any Key
Contract are varied, related or otherwise are not materially adhered to by the
Company or (so far as the Sellers are aware) by the counter-party to such Key
Contracts.     11.3 The Company is not in breach of any of the Key Contracts
(nor, so far as the Sellers are aware, in material breach of any other contract)
in any material respects nor is any other party to any Key Contract.     11.4 So
far as the Sellers are aware, in each case, none of the Key Contracts is
invalid, nor are there any grounds (and there are no facts or circumstances
likely to provide grounds) for determination, rescission, avoidance or
repudiation of any Key Contract.

 

Standard terms

 

11.5 The Sellers have provided the Buyer with copies of all standard terms of
the Company upon which the Company does business with any customers (including
the Key Customers), suppliers (including the Key Suppliers), distributors or any
other party together with a description of any instance where those terms are
varied, relaxed or otherwise are not adhered to by the Company or (so far as the
Sellers are aware) by the counter-party to such standard terms.

 

Key Suppliers

 

11.6 No Key Supplier has during the last 12 months:

 

  (a) ceased, or materially reduced or changed the terms of its trading with the
Company; or

 

46

 

 

  (b) indicated an intention to cease, or materially reduce or change the terms
of its trading with the Company,

 

nor, so far as the Sellers are aware, is likely to do any of the above within
the next 12 months.

 

11.7 There are no individual suppliers material to the Business other than the
Key Suppliers and there are no agreements or arrangements, practices or customs
which are binding on the Company engaged in by or between the Company and the
Key Suppliers otherwise than as set out in the Disclosure Letter.

 

Key Customers

 

11.8 No Key Customer has during the last 12 months:

 

  (a) ceased, or materially reduced, or changed the terms of its trading with
the Company; or         (b) indicated an intention to cease, or materially
reduce or change the terms of its trading with the Company,

 

nor, so far as the Sellers are aware, is likely to do any of the above within
the next 12 months.

 

11.9 There are no individual customers material to the Business other than the
Key Customers and there are no other agreements or arrangements, practices or
customs which are binding on the Company engaged in by or between the Company
and the Key Customers otherwise than as set out in the Disclosure Letter.

 

Attorneys and agents

 

11.10 The Company has not delegated any powers under a power of attorney which
remains in effect and no Person has authority (express, implied or ostensible)
to enter into any contract or commitment or to do anything on behalf of the
Company (other than any ostensible or implied authorities to directors or
employees to enter into routine contracts in the normal course of their duties).

 

Intra-group contracts

 

11.11 Copies of or, where the terms are not reduced to writing, a description of
the key terms of, all agreements or arrangements between any of the Group
Companies are set out in folder 4.1 of the Data Room.

 

Outsourcing arrangements

 

11.12 There is no current activity or service (including but not limited to
payroll, accounting or other administrative services) being carried on for the
benefit of or provided to the Company by a third party which, in the three years
preceding the date of this Agreement, was carried on by the Company.

 

12 Licences to operate

 

12.1 All material statutory, municipal, governmental, regulatory, court and
other requirements applicable to the formation, continuance in existence,
creation and issue of securities, management, property or operations of the
Company have been obtained and complied with.

 

12.2 All material licences, consents and other permissions and approvals
required for or in connection with the carrying on of the Business (including
nay Licenses-In that require payment of any royalty fee) have been obtained, and
are in full force and effect and all reports, returns and information required
by law or as a condition of any licence, consent, permit or approval to be made
or given to any Person or authority in connection with the Business have been
made or given to the appropriate Person or authority and there are no
circumstances which indicate that any such licence, consent, permission or
approval is likely to or may be revoked.

 

47

 

 

13 Compliance

 

13.1 So far as the Sellers are aware, the Company is not liable for any
criminal, illegal, unlawful, ultra vires or unauthorised act or breach of
covenant or statutory duty and there is no violation of, or default with respect
to, any statute, regulation, order, decree or judgment of any court or central
or local government agency of the United Kingdom or any other country.

 

13.2 The Company has not received notification that any investigation or inquiry
is being or has been conducted by any governmental or other body in respect of
the affairs of the Company and the Sellers are not aware of any circumstances
which would give rise to such investigation or inquiry.

 

13.3 None of the Directors:

 

  (a) have been convicted of any criminal offence or been subject to any
criminal proceedings;         (b) have been subject to any order made under the
Company Directors Disqualification Act 1986;         (c) have been censured by
London Stock Exchange plc, the FSA, the FCA, the PRA, any other recognised
investment exchange (whether privately or publicly) or by any governmental or
quasi-government department, agency or body;         (d) have been declared
bankrupt or entered into a voluntary arrangement with his/her creditors;        
(e) have been subject to any proceedings brought in respect of a breach or
alleged breach of any of the provisions of chapter 2 of Part 10 of the Companies
Act 2006 (Duties of Directors).

 

Embargo Countries

 

13.4 Neither the Company nor any agent or representative of the Company:

 

  (a) engages in trade with or provides services to or trains or advises or
donates money to or in any other way assists or facilitates the activities of
any Embargo Entity;         (b) engages in any activity referred to in paragraph
(a) in relation to any agent or representative for or any subsidiary of any
Embargo Entity, or in relation to any Entity ultimately controlled by an Embargo
Entity;         (c) owns any property or has any legal or beneficial interest in
any Embargo Country or Embargo Entity or any agent or representative for or any
subsidiary of any Embargo Entity or any Entity ultimately controlled by an
Embargo Entity.

 

Anti-corruption

 

13.5 The Company has not at any time engaged in any activity, practice or
conduct which would constitute an offence under the Bribery Act 2010, the
Foreign Corrupt Practices Act 1977 or equivalent legislation in other
jurisdictions in which the Company or a Subsidiary operates.

 

13.6 So far as the Sellers are aware, no associated Person of the Company (as
defined in section 8(1) Bribery Act 2010) has bribed another Person (within the
meaning given in section 7(3) Bribery Act 2010) intending to obtain or retain
business or an advantage in the conduct of business for the Company.

 

48

 

 

13.7 The Company has in place procedures designed to prevent the Company and its
associated Persons from engaging in the conduct referred to in paragraphs 13.5
and 13.6.

 

14 Litigation

 

14.1 The Company is not, and no Person for whose acts and defaults they may be
vicariously liable is, engaged or otherwise involved in any action or proceeding
(whether civil or criminal), arbitration or mediation (whether formal or
informal), investigation or inquiry in any jurisdiction.

 

14.2 Neither the Company nor so far as the Sellers are aware, any Person for
whose acts and defaults the Company may be vicariously liable has received
notice in writing or otherwise of:

 

  (a) any actual, pending or threatened governmental (or quasi-governmental),
regulatory (or quasi-regulatory) investigation or inquiry, whether formal or
otherwise, which is connected with the Company by, any such governmental,
regulatory or similar body or agency in any jurisdiction; or         (b) any
claim in damages connected with the Company (whether liquidated or
unliquidated), or of an injunction or other order or an application for such an
injunction or other order, either as a party or non-party to proceedings,
arbitration, investigation, inquiry or other action, formal or otherwise, which
is connected with the Company in any jurisdiction.

 

14.3 So far as the Sellers are aware, there are no circumstances which are
reasonably likely to lead to any such matter referred to in paragraphs 14.1 and
14.2.

 

14.4 There is no judgment, award, order or decision outstanding or pending
against the Company or its assets.

 

14.5 So far as the Sellers are aware, the Company has not sold any products or
supplied any services which were at the time they were sold or supplied or are,
or will become, faulty or defective or which did not or do not comply with:

 

  (a) any warranties or representations expressly or impliedly made by or on
behalf of the Company in connection with such products or services; or        
(b) any laws, regulations, standards and requirements applicable to such
products or services.

 

14.6 No proceedings have been started, are pending or have been threatened
against the Company:

 

14.7 in which it is claimed that any product sold by the Company is defective,
not appropriate for its intended use or has caused bodily injury or material
damage to any person or property when applied or used as intended; or

 

14.8 in respect of any services supplied by the Company.     14.9 There are no
disputes between the Company and any of their respective customers, clients or
any other third parties in connection with any products or services, sold or
supplied by the Company.

 

15 Insurance

 

15.1 True and accurate copies of the Policies are set out in folder 13of the
Data Room.     15.2 Each of the Policies is valid and enforceable and is not
void or voidable.     15.3 The Company has not done anything or omitted to do
anything which is likely to:

 

49

 

 

  (a) make any of the Policies void or voidable;         (b) entitle the
insurers under any of the Policies to refuse indemnity in whole or in part in
respect of any claims under the Policies; or         (c) prejudice the ability
of the Company to effect insurance on the same or better terms in the future.

 

15.4 No claims have been made, no claim is outstanding and, so far as the
Sellers are aware, no fact or circumstance exists which might give rise to a
claim under any of the Policies, and no event, act or omission has occurred
which requires notification under any of the Policies.     15.5 All premiums
which are due under the Policies have been paid in full and on the due date.    
15.6 The Disclosure Letter contains accurate details of all insurance claims
made by the Company during the period of 24 months ending on the date of this
Agreement.

 

16 Assets

 

16.1 The tangible assets (excluding any Intellectual Property for the avoidance
of doubt) owned or held by the Company, together with assets held under any
leasing, hire, hire-purchase, retention of title, conditional sale or credit
sale agreement, comprise all assets necessary for the continuation of, and which
are used by, the Business as carried on at the date of this Agreement and such
assets are in satisfactory operating condition and repair (subject to usual wear
and tear), and are adequate for the uses to which they are being put.     16.2
All the assets and property used or held by the Company for the purposes of
carrying on the Business are its absolute property and in its possession and
control and none is the subject of any Encumbrance (excepting any lien arising
by operation of law in the ordinary course of trading) or, save as Disclosed in
the Disclosure Letter, the subject of any leasing, hire, hire-purchase,
retention of title, conditional sale or credit sale agreement.     16.3 The
Sellers have provided the Buyer with a copy of the terms upon which the Company
use those assets and property subject to leasing, hire, hire-purchase,
conditional sale or credit sale agreement terms.     16.4 The Company has not
provided any of its assets or property to any third party on lease, hire,
hire-purchase, conditional sale or credit sale agreement terms.     16.5 As far
as the Principal Shareholders are aware, the finished goods inventories of the
Group Companies, when taken as a whole, are in saleable and merchantable
condition and fit for the intended use by the Group Companies customers.

 

17 Intellectual Property

 

Ownership and Licensing

 

17.1 The Company is the sole legal and beneficial owner, or lawful licensee, of
the Business IP.     17.2 All Owned Business IP is valid, enforceable and
subsisting and nothing has been done or omitted to be done which may cause any
of it to cease to be so.     17.3 All Business IP created for the Company has
been created by an employee of the Company acting within the course of his
employment or a third party bound by an agreement vesting ownership in the
Company resulting in ownership of that Business IP vesting in the Company and
which includes a waiver (where such third party is an individual) of any moral
rights regarding such Business IP, to the extent permitted by applicable law.  
  17.4 Material details of all material Owned Business IP are set out in folder
9in the Data Room.

 

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17.5 Accurate and not misleading copies of all Licences-Out and Licences-In
(including any amendments and variations to those agreements) have been provided
by the Sellers to the Buyer, together with a copy of all licences and agreements
relating to Intellectual Property which the Company is in the course of
negotiating.

 

Maintenance of Business IP

 

17.6 All renewal and extension fees, including all fines, penalties and interest
in respect of all registered Owned Business IP have been paid in full on the
date due.     17.7 The Company is in possession of and owns and controls all
documents and materials:

 

  (a) which relate to the right, title and interests of the Company to the
Business IP; and         (b) necessary for the prosecution and maintenance of
all registrations and applications for registration of Owned Business IP and the
Company’s rights in the Licensed Business IP.

 

Dealings and adequacy of rights

 

17.8 None of the Owned Business IP is subject to any Encumbrance.     17.9 Other
than under a Licence-Out, the Company has not authorised or otherwise expressly
or impliedly permitted any use whatsoever of the Business IP.     17.10 The
Owned Business IP and Licensed Business IP together comprise all Intellectual
Property material to and/or reasonably necessary to carry on the Business as
conducted by the Company at the date of Completion and to carry out all existing
obligations and commitments of the Business as at the date of Completion.

 

Infringements

 

17.11 The activities, processes, methods, products, services, web sites,
documents, materials and Intellectual Property used, dealt in or supplied by the
Company on or before the date of Completion do not at the date of Completion,
nor did they at the time, infringe or make unauthorised use of the rights of any
Person.     17.12 No Person or competent authority has made any claim, challenge
or opposition in relation to the Owned Business IP or Confidential Information.
    17.13 So far as the Sellers are aware, there is not, and never has been an
actual, suspected or threatened infringement or unauthorised use by a third
party of any Owned Business IP or Confidential Information.

 

Confidential Information

 

17.14 So far as the Sellers are aware, all Confidential Information is kept
confidential by the Company and the Company has not disclosed any of its
Confidential Information other than:

 

  (a) to its employees and professional advisers, and then only in circumstances
of strict confidentiality; and         (b) in the ordinary course of business
and in the case of a material disclosure, subject to a binding confidentiality
agreement.

 

17.15 The Sellers are not aware of any breach of any obligations of
confidentiality owed by any Person to the Company, including for this purpose by
its employees, consultants, agents or professional advisers.

 

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17.16 The Company is entitled to use all Confidential Information in their
possession and there are no restrictions on its use of such Confidential
Information.

 

Claims

 

17.17 No claims, disputes or proceedings in respect of Business IP have been
settled by the Company in the three years immediately preceding Completion.    
17.18 There are and have been no claims, disputes or proceedings (and none is
pending, threatened or expected) in relation to the Owned Business IP or (so far
as the Sellers are aware) the Licensed Business IP, and, so far as the Sellers
are aware, there are no circumstances which might have an adverse effect on the
Company’s rights in, and use of, the Business IP.

 

18 ICT Infrastructure     18.1 Material details of the ICT Infrastructure are
set out in the Data Room at folder 11.     18.2 The arrangements relating to the
ICT Infrastructure (including its operation and maintenance and any amendments
or modifications to it) will not of itself be adversely affected by the
transaction contemplated under this Agreement and the ICT Infrastructure will
continue to be available for use by the Company immediately following Completion
and thereafter on substantially the same terms and conditions as prevailed
immediately before Completion.     18.3 The Company is the sole legal and
beneficial owners of the ICT Infrastructure and the ICT Infrastructure is used
exclusively by the Company.     18.4 The ICT Infrastructure is:

 

  (a) free from Encumbrances;         (b) so far as the Sellers are aware, in
working order and functions materially in accordance with all applicable
specifications;         (c) maintained and supported in accordance with good
industry practice and is covered by maintenance and warranty provisions to
remedy, or provide compensation for, any material defect;         (d) protected
by appropriate security and disaster recovery arrangements including taking and
storing back-up copies (both on and off site) of the Software and any data in
the ICT Infrastructure and following procedures for preventing the introduction
of viruses to, and unauthorised access of, the ICT Infrastructure.

 

18.5 As far as the Sellers are aware, the Company has not experienced in the
three years preceding Completion any disruption in or to its operations or
business as a result of:

 

  (a) any substantially decreased performance or material defect in any part of
the ICT Infrastructure whether caused by any viruses, bugs, worms, lack of
capacity or otherwise; or         (b) a material breach of security in relation
to any part of the ICT Infrastructure.

 

18.6 Software which is Owned Business IP is not the subject of any source code
escrow arrangement and the source code in such Software has not been disclosed
to, or otherwise become known by, any third party.     18.7 The Software which
is Owned Business IP does not include or incorporate any Publicly Available
Software and the Company has not used or exploited, and have adopted procedures
to avoid the use or exploitation in the Business of, any Publicly Available
Software.

 

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19 Data protection     19.1 In respect of all and any personal Data processed by
the Group, the Company:

 

  (a) has made all necessary registrations in accordance with the Data
Protection Legislation and has listed all registrations in document 10of the
Data Room;         (b) complies in all material respects with the Data
Protection Legislation;         (c) has complied with any subject access
requests made pursuant to the Data Protection Legislation;         (d) has not
received any notice or communication of any kind pursuant to any part of the
Data Protection Legislation; and         (e) has not received any communication
from any Person alleging breach of any Data Protection Legislation or
complaining about the Company’s use of personal Data.

 

19.2 So far as the Sellers are aware, there have not been any incidents of data
security breaches with respect to personal Data stored or held by or (so far as
the Sellers are aware) on behalf of any Group Company and no Person has had
unauthorised or unlawful access of any such personal Data.     19.3 Where
processing of personal Data is based on the consent of a data subject (as that
term is defined in the DPA) (including marketing by electronic means), each data
subject has freely and unambiguously given its specific and informed consent to
all processing of his or her personal Data carried on by or on behalf of any
Group Company.     19.4 No personal Data in respect of which any Group Company
within the European Economic Area is a Controller has been transferred by that
Group Company outside the European Economic Area, other than:

 

  (a) to a recipient located within a country in respect of which the European
Commission has made a positive decision as to whether such country ensures an
adequate level of protection of personal data (known as a “white list” country);
        (b) to a recipient with whom a Group Company has entered into an
agreement incorporating the model clauses approved by the European Commission
under: (i) Decision 2001/497/EC; (ii) Decision 2004/915/EC; or (iii) Decision
2010/87/EU;         (c) to a recipient located in the United States who has
registered as a participant in the EU-US Privacy Shield; or         (d)
otherwise in compliance with the Data Protection Legislation.

 

19.5 The Company has not supplied or provided access to personal Data processed
by it to a third party for remuneration or other consideration.     20 Dealings
over the internet     20.1 The appropriate standard terms and conditions of the
Company from time to time are properly incorporated into any transaction
conducted over the internet by the Company and govern access to and use of any
Company Web Site.     20.2 So far as the Sellers are aware, the contents of any
Company Web Site and all transactions conducted over the internet comply with
all laws and regulations in any applicable jurisdiction.     20.3 The Data Room
contains a correct, current, and complete list of all social media accounts used
by the Company in the conduct of the Business. The Company has complied, in all
material respects, with all terms of use, terms of service, and other Contracts
and all associated policies and guidelines relating to its use of any social
media platforms, sites, or services in the conduct of the Business
(collectively, “Platform Agreements”).

 

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20.4 There are no actions settled, pending, or, so far as Sellers are aware,
threatened alleging (A) any breach or other violation of any Platform Agreement
by the Company; or (B) defamation, any violation of publicity rights of any
Person, or any other violation by the Company in connection with its use of
social media in the conduct of the Business.     21 The Properties

 

Details of the Properties

 

21.1 The information in respect of each Property set out in Schedule 7 is true
and accurate in all material respects.     21.2 No Group Company owns or has any
interest in any land or building other than the Properties, and no Group Company
has entered into any legally binding agreement for the purchase of any such
interest.     21.3 The Group has no historical or continuing liability
whatsoever in respect of any freehold, leasehold or other interest in any
property other than in relation to the Properties.     21.4 The Group has not
had occasion to make any claim or complaint in relation to any neighbouring
property or its use or occupation and there are no disputes, claims, actions,
demands or complaints in respect of any Property which are ongoing nor are any
disputes, claims, actions, demands or complaints anticipated and no notices
materially affecting any Property have been given or received and not complied
with.     21.5 Accurate and not misleading copies of all tenancies pursuant to
which a Property is held or used are Disclosed in the Data Room (the “Leases”).

 

Statutory obligations

 

21.6 No notice of any breach has been received by the Group of any applicable
statutory and by law requirements with respect to each Property, and in
particular with the requirements as to fire safety and fire precautions under
the Regulatory Reform (Fire Safety) Order 2005, asbestos under the Control of
Asbestos Regulations 2006 and general matters under the Public Health Acts, the
Offices, Shops and Railway Premises Act 1963, the Health and Safety at Work Act
1974 and the Factories Act 1961.

 

Leases

 

21.7 The Company has paid the rent without complaint or objection from the
landlord and there is no subsisting material breach, nor any material
non-observance of any covenants, condition or agreement contained in the Leases
on the part of either the landlord or the Group.     21.8 No Group Company has
in the past been the tenant of or guarantor of any leasehold premises not listed
in Schedule 5 in respect of which any obligations or liabilities could still
accrue to the Group.     21.9 No alterations have been made to the Properties at
the expense of any Group Company without all necessary consents and approvals.  
  21.10 No alterations or works have been carried out on the Properties by the
Company during the term of the leases relating to such Properties.

 

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22 Environmental     22.1 The Group Companies have complied in all material
respects with all Environmental Laws.     22.2 No Group Company has, in the last
three years, received any communication in any form from any relevant authority
from which it appears that it may be or is alleged to be in breach of
Environmental Laws, or where failure to comply with such communication could
constitute a breach of Environmental Laws or where compliance with such
communication could be secured by further proceedings by such relevant
authority. So far as the Sellers are aware, there are no circumstances which
might give rise to such a communication being received and the Sellers are not
aware of any intention on the part of any such authority to give such
communication.     22.3 So far as the Sellers are aware, there are no facts or
circumstances which may give rise to any actual or potential liability (whether
civil or criminal) on the part of any Group Company or any of its officers in
relation to Environmental Matters.     22.4 No Group Company has received any
notice or intimation of any complaint or claim from any Person in respect of
Environmental Matters.     22.5 No Group Company is, nor has any Group Company
in the last three years, been engaged in any action, litigation, arbitration or
dispute resolution proceedings or subject to any audit or investigation under
Environmental Laws or otherwise in relation to Environmental Matters and the
Sellers are not aware of any such matters pending or being threatened or of any
circumstances or facts likely to give rise to any such matters.     22.6 No
Group Company has given or received any warranties or indemnities in respect of,
nor has any Group Company otherwise attempted to apportion, liabilities, duties
or obligations relating to Environmental Matters or arising under Environmental
Laws.     23 Health and Safety

 

The Group Companies have complied in all material respects with all Health and
Safety Laws and no Group Company has received any written notice in the last two
years of any alleged breach of Health and Safety Laws which has not been
complied with.

 

24 Bank accounts, borrowings and lending

 

Bank accounts

 

24.1 Full details of all bank accounts maintained by the Company are accurately
set out in folder 3 of the Data Room and the total amount borrowed by the
Company from its bankers does not exceed its agreed overdraft facilities.

 

Borrowings

 

24.2 The total amount borrowed by the Company does not exceed any limitation on
its borrowing powers contained in its Articles of Association, or in any
debenture or other deed or document binding on it.     24.3 The Company does not
have outstanding, nor has agreed to create or issue, any loan capital, nor have
they factored any of their debts, or engaged in financing of a type which would
not require to be shown or reflected in the Accounts, or borrowed any money
which they have not repaid, except for borrowings not exceeding the amounts
shown in the Accounts.

 

Loans

 

24.4 Other than in the ordinary course of business, the Company has not lent any
money which has not been repaid, and the Company does not own the benefit of any
debts (whether or not due for payment), other than debts which have arisen in
the ordinary course of business.

 

55

 

 

Default

 

24.5 The Company has not, by reason of its default, become bound, and no Person
has become entitled (or with the giving of notice and/or the issue of a
certificate will become entitled) to require it, to repay prior to its
stipulated due date any loan capital or other debenture, redeemable preference
share capital or borrowed money and no notice has been received of such
liability having arisen for any other reason.

 

Guarantees and Indemnities

 

24.6 The Company has no liability (whether actual or contingent) under any
guarantee, indemnity or other agreement to secure or incur a financial or other
obligation relating to the failure of another Person (other than the Company) to
perform its obligations.     24.7 No part of the borrowings, or indebtedness in
the nature of borrowings, of the Company is dependent on the guarantee or
indemnity of, or security provided by, another Person (other than another of the
Companies). No contract or arrangement to which the Company is party is
dependent on the guarantee or indemnity of, or security provided by, another
Person (other than another of the Companies).     25 Grants and allowances    
25.1 Accurate and not misleading details of all investment grants received by
the Company and all other grants or loans received from any governmental
department or agency or any local or other authority by virtue of any statute
are set out in the Disclosure Letter.     25.2 No act, transaction or omission
has occurred which will or may cause, and the purchase by the Buyer of the
Shares will not cause, the Company to be held liable to refund in whole or in
part any investment grant or any other grant or loan referred to in paragraph
25.1, or for any such grant or loan for which application has been made not to
be paid to the Company or to be reduced.     26 Insolvency     26.1 The Company:

 

  (a) is not insolvent or unable to pay its debts within the meaning of the
insolvency legislation applicable to the Company concerned; and         (b) has
not stopped paying its debts as they fall due.

 

26.2 No step has been taken in any jurisdiction to initiate any process by or
under which:

 

  (a) the ability of the creditors of the Company to take any action to enforce
their debts is suspended, restricted or prevented;         (b) some or all of
the creditors of the Company accept, by agreement or in pursuance of a court
order, an amount less than the sums owing to them in satisfaction of those sums
with a view to preventing the dissolution of the Company;         (c) a Person
is appointed to manage the affairs, business and assets of the Company on behalf
of its creditors; or         (d) the holder of a charge over all or any of the
assets of the Company is appointed to control the business and/or all or any
assets of the Company.

 

26.3 No process has been instituted which could lead to the Company being
dissolved and its assets being distributed among its creditors, shareholders or
other contributors.

 

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27 Competition, anti-trust and cartels     27.1 The Company has not done
anything and are not a party to any agreement, arrangement, concerted practice
or course of conduct which contravenes or is likely to or may contravene, or
which required or requires notification or which is, or is likely to be or has
been the subject of any enquiry, complaint, investigation or proceeding under
any of the provisions of the Enterprise Act 2002, Fair Trading Act 1973, the
Treaty on the Functioning of the European Union, the Competition Act 1980, the
Competition Act 1998, EU Regulation 4064/89 or EU Regulation 139/2004 or any
other competition, anti-trust, consumer protection, anti-monopoly, anti-cartel,
state aid control, merger or specific sectoral legislation or regulation in any
country of the world in which or with which it does business. Nor is the Company
a member or party to any agreement or arrangement which required registration
under the Restrictive Trade Practices Acts 1976 and 1977.     27.2 So far as the
Sellers are aware, no officer or employee of the Company is or has been a party
to any agreement, arrangement or course of action which may constitute an
offence under the Enterprise Act 2002 or may lead to disqualification under the
competition provisions of the Company Directors Disqualification Act 1986.    
28 Financial services

 

The Company does not carry on nor has it carried on at any time any regulated
activity in any country in relation to which it is or was required to apply to
be authorised or licenced by the relevant financial services competent authority
under the local implementation of the Markets in Financial Instruments Directive
(Directive 2004/39/EC) or otherwise.

 

29 Share Schemes     29.1 There are no options to acquire shares in any Group
Company granted under Schedule 5 (Enterprise management incentives) to ITEPA
2003 (“EMI Options”) and there are no agreements, schemes or promises to grant
any such EMI Options, other than the Options.     29.2 At the date of grant of
each Option purported to be granted as an EMI Option: (i) the relevant Group
Company met the requirements of Part 3 of Schedule 5 to ITEPA 2003 and (ii) the
relevant Option Seller met the requirements of Part 4 of that schedule.     29.3
The grant of the Options were notified to the relevant Tax Authority pursuant
to, and in accordance with, the requirements of paragraph 44 of Schedule 5 to
ITEPA 2003.     29.4 There have been no disqualifying events in respect of the
Options under section 534 of ITEPA 2003 (“Disqualifying Events”) or material
amendments to any of the terms of any of the Options and no Group Company is
aware of any circumstances (other than Completion itself) which are likely to
cause any such Disqualifying Event to occur.     29.5 Each Option was granted
with an exercise price equal to or greater than the fair market value of the
underlying Option Shares on the date of grant.     29.6 No employment related
securities (as defined in sections 420 and 421B(8) of ITEPA 2003), including,
without limitation, any shares acquired under section 205A of the Employment
Rights Act 1996, have been issued or transferred (other than under any EMI
Option):

 

  (a) by any Group Company; or         (b) under any arrangements established by
any Group Company,

 

and there are no agreements, schemes or promises to make any such issues or
transfers.

 

29.7 No securities options (as defined in section 420(8) of ITEPA 2003) (other
than EMI Options) have been granted:

 

  (a) by any Group Company; or

 

57

 

 

  (b) under any arrangements established by any Group Company,

 

to any current, former or proposed employees or directors of any Group Company
(or to nominees or associates of such individuals) and there are no agreements,
schemes or promises to make any such grant.

 

29.8 For any restricted securities (as defined in section 423 of ITEPA 2003)
acquired by any current, former or proposed employees or directors of any Group
Company (or any nominees or associates of such individuals):

 

  (a) a joint election to disapply fully Chapter 2 of Part 7 of ITEPA 2003 has
been made under section 431(1) of ITEPA 2003; and         (b) all such joint
elections have been properly made using forms approved by the relevant Tax
Authority and within the applicable time limits.

 

29.9 There are no employee benefit trusts, family benefit trusts, or similar
arrangements established by any Group Company, under which any current or former
employees or directors of any Group Company may benefit in any form.     30 Tax
    30.1 All Taxation (whether of the UK or elsewhere) for which any Group
Company has been liable during the last six years has, in all material respects
been duly paid (insofar as such Taxation ought to have been paid) and no
material penalties, fines, surcharges or interest have been incurred by any
Group Company during the last six years.     30.2 All notices, returns
(including any land transaction returns), reports, accounts, computations,
statements, assessments, claims, disclaimers, elections and registrations and
any other necessary information which have or should have been submitted by each
Group Company to any Tax Authority for Tax purposes in the last six years have
been made on a proper basis, were submitted within applicable time limits and
were complete and accurate in all material respects. None of the above is, or,
so far as the Sellers are aware, is likely to become the subject of any material
dispute with any Tax Authority.     30.3 Each Group Company has, in all material
respects, kept and maintained complete and accurate records, invoices and other
information in relation to Tax, that meet all legal requirements and enable the
Tax liabilities of the Group Company concerned to be calculated accurately in
all material respects.     30.4 All Taxation and National Insurance
Contributions deductible by the Company under the PAYE system, the Construction
Industry Scheme or any other Taxation law have, so far as required to be
deducted by the Company, been deducted from all payments made (or treated as
made) by the Company. All amounts due to be paid by the Company to the relevant
Tax Authority under the PAYE system on or before the date of this Agreement have
been so paid.     30.5 No payments or loans have been made to, no assets have
been made available or transferred to, and no assets have been ear-marked,
however informally, for the benefit of, any employee or former employee (or
anyone linked with such employee or former employee) of the Company by an
employee benefit trust or another third party falling within the provisions of
Part 7A of the Income Tax (Earnings and Pensions) Act 2003.     30.6 The
Accounts make proper provision or reserve in accordance with generally accepted
accounting principles for all Taxation for which any Group Company is
accountable at the Accounts Date. Proper provision has been made and shown in
the Accounts for deferred taxation in accordance with generally accepted
accounting principles.     30.7 No Tax chargeable on any Group Company or
subject to withholding or deduction by any Group Company during any accounting
period ending on or within the last six years has to any extent depended on any
unpublished understanding, concession, agreement, arrangement or dispensation
with any Tax Authority.

 

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30.8 No Group Company has been party to, or otherwise been involved with, any
transaction, scheme or arrangement designed wholly or mainly or containing steps
or stages having no commercial purpose and designed wholly or mainly for the
purpose of avoiding or deferring Taxation or reducing a liability to Taxation or
amounts to be accounted for under PAYE.     30.9 So far as the Sellers are
aware, no Group Company is, nor will any Group Company become, as a result of
circumstances applying on or prior to Completion, liable to make to any person
(including any Tax Authority) any payment in respect of any liability to
Taxation which is primarily or directly chargeable against, or attributable to,
any other person (other than a Group Company).     30.10 Each Group Company is
and has throughout the past seven (7) years been resident for Tax purposes
solely in the jurisdiction in which it was incorporated as stated in Schedule 2
and, so far as the Sellers are aware, no Group Company has, at any time in the
past seven (7) years, been treated as resident in any other jurisdiction for the
purposes of any double taxation arrangements or for any other Taxation purpose
nor has or has had a permanent establishment in any other jurisdiction.    
30.11 The Company does not hold, nor within the last seven (7) years has held,
shares in a company, other than any other Group Company, which is not resident
in the UK or a material interest in an offshore fund.     30.12 All transactions
or arrangements made by any Group Company have been made on arm’s length terms
and the processes by which prices and terms have been arrived at have, in each
case, been fully documented. No notice, enquiry or adjustment has been, or is
likely to be, made by any Tax Authority in connection with any such transactions
or arrangements .     30.13 The Company is a taxable person for the purposes of
VATA and is registered for VAT with quarterly prescribed accounting periods.    
30.14 The Company has not, in the period of six (6) years ending with the date
of Completion, been a member of a group of companies for the purposes of section
43 of VATA.     30.15 All supplies made by the Company are taxable supplies for
VAT purposes. The Company will not be denied full credit for all input tax paid
or suffered by it on or before Completion.     30.16 The Company does not own
any assets which are capital assets subject to the capital goods scheme under
Part XV of the VAT Regulations 1995, nor has the Company ever exercised any
option to tax under Part I of Schedule 10 to the VATA.     30.17 No Group
Company has not at any time in the last 7 years made any loan or advance or
payment or given any consideration (other than the payment of a dividend) to any
shareholder, which has not been repaid in full.     30.18 The book value shown
in, or adopted for the purposes of, the Accounts as the value of each of the
tangible fixed assets of each Group Company does not exceed the amount which on
a disposal of such asset at the date of this Agreement would be deductible as
acquisition cost in computing the capital gain or deductible loss.     30.19 The
Company has no capital losses available for carry-forward other than as
disclosed in its corporation tax returns.     30.20 Other than as shown in its
corporation tax returns, the Company has not within the last six (6) years
claimed first-year tax credits within the meaning of Schedule A1 of the CAA
2001, business renovation allowances under Part 3A of CAA 2001, flat conversion
allowances under Part 4A of CAA 2001, or owned at the Accounts Date any asset
which, if disposed of at the date of this Agreement for consideration equal to
its net book value as included in the Accounts would give rise to a balancing
adjustment or clawback of allowances for the purposes of CAA 2001.

 

59

 

 

30.21 No distribution or deemed distribution, within the meaning of section 1000
or sections 1022-1027 of CTA 2010 has been made in the six years prior to the
Accounts Date (or will be deemed to have been made at any time during the six
years prior to the Accounts Date) by the Company, except dividends shown in its
statutory accounts, and the Company is not bound to make any such distribution.
    30.22 The Company has not, within the period of seven (7) years preceding
the date of this Agreement, been engaged in, nor been a party to, any of the
transactions set out in Chapter 5 of Part 23 of CTA 2010 (demergers).     30.23
All financing costs, including interest, discount and premiums, payable by the
Company prior to Completion in respect of its loan relationships within the
meaning of section 302 of CTA 2009 are eligible to be brought into account by
the Company as a debit for the purposes of Part 5 of CTA 2009 at the time, and
to the extent that, such debits are recognised in the statutory accounts of the
Company, other than to extent shown in the corporation tax returns of the
Company.     30.24 The tax returns and computations of each Group Company
included in the Data Room include relevant details of the amount of expenditure
on each of the intangible fixed assets (including goodwill and intellectual
property) of any Group Company.     30.25 The Company does not hold nor has held
any right to which Part 8A of CTA 2010 applies or an exclusive licence in
respect of such right within section 357BA of CTA 2010.     30.26 No asset owned
by the Company, nor the Shares, is subject to any Inland Revenue charge as
mentioned in section 237 and 238 of IHTA 1984 or is liable to be subject to any
sale, mortgage or charge by virtue of section 212(1) of IHTA 1984.     30.27 Any
document that may be necessary or desirable in proving the title of the Company
to any asset which is owned by the Company at the date of this Agreement is duly
stamped for stamp duty purposes. No such documents which are outside the UK
would attract stamp duty if they were brought into the UK.     30.28 Neither
entering into this Agreement nor Completion will result in the withdrawal of a
stamp duty or stamp duty land tax relief granted on or before Completion which
will affect the Company.     30.29 The Disclosure Letter sets out full and
accurate details of any chargeable interest (as defined under section 48 of the
Finance Act 2003) acquired or held by the Company before the date of this
Agreement in respect of which the Sellers are aware, or ought reasonably to be
aware, that an additional land transaction return will be required to be filed
with a Tax Authority and/or a payment of stamp duty land tax made on or after
the date of this Agreement.

 

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Schedule 5

 

Limitations on Liability

 

1 Agreement to Reimburse for Losses: Subject at all times to the limitations set
forth in this Schedule 5, the Buyer’s losses for any breach of Warranty (other
than in the event of fraud or for breach of the Fundamental Warranties) shall be
calculated on the usual contractual basis of damages for breach of contract,
i.e. that damages for loss of bargain should be assessed by reference to the
difference between the value of the shares “as warranted” (i.e. on the basis
that the warranties were true) and the value of the shares “as is” (i.e. given
the actual state of affairs).     2 Cap on liability     2.1 The aggregate
liability of any Seller in respect of all and any Claims under this Agreement
other than as a result of breach of Section 7 (Restrictive Covenants), a
Fundamental Warranty or fraud, dishonesty or wilful concealment of such Seller
or his or her agents or advisors at the request of the Sellers, shall not
exceed:

 

  (a) in the case of each Option Seller, the amount of 75% of the Cash
Consideration received by that Option Seller less the Option Exercise Tax;      
  (b) in the case of each of Kevin Batley and Sheila Batley an amount equal to
76.92% of the aggregate amount of Cash Consideration received by these Persons,
provided that the aggregate liability of both such Persons taken together shall
not exceed such aggregate amount; and         (c) in the case of each of Nigel
Batley and Annette Batley an amount equal to 76.92% of the aggregate amount of
Cash Consideration received by these Persons, provided that the aggregate
liability of both such Persons taken together shall not exceed such aggregate
amount,

 

2.2 Each Option Holder’s liability for a Claim shall not exceed 2% of the value
of that Claim or Breach of Warranty Claim.     2.3 There shall be no limit or
cap on liability in the event of a breach of a Fundamental Warranty or as a
result of fraud, dishonesty or wilful concealment of such Seller or his or her
agents or advisors,     3 Time limits for making Claims     3.1 No Claim may be
made against the Sellers unless a Notice of Claim which is:

 

  (a) a claim for breach of Warranty 8.3 or 8.4 is served on the Sellers on or
before the date falling six months following Completion;         (b) a Business
Warranty Claim (other than a claim for breach of Warranty 8.3 or 8.4) is served
on the relevant Sellers of the Business Warranty Claim on or before the second
anniversary of Completion;         (c) a Tax Warranty Claim is served on the
relevant Sellers of the Tax Warranty Claim on or before the seventh anniversary
of Completion;         (d) for avoidance of doubt, there shall no time limit on
a Claim for a breach of any Fundamental Warranty or as a result of fraud,
dishonesty or wilful concealment of such Seller or his or her agents or
advisors. The Sellers shall not plead the Limitation Act 1980 in respect of any
claims made under the Tax Warranties or Tax Covenant.

 

3.2 Any Claim notified in accordance with paragraph 3.1 shall (if not previously
satisfied, settled or withdrawn) be deemed to have been irrevocably withdrawn 12
months after the date on which notice of the relevant Claim was given (and no
new Claim may be made in respect of the same facts) unless on or before that
date, legal proceedings have been issued and served on the Sellers in respect of
the relevant Claim.

 

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4 Threshold and de minimis

 

4.1 The Sellers shall not be liable in respect of any Warranty Claim unless the
individual Warranty Claim or the aggregate liability for all Warranty Claims
exceeds £400,000.00 (four hundred thousand pounds) in which case the Sellers
shall be liable for the entire amount and not merely the excess.

 

4.2 In calculating liability for Warranty Claims for the purposes of paragraph
4.1 above, any Warranty Claim which is less than £40,000 shall be disregarded.

 

4.3 For the purposes of the limits set out in this paragraph 4 a number of
Warranty Claims arising out of the same or similar subject matter, facts, events
or circumstances shall be aggregated and form a single Warranty Claim.

 

4.4 There shall be no threshold or de minimis in the event of a breach of breach
of Section 7 (Restrictive Covenants), breach of a Fundamental Warranty or as a
result of fraud, dishonesty, or wilful concealment of such Seller or his or her
agents or advisors at the request of the Seller.

 

5 Contingent Claims

 

If any Breach of Warranty Claim is based upon a liability which is contingent
only, the Sellers shall not be liable to make payment unless and until such
contingent liability gives rise to an obligation to make a payment. This is
without prejudice to the right of the Buyer to give notice of the Breach of
Warranty Claim and to issue and serve proceedings in respect of it whilst it
remains contingent. For the avoidance of doubt, the fact that the liability may
not have become an actual liability by the relevant date provided in paragraph 3
shall not exonerate the Sellers in respect of any Warranty Claim properly
notified before that date.

 

6 Right to remedy

 

The Sellers shall not be liable for any Warranty Claim if the alleged breach
which is the subject of the Warranty Claim is capable of remedy and is remedied
to the satisfaction of the Buyer by the Sellers within 30 days of the date on
which the notice in paragraph 3 above is received by the Sellers without any
further loss or detriment to any member of the Buyer’s Group.

 

7 Provisions, changes in legislation

 

7.1 The Sellers shall not be liable for any Warranty Claim (other than a Tax
Warranty Claim, in respect of which the provisions of Part 3 of the Tax Covenant
shall apply instead) to the extent that the subject of the Warranty Claim is
provided for or reserved in the Accounts or Management Accounts or to the extent
such matter was specifically referred to in the notes to the Accounts or
Management Accounts.

 

7.2 The Sellers shall not be liable for any Warranty Claim (other than a Tax
Warranty Claim, in respect of which the provisions of Part 3 of the Tax Covenant
shall apply instead) to the extent that the Warranty Claim arises:

 

  (a) as a result of the passing of, or a change in, a law, rule, regulation or
published practice of a government, governmental department, agency or
regulatory body in any case announced after the date of Completion and having
retrospective effect;

 

  (b) as a result of any increase in rates of Taxation announced since the date
of Completion; or

 

  (c) as a result of any liability or other matter to the extent that it occurs
or is increased as a result of any change in the accounting bases, policies,
practices or methods applied in preparing any accounts or valuing any assets or
liabilities of the Company or any of the Subsidiaries introduced or having
effect after Completion (other than to the extent necessary to comply with the
law or the Accounts Standards applying and in force on or prior to Completion).

 

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  (d) wholly or partly from an act or omission of the Buyer or any Group Company
occurring after Completion other than an act or omission:

 

  (i) required by law; or

 

  (ii) carried out pursuant to an obligation of any Group Company entered into
prior to Completion, as Disclosed; or

 

  (iii) carried out in the ordinary course of business of the Buyer or any Group
Company as carried on at Completion; or

 

  (iv) carried out pursuant to the request or with the written consent or
approval of the Sellers, in circumstances where the Sellers knew the
consequences thereof.

 

8 Recovery from another Person

 

Prior recovery

 

8.1 If the Buyer or any Group Company recovers (whether by payment, discount,
credit, relief or otherwise) from a third party an amount in respect of the same
loss which is the subject matter of a Business Warranty Claim, any actual
recovery (less any reasonable costs incurred in obtaining such recovery and less
any Taxation attributable to the recovery) shall to that extent reduce or
satisfy, as the case may be, such Business Warranty Claim, the Buyer being under
an obligation to use commercially reasonable efforts to make a recovery where
there is a reasonable chance of the relevant Group Company will actually be able
to recover from a third party.

 

Subsequent recovery

 

8.2 If the Sellers pay an amount in respect of a Business Warranty Claim and the
Buyer or any Group Company subsequently recovers (whether by payment, discount,
credit, relief or otherwise) from a third party an amount in respect of the same
loss which is the subject matter of the Business Warranty Claim, the Buyer shall
procure that the relevant Group Company shall pay to the Sellers an amount equal
to the lesser of:

 

  (a) the amount recovered from the third party less any reasonable costs and
expenses incurred in obtaining such recovery and less any Taxation attributable
to the recovery; and

 

  (b) the amount previously paid by the Sellers to the Buyer.

 

9 Third party claims

 

9.1 The Buyer shall:

 

  (a) promptly notify the Sellers’ Representative in writing if the Buyer
becomes actually aware of any claim or potential claim from a third party which
the Buyer is actually aware might result in the Buyer bringing a Business
Warranty Claim against the Sellers (in this Schedule, a “Third Party Claim”);

 

  (b) keep the Sellers’ Representative informed of the progress of any Third
Party Claim and provide the Sellers’ Representative with such information and
documents as they may reasonably request in respect of the Third Party Claim;

 

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  (c) give (and cause each member of the Buyer’s Group to give) the Sellers and
their professional advisers access at reasonable times (and on reasonable prior
notice) to its premises and personnel, and to any relevant assets, accounts,
documents or records within its control, for the purposes of enabling the
Sellers to assess the Third Party Claim and to exercise their rights under this
paragraph 9; and

 

  (d) take such steps or proceedings as the Sellers may reasonably request in
order to avoid, dispute, resist, mitigate, compromise, defend or appeal against
any relevant Third Party Claim; provided, that such steps or proceedings
requested by Sellers shall not be to the material detriment of Buyer or the
Group Companies or result in an increase in any such Third Party Claim; and

 

  (e) take such steps or proceedings as the Sellers may reasonably require in
order to enforce any third party recovery right (that is to say any right to
which the Buyer or the Company or a Subsidiary is or becomes entitled (whether
by way of payment, discount, credit, set off, counterclaim or otherwise) to
recover from any third party (excluding the Buyer, the Company and the
Subsidiaries) any sum in respect of any loss, damage or liability which is or
may be the subject of a Business Warranty Claim.

 

9.2 The Buyer shall act in accordance with any such reasonable requests of the
Sellers given pursuant to clause 9.1 subject to the Buyer and relevant member of
the Buyer’s Group being effectively indemnified and kept indemnified by the
Sellers to the reasonable satisfaction of the Buyer against all Losses incurred
in connection with the taking of such steps or proceedings and provided that the
Buyer shall not be required to take or procure that the Company or any member of
the Buyer’s Group shall take any steps or proceedings that may in the reasonable
opinion of the Buyer cause any damage to any material trading relationship or
goodwill of, the Buyer or the Company or any of the Subsidiaries.

 

10 Offset Insurance

 

9.1 The Buyer shall have the right to offset any amount which either the Sellers
agree in writing is due and owing to the Buyer, or which a court of competent
jurisdiction finally determines is due and owing from the Sellers to the Buyer
and no right of appeal lies (Resolved Claim), against any amount otherwise
payable to such Seller pursuant to this Agreement, or otherwise prior to seeking
payment directly from such Seller, including without limitation, equitably
reducing the number of shares of Series B Preferred Consideration Shares or
Series C Preferred Consideration Shares held by such Seller based (a) on the
dollar value of the Claim relative to the USD$10.00 per share stated value or
liquidation price of shares of Series B Preferred Consideration Shares or Series
C Preferred Consideration Shares held by such Seller or (b) if the Series B
Preferred Consideration Shares or Series C Preferred Consideration Shares have
been previously converted into shares of Class A Common Stock, the volume
weighted average closing price of the Buyer’s Class A Common Stock as traded on
Nasdaq for the twenty (20) trading days immediately prior to the date of the
Resolved Claim..

 

9.2 The Sellers shall not be liable in respect of a Business Warranty Claim or
Tax Warranty Claim where the Buyer, the Company or any of the Subsidiaries is
entitled to make a claim under a policy of insurance in respect of any matter or
circumstance giving rise to the Business Warranty Claim, Tax Claim unless the
Buyer first makes (or procures that the Company or the relevant Subsidiary
makes) a claim against its insurers pursuant to the relevant policy; provided
however neither Buyer nor the Company nor relevant Subsidiary shall be required
to take any further action if such claim is denied, in whole or in part, by the
insurer. The Sellers’ liability in respect of any such Business Warranty Claim,
Tax Claim shall then be reduced by the amount recovered under such policy of
insurance (less all reasonable costs, charges and expenses incurred by the Buyer
or member of the Buyer’s Group in recovering that sum), or extinguished if the
amount so recovered exceeds the amount of the Business Warranty Claim, Tax
Claim.

 

11 No double recovery

 

The Buyer shall not be entitled to recover from the Sellers more than once for
the same damage suffered, and in particular the Sellers shall not be liable for
any Warranty Claim to the extent that payment has been made in respect of the
liability giving rise to such Warranty Claim under the Tax Covenant.

 

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12 Tax

 

To the extent of any inconsistency between this Schedule 5 and the Tax Covenant
at Schedule 8, the provisions of the Tax Covenant shall apply to Tax Covenant
Claims in priority to the provisions of this Schedule 5. The provisions of Part
3 of Schedule 8 shall apply in respect of Tax Warranty Claims.

 

13 Mitigation

 

Nothing contained in this Agreement shall have the effect of relieving the Buyer
from any common law duty to mitigate any loss or damage suffered by it as a
result of a breach of the Business Warranties.

 

14 Assignees

 

Any third party which is entitled under the terms of this Agreement to make any
claim against the Sellers or any of them shall be subject to the provisions of
this Schedule as if it were the Buyer.

 

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Schedule 6

 

Part 1: Key Customers

 

Tierney Brothers Inc

Speechi - Wouarf

Information & Data Networks Supplies Ltd

Charmex Internacional S.A.

Aesthetix Technologies LLC

Roche Audio Visual Limited

UNIT.DK

Data Projections, Inc.

Proactive Learning Ltd

AV Parts Master Ltd

EET Europarts Oy

J. Klausner Professional Multimedia Gmbh

Interactive Concepts BVBA

CDEC Limited

Kindermann GmbH

The Saville Group Ltd

AVM Impact Ltd

AV Syd AB

NIAVAC

Thomsun Trading International Ltd

 

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Part 2: Key Suppliers

 

Wah Lee

Epson (UK) Ltd

BenQ UK Ltd

Europa Worldwide Logistics Ltd P001*

Very PC Limited

NEC Display Solutions Europe GmbH

Natural User Interface Technologies AB *GBP*

CONEN Produkte GmbH & Co. KG

Europa Worldwide Logistics Ltd SAHPREDFD*

Shiyuan (HK) Limited

 

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Schedule 7

 

Leasehold Property

 

Lessee  

Date of Lease

  Parties   Term   Short Description

Sahara Presentation Systems Plc

  15 July 2019  

(1) Bridges Business Space LLP and (2) Sahara Presentation Systems Plc.

  1 June 2019 to 31 May 2020   Office 10, Flexspace Business Centre, 1
Michaelson Square, Garbett Road, Livingtson, EH54 7DP

Sahara Presentation Systems Plc

  1 February 2019  

(1) Europa Warehouse Ltd and (2) Sahara Presentation Systems Plc.

  1 February 2019 to 31 January 2024.   Europa Warehouse Dartford

Sahara Presentation Systems Plc

  7 March 2019    (1) The Office Group and (2) Sahara Presentation Systems Plc.
  1 July 2019 to 30 June 2020  

Innovation Centre, One Aire Street, Leeds, LS1 4PR

Sahara Presentation Systems Plc

  29 January 2018  

(1) Robinsons Cruisers Limited and (2) Sahara Presentation Systems Plc.

  29 January 2018 to 28 January 2019   Offices at Shepley Bridge Marina,
Mirfield

Sahara Presentation Systems Plc

  10 September 2020   (1)Barts Close Office Limited and (2) Sahara Presentation
Systems Plc.   1 December 2020 to 30 November 2025   55 Bartholomew Crescent
London EC1 Sahara Nordic AB   1 February 2016   (1) Stiftelsen Forum and (2)
Sahara Nordic AB.   Rolling 3 month contract from 1 February 2016   C/O
Oscarshamns Business Centre, Södra Långgatan 15 – 17, 572 33 OSKARSHAMN, KALMAR
Sahara Nordic AB   1 June 2014   (1) QO Kontorshotell i Hammarby AB and (2)
Sahara Nordic AB.   Rolling 3 month contract from 1 June 2014   311, Hammarby
Fabriksvag 23, Stockholm, Sweden Sahara Nordic AB   1 September 2014  
(1)Kopings Kommun and (2) Sahara Nordic AB.   Rolling 3 month contract from 1
September 2014   Glasgatan 20A, Lokal Index, Kontorskal, Sweden Sahara Nordic OY
  1 November 2011  

(1) Asuntosaation Isannointi Oy and (2) Sahara Nordin Oy

  Rolling 3 month contract from 1 November 2011   Laivalahden Puistotie 10,
00810 Helsinki Sahara Presentation Systems Gmbh   1 June 2020   (1)Regus and (2)
Sahara Presentation Systems GmbH   1 June 2020 to 31 May 2021   3rd Floor
Johannstr. 37 40476 Düsseldorf Sahara Presentation Systems inc   9 March 2020  
(1)Regus and (2) Sahara Presentation Systems inc   9 March 2020 to 30 September
2020   Suite 150W, 9600 Great Hills Trail Austin, Texas, 78759, USA Clevertouch
B.V.   23 October 2019   (1)Allround Investment B.V. and (2)   23 October 2019
to 23 October 2021   Office Room 13, The Mixer, Landdrostlaan 51 te Apeldoorn
Clevertouch B.V.   No written agreement   (1) Rhenus Logistics and (2)
Clevertouch B.V.   No written agreement   Rhenus Logistics, PO Box 693, 5900 AR
Venlo

 

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Schedule 8

 

Taxation

 

Part 1: Definitions and interpretations

 

1 DEFINITIONS AND INTERPRETATION

 

1.1 In this Agreement, unless the context otherwise requires, the following
words have the following meanings:

 

“Accounts Relief” means any Relief which:

 

  (a) has been shown as an asset in the Accounts; or

 

  (b) has been taken into account in computing (and so reducing or eliminating)
any provision for deferred Taxation which appears or which but for the
availability or presumed availability of the Relief would have appeared in the
Accounts.

 

“Buyer’s Tax Group” means the Buyer and any other company or companies which
either are or become after Completion, or have within the seven years ending on
Completion, been treated as members of the same Tax Group as the Buyer for any
Tax purpose.

 

“Buyer’s Relief” means:

 

  (a) an Accounts Relief; and/or

 

  (b) any Relief which arises in respect of any period after the Accounts Date
or any Relief which arises in respect of any Event effected on or after Accounts
Date; and/or

 

  (c) any Relief which arises at any time to the Buyer or a member of the
Buyer’s Tax Group (other than a Group Company before Completion).

 

“Claim for Taxation” means any notice, demand, assessment, letter or other
document issued or action taken by or on behalf of any Tax Authority indicating
that any Person is or may be placed or sought to be placed under a Liability to
Taxation.

 

“Deemed Liability to Taxation” means a Liability to Taxation that falls within
limbs (b) and (c) of that definition.

 

“Event” means, without limitation, any act, event, transaction or omission
whatsoever and includes the expiry of a period of time, any Group Company
becoming or ceasing to be associated with any other Person for any Tax purpose
or ceasing to be, or becoming, resident in any country for any Tax purpose, the
death, winding up or dissolution of any Person, the earning, receipt or accrual
for any Tax purpose of any income, profit or gains, the incurring of any loss or
expenditure, and the execution and completion of this Agreement, and any
reference to an Event occurring on or before a particular date shall include
Events that, for Tax purposes, are deemed to have, or are treated or regarded as
having, occurred on or before that date.

 

“Group Relief” means any Relief available between members of a Tax Group.

 

“Indirect Tax” means VAT or any value added, turnover, sales, use, distribution
or corresponding or similar Tax.

 

“Liability to Taxation” means:

 

  (a) any liability of a Group Company to make an actual payment or increased
payment of, or in respect of, or on account of Taxation whether or not the same
is primarily payable by any Group Company and whether or not the relevant Group
Company has, or may have, any right of reimbursement against any other Person;

 

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  (b) the Loss, otherwise than by the use or setting off, of any Accounts
Relief;

 

  (c) the utilisation, including the setting off against any Liability to
Taxation or against Profits, of any Buyer’s Relief in circumstances where, but
for the utilisation, the relevant Group Company would have had a Liability to
Taxation falling within paragraph (a) of this definition.

 

“Loss” includes absence, failure to obtain, non-existence, non-availability,
reduction, modification, loss, counteraction, nullification, disallowance,
withdrawal or clawback for whatever reason.

 

“PAYE” means any system for the deduction and withholding of Tax or national
insurance contributions or social security contributions (or similar or
corresponding obligations) or both from sums paid to employees in respect of
their employment.

 

“Profits” means income, profits and gains and references to “Profits earned,
accrued or received” include Profits deemed to have been earned, accrued or
received for Taxation purposes.

 

“Relief” means any relief, loss, allowance, exemption, deduction or credit in
computing or against Profits or Taxation or any right to repayment of Taxation
and references to the “loss of any Accounts Relief” means the total or partial
loss, non-availability, reduction, counteraction, utilisation or disallowance,
and “lose” and “lost” shall be construed accordingly.

 

“Taxation” and “Tax” means all forms of tax and statutory, governmental, state,
federal, provincial, local, government or municipal charges, duties, imposts,
contributions, levies, withholdings or liabilities wherever chargeable and
whether of the United Kingdom or any other jurisdiction (including, for the
avoidance of doubt, National Insurance contributions in the United Kingdom and
corresponding obligations elsewhere) (but excluding the uniform business rate
and council tax and their equivalent in any other jurisdiction) and any penalty,
fine, surcharge, interest, charges or costs relating to it (including interest
and penalties arising from the failure of the Company to make adequate
instalment payments in any period ending on or before Completion) and in each
case whether payable directly or indirectly and in respect of any Group Company
whether their liability for the same is a primary or secondary liability.

 

“Tax Authority” means any taxing or other authority, body or official competent
to administer, determine, impose or collect any Taxation.

 

“Tax Counsel” means a practising barrister in England and Wales of at least 10
years’ call, experienced in United Kingdom tax matters, or, in relation to any
matter involving Taxation imposed in a jurisdiction other than the United
Kingdom, an equivalently qualified and experienced Person in such other
jurisdiction.

 

“Tax Group” means those companies treated for the purposes of determining the
amount of or liability for or relief from any Tax as being members of the same
group of companies or fiscal unity.

 

“Tax Statute” means any directive, statute, enactment, law or regulation
wherever enacted or issued, coming into force or entered into providing for or
imposing any Tax, or providing for the reporting, collection, assessment or
administration of any Tax liability, and shall include orders, regulations,
instruments, bye-laws or other subordinate legislation made under the relevant
statute or statutory provision and any directive, statute, enactment, law,
order, regulation or provision that amends, extends, consolidates or replaces
the same or that has been amended, extended, consolidated or replaced by the
same.

 

1.2 References to a repayment of Tax shall include any repayment supplement or
interest in respect of it.

 

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1.3 Any reference to something occurring in the ordinary course of business
shall not include:

 

  (a) anything that involves, or leads directly or indirectly to, any liability
of any Group Company to Tax that is (or but for an election would have been) the
primary liability of, or properly attributable to, or due from another Person
(other than a member of the Buyer’s Tax Group);

 

  (b) anything that relates to or involves the acquisition or disposal (or
deemed acquisition or disposal) of an asset or the supply of services (including
the lending of money, or the hiring or licensing of tangible or intangible
property) in a transaction that is not entered into on arm’s length terms;

 

  (c) anything that relates to or involves the making of a distribution or
deemed distribution for Tax purposes, the creation, cancellation or
reorganisation of share or loan capital, the creation of, or any Group Company
becoming or ceasing to be, or being treated as ceasing to be, a member of, a
group of companies, or any Group Company becoming or ceasing to be associated or
connected with any other company for any Tax purposes;

 

  (d) anything that relates to any scheme, transaction or arrangement that gives
rise, or may give rise, to a Liability to Taxation under any anti-avoidance
legislation, that is designed partly or wholly (or contains steps or stages
designed partly or wholly) to avoid, reduce or defer a Liability to Taxation, or
that gives rise to a duty to notify a Tax Authority under any legislation
introduced to counter tax avoidance;

 

  (e) anything that gives rise to a Liability to Taxation on deemed (as opposed
to actual) Profits or to the extent that it gives rise to a Liability to
Taxation on an amount of Profits greater than the difference between the sale
proceeds of an asset and the amount attributable to that asset in the Accounts
or, in the case of an asset acquired since the Accounts Date, the cost of that
asset;

 

  (f) anything that involves, or leads directly or indirectly to, a change of
residence of any Group Company for Tax purposes; nor

 

  (g) any liability arising as a result of the failure to properly deduct or
account for Tax, or to comply with the provisions of any Tax legislation or
subordinate legislation (including regulations) and any act, omission or
transaction that gives rise to any fine, penalty, surcharge, interest or other
imposition relating to any Tax.

 

1.4 Any stamp duty (or equivalent charge in any other jurisdiction) charged on
any document (or in the case of a document that is outside the United Kingdom,
any stamp duty that would be charged on the document if it were brought into the
United Kingdom) that is necessary to establish the title of the Company to any
asset, and any interest, fine or penalty relating to the stamp duty(or
equivalent charge in any other jurisdiction), shall be deemed to be a liability
of the Company to make an actual payment of Tax because of an Event occurring on
the last day on which it would have been necessary to pay the stamp duty (or
equivalent charge in any other jurisdiction) to avoid any liability to interest
arising on it.

 

1.5 References to the due date for payment of any Tax shall mean the last day on
which that Tax may, by law, be paid without incurring any penalty, fine,
surcharge, interest, charges, costs or other similar imposition (after taking
into account any postponement of the date that was obtained for the payment of
that Tax).

 

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Part 2

 

(Tax Covenant)

 

2 TAX COVENANT

 

2.1 The Sellers severally covenant to pay to the Buyer an amount equal to:

 

  (a) any Liability to Taxation arising as a result of any Event occurring on or
before Completion; or

 

  (b) any Deemed Liability to Taxation;

 

  (c) any Liability to Taxation of the Company in respect of, or by reference
to, any Profits earned, accrued or received on or before Completion; or

 

  (d) any Liability to Taxation that arises from the grant, exercise, release,
vesting, variation or cancellation at any time of a right acquired by any
employee or director of any Group Company before Completion to acquire
securities or an interest in securities; or

 

  (e) any Liability to Taxation that arises due to any Event that occurs after
Completion under a legally binding obligation (whether or not conditional)
entered into by any Group Company on or before the Completion otherwise than in
the ordinary course of business; or

 

  (f) any Liability to Taxation arising as a result of or in connection with any
liability to operate PAYE, account for employment Tax or to deduct or account
for National Insurance or social security contributions (or similar or
corresponding obligations) as a result of or in connection with the issue or
transfer of securities or an interest in securities on or before Completion; or

 

  (g) any Liability to Taxation being a liability of any Group Company to make a
payment, or to make a repayment of the whole or any part of any payment, to any
Person (other than a member of the Buyer’s Tax Group) in respect of any Group
Relief or allowance under any arrangement or agreement entered into by any Group
Company on or before Completion save to the extent that the payment or repayment
is reflected in the Accounts;

 

  (h) any Liability to Taxation arising as a result of or in connection with the
loss, in whole or in part, of the right of any Group Company to receive any
payment (other than from a member of the Buyer’s Tax Group) for any Group Relief
or allowance under any arrangement or agreement entered into on or before
Completion where the payment was taken into account in the Accounts;

 

  (i) any Liability to Taxation which arises solely as a result of the
relationship for Tax purposes before Completion of any Group Company with any
Person other than a member of the Buyer’s Tax Group, whether arising before or
after Completion;

 

  (j) all third party costs and expenses reasonably and properly incurred by the
Buyer or the relevant Group Company in connection with any Tax Claim in respect
of which the Sellers may be liable under paragraph 2.1 or in successfully
bringing any claim action under the provisions of this Schedule.

 

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Date for payment

 

2.2 Where the Sellers become liable to make any payment under paragraph 2.1, the
due date for the making of that payment (which shall be in cleared funds) shall
be 5 Business Days following a written demand from the Buyer to the Sellers’
Representative or, if later:

 

  (a) in a case that involves an actual payment of Taxation by any Group
Company, or falls within paragraph 2.3(b)(iii) and involves a payment of
Taxation that would not have arisen but for the loss, the date falling 5
Business Days before the last date on which the relevant Group Company is liable
to pay (or would be so liable, on the assumption that the relevant Group Company
would have been able to fully utilise the Relief in the accounting period during
which the Accounts Relief was lost) to the appropriate Tax Authority the
Taxation in question in order to avoid incurring a liability to interest or
penalties;         (b) in a case that falls within paragraph 2.3(b)(i), the date
that the repayment would have been made by the relevant Tax Authority; and      
  (c) in a case that falls within paragraph 2.3(b)(ii) or 2.3(c), the date
falling 5 Business Days before the date on which the Taxation saved would
otherwise have become payable to the relevant Tax Authority.

 

  Amount of Liability to Taxation  

 

2.3 The amount that is to be treated as a Liability to Taxation shall be:

 

  (a) in the case of a liability under (a) of the definition of Liability to
Taxation, the amount of the payment or repayment;         (b) in the case of a
liability under (b) of the definition of Liability to Taxation,

 

  (i) if the Accounts Relief is a right to repayment of Tax, the amount of the
repayment that is lost,         (ii) the amount of Taxation saved as a result of
the Loss of the Accounts Relief, if the Accounts Relief utilised, including the
setting off against any liability to Taxation or against Profits, or        
(iii) in any other case, the amount of Taxation that would have been saved but
for the Loss of the Accounts Relief on the assumption that the Company would
have been able to fully utilise the Relief in the accounting period during which
the Accounts Relief was lost;

 

  (c) in the case of a liability under (c) of the definition of Liability to
Taxation, the amount of Taxation that has been saved in consequence of the
setting off.

 

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Part 3

 

(Limitations and general)

 

3 LIMITATIONS ON LIABILITY

 

3.1 The liability of the Sellers under the Tax Covenant shall be reduced if and
to the extent that the Liability to Taxation shall have been reflected in
damages and recovered for breach of a Warranty or otherwise recovered in respect
of a breach of or pursuant to any part of the Tax Covenant or Agreement (and
vice versa).

 

3.2 The Sellers shall not be liable to the Buyer for a Tax Claim in respect of
any Liability to Taxation or other liability to the extent that:

 

  (a) specific allowance, provision or reserve (other than a provision for
deferred Tax) in respect of that Liability to Taxation or other liability was
included in the Accounts or payment or discharge of it was taken into account
therein; or         (b) the Liability to Taxation or other liability arises or
is increased as a result of:

 

  (i) any increase in rates of Taxation; or         (ii) any change in law; or  
      (iii) in the published practice of any Tax Authority; or         (iv) any
change in accounting practice or principles or any change in the bases on which
the accounts of any Group Company are prepared except in each case in order to
comply with generally accepted accounting practice at the Accounts Date; or    
    (v) any change in the date to which any Group Company makes up its accounts,
made in any such case after Completion; or

 

  (c) such Liability to Taxation or other liability would not have arisen but
for a voluntary act or omission carried out or effected by the Buyer or any
Group Company at any time after Completion, other than any act or omission:

 

  (i) which the Buyer did not know and could not reasonably have known that the
act or omission might give rise to the Liability to Taxation or other liability;
or         (ii) which was carried out or effected under a legally binding
commitment created on or before Completion; or

 

  (d) such Liability to Taxation or other liability is:

 

  (i) upon Profits which were earned, accrued or received by any Group Company;
or         (ii) upon any Event, in each case since the Accounts Date in the
ordinary course of the business of the relevant Group Company;

 

  (e) there is available to the relevant Group Company at no cost to the Buyer
or any Group Company to relieve or mitigate such Liability to Taxation or other
liability any Relief which is not a Buyer’s Relief;

 

74

 

 

  (f) such Liability to Taxation or other liability can be properly and fully
discharged out of moneys deducted for the purpose from sums payable or paid by
any Group Company to the extent that the moneys so deducted are not reflected in
Accounts;

 

  (g) it would not have arisen or would have been reduced or eliminated but for:

 

  (i) a failure or omission on the part of the Buyer or any Group Company after
the Accounts Date to make, adjust or revise, any claim, election, surrender or
disclaimer or to give any notice or consent or to do any other thing, the
making, adjustment, revision, giving or doing of which was:

 

  (A) taken into account in computing the provision or reserve for Tax in the
Accounts,         (B) the Buyer or the relevant Group Company was or reasonably
should have been aware was required in order to achieve the position reflected
in the Accounts; and         (C) was not required under applicable legislation
to be done before the Accounts Date in order to be effective or to avoid the
imposition of any penalty; or

 

  (ii) any claim, election, surrender, disclaimer, notice, consent or other
action made, adjusted, revised, given or done after the Accounts Date by any
Group Company or the Buyer or any other Person connected with them where the
making, adjustment, revision, giving or doing of such claim, election,
surrender, disclaimer, notice, consent or other thing was not assumed or
reflected in computing the provision or reserve for Tax in the Accounts; or.

 

  (h) such Liability to Taxation or other liability is in respect of stamp duty
or stamp duty reserve tax or similar tax in any jurisdiction payable on the
transfer or agreement to transfer the Target Shares pursuant to this Agreement;
or         (i) the Profits in respect of which such Liability to Taxation or
other liability arises were actually earned, accrued or received by a Group
Company before the Accounts Date but were not reflected in the Accounts;        
(j) such Liability to Taxation or other liability has been satisfied, discharged
or made good or a Group Company is compensated without cost or loss to any
member of the Buyer’s Tax Group;         (k) such Liability to Taxation would
not have arisen but for a cessation, transfer or winding up or change in the
nature or conduct, in each case after Completion, of any trade or business
carried on by a Group Company at Completion;         (l) such Liability to
Taxation is a liability to interest or penalties and arises or is increased
solely as a consequence of any failure by the Buyer or any Group Company to make
payment to the relevant Tax Authority of an amount of Tax equal to the payment
made by the Sellers under this Schedule in respect of such Tax not later than
two Business Days following the date such payment is made by the Sellers;      
  (m) such Liability to Taxation or other liability arises or is increased as a
result of a Group Company after Completion or the Buyer failing to act in
accordance with any of its obligations set out in this Schedule;         (n)
such Liability to Taxation arises by virtue of the rate of Tax applicable to the
Profits of any Group Company increasing as a result of becoming a member of the
Buyer’s Tax Group.

 

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4 REPAYMENT

 

4.1 If the Sellers have paid the Buyer an amount in full in respect of any Tax
Claim and the Buyer or any Group Company either is entitled to recover from any
Person (not being a Group Company but including any Tax Authority) any sum in
respect of the liability that has resulted in that payment or at some subsequent
date (falling not later than the later of 7 years after Completion and four
years after the payment by the Sellers) becomes entitled to make such a
recovery, then the Buyer shall or shall procure that the relevant Group Company
promptly notifies the Sellers’ Representative of their entitlement. If so
required by the Sellers’ Representative and subject to first being indemnified
to the Buyer’s reasonable satisfaction (which may include the giving of an
indemnity by the Sellers’ jointly and severally) against any loss, cost,
liability or expense (including any additional Liability to Taxation) the Buyer
shall take (and shall procure that the relevant Group Company shall take) all
commercially reasonable steps to enforce that recovery (keeping the Sellers’
Representative fully informed of the progress of any action taken), provided
that the Buyer shall not be required to engage in litigation (or procure that
the relevant Group Company engages in litigation) beyond the Upper Tier Tax
Tribunal unless it has been advised by Tax Counsel that such litigation is, on a
balance of probabilities, likely to succeed.

 

4.2 If the Buyer or the relevant Group Company subsequently makes recovery
pursuant to paragraph 4.1 or otherwise receives from any Tax Authority or any
Person (other than another Group Company) any amount referable to the subject
matter of the relevant Tax Claim, the Buyer shall account to the Sellers for the
lesser of:

 

  (a) a sum equal to such amount (less any Taxation suffered on the receipt
thereof); and

 

  (b) a sum equal to the Tax Claim paid by the Sellers to the Buyer (less any
Taxation suffered on the receipt thereof).

 

5 OVER-PROVISION AND RELIEFS

 

5.1 If on or before the seventh anniversary of Completion, the auditors for the
time being of any Group Company confirm in writing (on instruction of the
relevant Group Company but at the request and expense of the Sellers) that any
provision for Taxation (excluding any provision for deferred taxation) in the
Accounts has proved to be an over-provision, then the amount of such
over-provision shall be dealt with in accordance with paragraph 5.3 below
provided that clause 5.3 shall not apply to any overprovision to the extent that
it arises:

 

  (a) by reason of the availability for Buyer’s Relief; or         (b) as a
result of:

 

  (i) any increase in rates of Taxation; or         (ii) any change in law or
the judicial interpretation of any law; or         (iii) in the published
practice of any Tax Authority; or         (iv) any change in accounting practice
or principles or any change in the bases on which the accounts of any Group
Company are prepared except in either each case in order to comply with
generally accepted accounting practice; or         (v) any change in the date to
which any Group Company makes up its accounts, made in any such case after
Completion; or

 

  (c) as a result of a voluntary act or omission carried out or effected by the
Buyer or the relevant Group Company at any time after Completion, other than any
act or omission which was carried out or effected under a legally binding
commitment created on or before the Accounts Date.

 

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5.2 If on or before the seventh anniversary of the Completion Date, the auditors
for the time being of the relevant Group Company shall confirm in writing (at
the request and expense of the Sellers) that any Liability to Taxation or other
liability which has resulted in a payment having been made or becoming due from
the Sellers under the Tax Covenant or for breach of any Tax Warranty will give
rise to a Relief for that Group Company (other than a Buyer’s Relief) which
would not otherwise have arisen, then as and when such Relief reduces a
liability to make an actual payment of Tax (other than a liability for which the
Buyer would be entitled to bring a Tax Claim), the amount of that reduction
shall be dealt with in accordance with paragraph 5.3 below.     5.3 Where it is
provided under paragraphs 5.1 or 5.2 that any amount (the “relevant amount”) is
to be dealt with in accordance with this sub-paragraph:

 

  (a) the relevant amount shall first be set-off against any payment then due
from the Sellers under the Tax Covenant or for breach of any of the Tax
Warranties;         (b) to the extent that there is an excess, a refund shall be
made to the Sellers of any previous payment made by the Sellers under the Tax
Covenant or for breach of any of the Tax Warranties (to the extent not
previously refunded under this paragraph 5.3 and net of any Taxation suffered on
the receipt thereof) up to the amount of such excess; and         (c) to the
extent that the excess referred to in paragraph 5.3(b) above is not exhausted
under that paragraph, the remainder of the excess shall be carried forward and
set off against any future payment or payments which become due from the Sellers
under the Tax Covenant or for breach of any of the Tax Warranties.

 

5.4 After the relevant Group Company’s auditors have produced any confirmation
under paragraph 5.1 or 5.2, the Sellers’ Representative or the Buyer may, at any
time before the seventh anniversary of Completion, request the auditors for the
time being of the relevant Group Company to review (at the expense of the party
requesting the review) that confirmation in the light of all relevant
circumstances, including any facts of which it was not aware, and which were not
taken into account, at the time when such confirmation was given, and to certify
whether in their opinion the confirmation remains correct or whether, in light
of those circumstances, it should be amended.

 

5.5 If the auditors make an amendment to the earlier certificate and the amount
of the over-provision is revised, that revised amount shall be substituted for
the previous amount and any adjusting payment that is required in order to leave
the parties in the same financial position as they would have been in had the
previous confirmation shown the revised amount shall be made by or to the
Sellers (as the case may be) as soon as practicable.

 

6 CLAIMS PROCEDURE

 

6.1 On the Buyer or any Group Company becoming aware of a Claim for Taxation
which may result in a Tax Claim or that such a Claim for Taxation may be made
the Buyer shall:

 

  (a) as soon as reasonably practicable give written notice of that actual or
potential Claim for Taxation to the Sellers’ Representative or, as the case may
be, shall procure that the relevant Group Company shall as soon as reasonably
practicable gives written notice of that actual or potential Claim for Taxation
to the Sellers’ Representative, along in each case with all information
reasonably available to the Buyer and any Group Company which relate to the
actual or potential Claim for Taxation in question;         (b) subject always
to the terms of this paragraph 6 and to the Sellers jointly and severally
indemnifying the Buyer and the relevant Group Company to the Buyer’s reasonable
satisfaction against all losses, costs, damages and expenses (including any
additional Liability to Taxation), which may be properly incurred, procure that
the relevant Group Company take such action and give such information and
assistance in connection with the affairs of the relevant Group Company as the
Sellers’ Representative may reasonably by written notice request to avoid,
resist, dispute, appeal or compromise the Claim for Taxation; and

 

77

 

 

  (c) subject as mentioned in paragraph (b) above, procure that the Sellers’
Representative is promptly provided with copies of any material correspondence
with the Tax Authority and all other information (including without limitation
correspondence with and advice received from professional advisers) in
connection with the Claim for Taxation.

 

6.2 The Buyer shall, or shall procure that each Group Company shall:

 

  (a) ensure that no material correspondence or other document relating to the
Claim for Taxation is sent or issued by the Buyer, any Group Company or their
advisers before the Sellers’ Representative has been given a reasonable
opportunity to comment on it, and take any reasonable comments of the Sellers’
Representative into account in finalising such correspondence or document; and  
      (b) make no admission, settlement or compromise in respect of the Claim
for Taxation without the Sellers’ Representative’s prior written consent, such
consent not to be unreasonably withheld or delayed.

 

6.3 The Buyer shall not be obliged to procure that the relevant Group Company
takes any action under clause 6.2 above and shall be entitled to take, or
procure that there is taken, such action as the Buyer in its sole discretion
decides to avoid, resist, dispute, appeal or compromise the Claim for Taxation
(including settling it on such terms as the Buyer in its sole discretion
decides) if:

 

  (a) the Sellers’ Representative, having been given written notice of the
receipt of that Claim for Taxation in accordance with paragraph 6.1 above, the
Buyer has not within 21 days (or, if there is a statutory time limit of not more
than 30 days to notify or lodge an appeal, within 14 days) thereafter received
instructions in writing from the Sellers’ Representative, in accordance with the
preceding provisions of this paragraph 6, to make that appeal; or

 

  (b) the Sellers shall fail to indemnify the relevant Group Company as
mentioned in paragraph (b) of clause 6.1 above.

 

6.4 The Buyer shall not be obliged to procure that the relevant Group Company
take any action under paragraph 6.1 above which involves contesting before any
court or tribunal beyond the Tax Chamber of the First-tier Tribunal unless the
Sellers Representative promptly furnishes the Buyer with the written opinion of
Tax Counsel to the effect that the appeal in question is, on the balance of
probabilities, likely to succeed. Such Tax Counsel shall be instructed by the
Sellers Representative and at the Sellers’ expense.     7 TAX RETURNS     7.1
The Sellers’ Representative or their duly authorised agent shall at the expense
of the Group Company concerned up to an aggregate amount of £25,000 and as to
any excess at the Sellers’ sole expense prepare the tax returns and computations
of each Group Company for all periods ended on or before the Completion Date to
the extent that they have not been prepared prior to the Completion Date (the
“Pre-Accounts Date Returns”).     7.2 The Sellers’ Representative shall provide
drafts of each Pre-Accounts Date Return in the form in which the Sellers’
Representative propose that they should be submitted to a Tax Authority to the
Buyer at least 28 days before submission of the Pre-Accounts Date Return in the
form in which the Sellers’ Representative propose that they should be submitted
to a Tax Authority to the Buyer at least 28 days before submission of the
Pre-Accounts Date Return. The Sellers’ Representative shall consider in good
faith and take into account in finalising each Pre-Accounts Date Return the
Buyer’s reasonable comments as may be provided in writing by the Buyer or its
advisers to the Sellers’ Representative within 14 days after the Sellers’
Representative have provided drafts to the Buyer as mentioned in this clause 7.2
and shall provide the Pre-Accounts Date Return (reflecting such comments) to the
Buyer.

 

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7.3 Subject to the Sellers’ Representative complying with their obligations
under paragraph 7.2 above, the Buyer shall procure that the relevant Group
Company shall cause the Pre-Accounts Date Return mentioned in paragraphs 7.1 and
7.2 above to be authorised, signed (where signing is required) and submitted to
the appropriate Tax Authority provided that the Buyer shall not be obliged to
procure that the relevant Group Company takes any such action as is mentioned in
this paragraph 7 in relation to any tax return that is not true and accurate in
all material respects.     7.4 The Sellers’ Representative or their duly
authorised agent shall at the Sellers’ sole expense prepare all documentation
and deal with all matters (including correspondence) relating to the tax returns
of each Group Company for all accounting periods ended on or prior to the
Completion Date provided that the Sellers shall provide the Buyer with copies of
any correspondence relating to such tax returns prior to their submission and
copies of any correspondence from a Tax Authority and notes of meetings or
substantive telephone calls with a Tax Authority. The Sellers’ Representative
shall give the Buyer a reasonable opportunity to comment to the Sellers’
Representative on such correspondence prior to submission and shall take account
of the Buyer’s reasonable comments.     7.5 The Buyer shall provide the Sellers’
Representative with a draft of any tax return relating to the period current at
the Completion Date at least 28 days prior to the date for submission of that
tax return. The Buyer shall incorporate the Sellers’ Representative’s reasonable
comments in relation to any part of the period ending on or prior to the
Completion Date as may be provided in writing by the Sellers’ Representative to
the Buyer or its advisers within 14 days after the Buyer has provided a draft to
the Buyer as mentioned in this paragraph 7.5.     7.6 The Buyer shall upon
reasonable written notice (having regard to the circumstances) being given by
the Sellers’ Representative procure that the relevant Group Company shall afford
such access to its books, accounts and records and Personnel as is necessary and
reasonable to enable the Sellers or their duly authorised agent to prepare those
tax returns and conduct matters relating thereto in accordance with the Sellers’
rights and obligations under this paragraph 7.     7.7 The Buyer shall procure
that each Group Company shall at the written request of the Sellers’
Representative do all such things which may be reasonably necessary to ensure
that full effect is given to any claim, election, surrender, disclaimer, notice
or consent made to or by that Group Company and which is reflected or taken into
account in the Accounts and expressly described in the Disclosure Letter,
including for the avoidance of doubt signing and submitting any revised claim,
election, surrender, disclaimer, notice or consent and progressing any such
claim, election, surrender, disclaimer, notice or consent or revised claim,
election, surrender, disclaimer, notice or consent with the relevant Tax
Authority.     8 BUYER’S COVENANT     8.1 The Buyer covenants with the Sellers
to pay to each Seller an amount equal to any liability or increased liability to
Taxation of that Seller (or any Person associated or connected with that Seller
for any Taxation purpose) which arises as a consequence of or by reference to
any Group Company failing to pay any amount of Taxation for which it is liable
after Completion.     8.2 The covenant contained in Paragraph 8.1 shall not
apply to Taxation:

 

  (a) to the extent the Buyer could make a claim against the Sellers pursuant to
this Schedule in respect of that Taxation (save where the Buyer has received
payment from the Sellers in respect of that Taxation pursuant to such a claim
but the relevant Group Company has not paid the Taxation to the relevant Tax
Authority or where a limitation in Paragraph 3.2 applies); or         (b) which
the relevant Seller has already recovered under any relevant statutory provision
(and each Seller shall procure that no such recovery is sought by them to the
extent payment is made hereunder).

 

8.3 Subject as provided in this Schedule, the Buyer covenants to each Sellers to
pay to each Seller an amount equal to all costs or expenses reasonably and
properly incurred by each Seller in connection with or in consequence of any
liability to Taxation or increased liability to Taxation for which the Buyer is
liable pursuant to Paragraph 8.1 or in successfully taking any action under this
Paragraph 8.

 

79

 

 

SIGNATURES

 

EXECUTED as a deed by BOXLIGHT CORPORATION acting by a director in the presence
of:

 

Signature

 

/s/ Michael Pope 

  Director

 

Signature of witness /s/ Megan Pope         Name (in CAPITAL LETTERS) MEGAN POPE
        Address 945 Sentry Ridge Crossing, Suwanee, GA 30024 USA                
   

 

EXECUTED as a deed and delivered by NIGEL BATLEY in the presence of:

Sign here

 

  /s/ Nigel Batley

 

Signature of witness /s/ Martin Batley         Name (in CAPITAL LETTERS) MARTIN
BATLEY         Address 5 Ashley Road, Sevenoaks, Kent, TN13 3AN              

 

EXECUTED as a deed and delivered by KEVIN BATLEY in the presence of:

Sign here

 

  /s/ Kevin Batley

 

Signature of witness /s/ Martin Batley         Name (in CAPITAL LETTERS) MARTIN
BATLEY         Address 5 Ashley Road, Sevenoaks, Kent, TN13 3AN  

 

 

 

 

EXECUTED as a deed and delivered by Annette BATLEY in the presence of:

Sign here     /s/ Annette Batley

 

Signature of witness /s/ Martin Batley         Name (in CAPITAL LETTERS) MARTIN
BATLEY         Address 5 Ashley Road, Sevenoaks, Kent, TN13 3AN              

 

EXECUTED as a deed and delivered by Sheila BATLEY in the presence of:

Sign here

 

  /s/ Sheila Batley

 

Signature of witness /s/ Martin Batley         Name (in CAPITAL LETTERS) MARTIN
BATLEY         Address 5 Ashley Road, Sevenoaks, Kent, TN13 3AN              

 

EXECUTED as a deed and delivered by Shaun Marklew in the presence of:

Sign here

 

  /s/ Shaun Marklew

 

Signature of witness /s/ Sarah Marklew         Name (in CAPITAL LETTERS) SARAH
MARKLEW         Address Caxton House, Hurtis Hill, Crowborough, East Sussex, TN6
3BL  

 

2

 

 

EXECUTED as a deed and delivered by Simon Chidsey in the presence of:

Sign here

 

  /s/ Simon Chidsey

 

Signature of witness /s/ Pamela Chidsey         Name (in CAPITAL LETTERS) PAMELA
CHIDSEY         Address 6 Parker Lane, Mirfield, West Yorkshire, WF14 9NY  

 

3