Kroll Inc – ‘8-K’ for 4/23/01

On:  Wednesday, 4/25/01, at 5:26pm ET   ·   For:  4/23/01   ·   Accession #:  922423-1-500069   ·   File #:  0-21629

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Current Report   —   Form 8-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 8-K         Current Report                                        81    365K 

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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------------------

FORM 8-K

CURRENT REPORT
 PURSUANT TO SECTION 13 OR 15 (d) OF
 THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): April 23, 2001

----------

THE KROLL-O'GARA COMPANY
(Exact name of registrant as specified in its charter)

       Ohio                       000-21629                 31-1470817
(State or other jurisdiction of  (Commission file number)     (I.R.S. employer  
incorporation or organization)                               identification no.)

9113 LeSaint Drive,                                                   
Fairfield, Ohio                                            45014  
(Address of principal                                       (Zip code)  
executive offices)                                                  

Registrant's telephone number, including area code: (513) 874-2112

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Item 5.           Other Events.                                                 

      On April 23, 2001, The Kroll-O'Gara Company (the "Company") announced that
it has entered into a stock purchase agreement to sell its Security Products and
Services Group (the "O'Gara Group") to Armor Holdings, Inc. ("Armor").          

  In the proposed transaction, the Company will sell the O'Gara Group to
Armor for an aggregate purchase price of up to $54.5 million, of which up to    
$15.0 million may be paid, at Armor's option, in shares of its common stock     
valued at the time of closing, and the balance is payable in cash. The purchase 
price will be reduced dollar for dollar to the extent that net tangible assets, 
as defined in the stock purchase agreement, are less than approximately $37.4   
million. Subject to the achievment of certain performance goals, the Company may
be entitled to up to $2.0 million of additional consideration. The closing of   
the transaction is subject to a number of conditions, including approval by     
certain regulatory authorities and third parties, including the Company's       
lenders.                                                                        

      The O'Gara Group comprises the Security Products and Services Group of the
Company, which includes the manufacture, distribution, sale and marketing of    
armored motor vehicles and related services and training programs. The Company  
will not sell its kidnap and ransom and risk information services businesses to 
Armor, and will continue to operate them as part of its remaining business.     

    The proposed transaction is expected to close late in the second quarter
or in the third quarter of 2001. The Boards of Directors of both companies have 
approved the transaction and shareholder approval is not required.              

      The foregoing discussion is qualified by reference to the full text of the
stock purchase agreement, which is filed as an exhibit to this report in Form   
8-K and is incorporated herein by reference in its entirety.                    

Item 7.           Financial Statements and Exhibits.                            

(c)   Exhibits                                                                  

99    Stock Purchase Agreement dated as of April 20, 2001 by and among the      
Kroll-O'Gara Company, O'Gara-Hess & Eisenhardt Armoring Company, The
   O'Gara Company and O'Gara Security Associates, Inc. and Armor Holdings,
Inc. and Bengal Acquisition Corp.                                   

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 SIGNATURE

    Pursuant to the requirements of the Securities Exchange Act of 1934, The
Kroll-O'Gara Company has duly caused this report to be signed on its behalf by  
the undersigned thereunto duly authorized.                                      

Date: April 24, 2001                                                            

                THE KROLL-O'GARA COMPANY

                  By: /s/ Nazzareno Paciotti
                         ---------------------------
                Nazzareno Paciotti
                     Chief Financial Officer

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                                                                      Exhibit 99

================================================================================

STOCK PURCHASE AGREEMENT

BY AND AMONG

 ARMOR HOLDINGS, INC., A DELAWARE CORPORATION,

 BENGAL ACQUISITION CORP., A DELAWARE CORPORATION, AS PURCHASER,

 AND

THE KROLL-O'GARA COMPANY, AN OHIO CORPORATION,

 AS SELLER OF THE CAPITAL STOCK OF

O'GARA-HESS & EISENHARDT ARMORING COMPANY,
 THE O'GARA COMPANY, AND
O'GARA SECURITY ASSOCIATES, INC.

DATED AS OF APRIL 20, 2001

================================================================================

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                                                                          Page

ARTICLE I. DEFINITIONS.......................................................1  

ARTICLE II. PURCHASE OF SECURITIES; CONSIDERATION............................9  

   2.1 Purchase of Securities..............................................9
   2.2 Consideration......................................................10
   2.3 Certain Closing Adjustments and Covenants..........................10
   2.4 [Intentionally Omitted]............................................13
   2.5 Calculation of Deferred Consideration..............................13
   2.6 Resale of Consideration Shares.....................................14
   2.7 Section 338(h)(10) and Section 338(g) Elections....................14

ARTICLE III. REPRESENTATIONS AND WARRANTIES OF PURCHASER....................14  

   3.1 Organization; Standing and Power...................................14
   3.2 Authorization; Enforceability......................................15
   3.3 No Violation or Conflict...........................................15
   3.4 Consent of Governmental Authorities................................15
   3.5 Brokers............................................................15
   3.6 Public Documents; Compliance.......................................16
   3.7 Consideration Shares...............................................16
   3.8 Registration Statement.............................................16
   3.9 Litigation.........................................................16

ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF THE SELLER AND THE COMPANIES..17  

   4.1 Organization.......................................................17
   4.2 Authorization; Enforceability......................................18
   4.3 No Violation or Conflict...........................................18
   4.4 Consents of Governmental Authorities...............................18
   4.5 Conduct of Business................................................18
   4.6 Litigation; Disputes...............................................19
   4.7 Brokers............................................................19
   4.8 Compliance.........................................................20
   4.9 Charter, Bylaws, Code of Regulations and Corporate Records.........20
   4.10Capitalization of the Companies....................................21
   4.11Rights, Warrants, Options..........................................22
   4.12Financial Statements...............................................22
   4.13Absence of Undisclosed Liabilities.................................22
   4.14Title to Securities................................................23
   4.15Title to and Condition of Personal Property........................23
   4.16Real Property......................................................24

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   4.17Insurance..........................................................25
   4.18Governmental Authorizations........................................26
   4.19Intellectual Property Rights.......................................26
   4.20Major Customers and Suppliers; Supplies............................28
   4.21Related Parties....................................................28
   4.22List of Accounts and Proxies.......................................29
   4.23Employee Policies, Manuals, etc....................................29
   4.24Labor Relations....................................................29
   4.25Employee Benefit Plans.............................................30
   4.26Taxes..............................................................32
   4.27Material Agreements................................................33
   4.28Guaranties.........................................................36
   4.29Products...........................................................36
   4.30Environmental and Safety Matters...................................37
4.31Accounts Receivable, Notes Receivable, and Costs in               
       Excess of Billing..................................................37
   4.32Accounts and Notes Payable.........................................38
   4.33Inventory Valuation................................................38
   4.34Absence of Certain Business Practices..............................38
   4.35Review of Forms 10-K, 10-Q and 8-K.................................39
   4.36Public Documents; Compliance.......................................39
   4.37FIRPTA.............................................................39
   4.38Investment Representations.........................................39
   4.39No Claims..........................................................40
   4.40Disclosure.........................................................40
   4.41Assumptions in the Execution Date Legal Opinion....................40
   4.42Projections........................................................41

ARTICLE V. INDEMNIFICATION; RELEASES, ETC...................................41  

   5.1 Survival of the Representations and Warranties.....................41
   5.2 Investigation......................................................41
   5.3 Indemnification Generally..........................................41
   5.4 General Releases...................................................45
   5.5 Joint and Several Obligation.......................................45
   5.6 Tax Matters........................................................46
   5.7 Brazilian Tax-Related Indemnity....................................49

ARTICLE VI. CLOSING; CONDITIONS PRECEDENT; DELIVERIES.......................50  

   6.1 Closing; Effective Date............................................50
   6.2 Conditions Precedent to the Obligations of AHI and the Purchaser...50
   6.3 Conditions Precedent to the Obligations of the Seller..............54
   6.4 Execution Date Deliveries by the Seller and the Companies..........55
   6.5 Closing Date Deliveries by the Seller and the Companies............56
   6.6 Closing Date Deliveries by AHI and/or the Purchaser................57
   6.7 Best Efforts.......................................................57
   6.8 Termination........................................................57
   6.9 Liquidated Damages and Break-up Fees...............................59

ARTICLE VII. COVENANTS AND OTHER AGREEMENTS.................................60  

7.1 Interim Operations of the Seller, the Companies and the           
       Company Subsidiaries...............................................60
   7.2 Access.............................................................63
   7.3 Confidentiality (through Closing Date).............................63
   7.4 Notification.......................................................64
   7.5 Acquisition Proposals; No Solicitation.............................64
   7.6 Non-competition and Non-disparagement..............................64
   7.7 General Confidentiality............................................66
   7.8 Continuing Obligations; Equitable Remedies.........................67
   7.9 Change of Name.....................................................68
   7.10Advice of Changes..................................................68
   7.11Maintenance of Insurance...........................................68
   7.12Sale of the French Carosserie......................................68
   7.13Registration Statement.............................................69
   7.14HSR Application....................................................70
   7.15Transfers of Company Subsidiaries..................................70
   7.16Bank Consents......................................................71
   7.17ERISA Actions......................................................71
   7.18Inter-company Transfers............................................72
   7.19Assignment of Intellectual Property................................72
   7.20Aircraft Lease Transfer............................................72
   7.21Shareholder Approval...............................................72

ARTICLE VIII. MISCELLANEOUS.................................................73  

   8.1 Notices............................................................73
   8.2 Entire Agreement...................................................73
   8.3 Binding Effect.....................................................73
   8.4 Assignment.........................................................73
   8.5 Waiver and Amendment...............................................73
   8.6 No Third Party Beneficiary.........................................74
   8.7 Severability.......................................................74
   8.8 Fees and Expenses..................................................74
   8.9 Headings; Construction.............................................74
   8.10Counterparts.......................................................75
   8.11Time of the Essence................................................75
   8.12Injunctive Relief..................................................75
   8.13Remedies Cumulative................................................75

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   8.14Governing Law......................................................75
   8.15Jurisdiction and Venue.............................................75
   8.16Participation of Parties...........................................76
   8.17Further Assurances.................................................76
   8.18Publicity..........................................................76

 Table of Exhibits

Exhibit                Description                 Section Reference        
-------                -----------                 -----------------        

1       Form of Confidentiality and                  6.2(k)           
Non-competition Agreement                             
2       The Principal Stockholder Releases           6.2(n)           

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      STOCK PURCHASE AGREEMENT (the "Agreement"), dated as of April 20, 2001, by
and among The Kroll-O'Gara Company, an Ohio corporation (the "Seller");         
O'Gara-Hess & Eisenhardt Armoring Company, a Delaware corporation ("OHEAC"); The
O'Gara Company, an Ohio corporation ("O'Gara Company"); and O'Gara Security     
Associates, Inc., a Delaware corporation ("OSA" and, together with OHEAC and    
O'Gara Company, the "Companies"), Armor Holdings, Inc., a Delaware corporation  
("AHI"), Bengal Acquisition Corp., a Delaware corporation and a wholly-owned    
subsidiary of AHI ("Purchaser").                                                

PREAMBLE

     WHEREAS, the Seller owns all the outstanding capital stock of each of the
Companies;                                                                      

 WHEREAS, the Companies and their respective Subsidiaries comprise the
Security and Products and Services Group of the Seller, which includes the      
manufacture, distribution, sale and marketing of ballistic and blast protected  
armoring systems for commercial and military vehicles and aircraft and missile  
components, and the provision of security services, including advanced driver   
training, threat recognition and avoidance training, and firearms training.     

   WHEREAS, the Seller desires to sell to the Purchaser, and the Purchaser
desires to acquire, on the terms and subject to the conditions set forth in this
Agreement, all of the issued and outstanding capital stock of the Companies;    

      NOW, THEREFORE, in consideration of the premises and the respective mutual
covenants, representations and warranties herein contained, the parties hereto  
hereby agree as follows:                                                        

ARTICLE I.
 DEFINITIONS

   In addition to terms defined elsewhere in this Agreement, the following
terms when used in this Agreement shall have the meanings indicated below:      

      "Acquisition Proposal" shall have the meaning set forth in Section 7.5(a).

      "Additional Break-up Fee" shall have the meaning set forth in Section 6.9.

     "Affiliate" shall mean with respect to a specified Person, a partnership,
corporation, limited liability company, or any other Person which, directly or  
indirectly, through one or more intermediaries, controls or is controlled by or 
is under common control with such Person, and without limiting the generality of
the foregoing, includes, with respect to a Person (a) any other Person which    
beneficially owns or holds twenty percent (20%) or more of any class of voting  
securities or other securities convertible into voting securities of such Person
or beneficially owns or holds twenty percent (20%) or more of any other equity  
interests in such Person, (b) any other Person with respect to which such Person
beneficially owns or holds twenty percent (20%) or more of any class of voting  
securities or other securities convertible into voting securities of such       
Person, or owns or holds twenty percent (20%) or more of the equity interests of
the other Person, and (c) any director or executive officer of such Person. For 
purposes of this definition, the term "control" (including, with correlative    
meanings, the terms "controlled by" and "under                                  

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common control with"), as used with respect to any Person, means the possession,
directly or indirectly, of the power to direct or cause the direction of the    
management and policies of such Person, whether through the ownership of voting 
securities or by contract or otherwise.                                         

"Agents" shall have the meaning set forth in Section 7.5(a).        

  "Agreement" shall mean this stock purchase agreement together with all
exhibits and schedules referred to herein.                                      

"AHI" shall have the meaning set forth in the preamble hereof.      

     "AHI Common Stock" shall have the meaning set forth in Section 2.2(b)(i).

   "Aircraft Lease Assignment" shall have the meaning set forth in Section
7.20.                                                                           

"Applicable Law" shall mean, with respect to any Person, any        
international, national, regional, state or local treaty, statute, law,         
ordinance, rule, administrative action, regulation, order, writ, injunction,    
judgment, decree or other requirement of any Governmental Authority and any     
requirements imposed by common law or case law, applicable to such Person or any
of its properties, assets, officers, directors, employees, consultants or agents
(in connection with their activities on behalf of such Person or any of its     
Affiliates). Applicable Law includes, without limitation, Environmental and     
Safety Requirements, and state and local zoning and building laws.              

   "Average Closing Price" shall mean the average closing price of the AHI
Common Stock on the New York Stock Exchange for a ten (10) consecutive trading  
day period ending three (3) trading days prior to the relevant date of          
determination.                                                                  

      "Bank Consents" shall have the meaning set forth in Section 6.2(t) hereof.

"Break-up Fee" shall have the meaning set forth in Section 6.9.     

      "Bring Down Execution Date Legal Opinion" shall have the meaning set forth
in Section 6.2(j).                                                              

 "Bring Down Fairness Opinion" shall mean a fairness opinion of Sutter
Securities Incorporated reaffirming their opinion as set forth in the Seller's  
Fairness Opinion and confirming that the statements and conclusions set forth in
the Seller's Fairness Opinion are true and correct as of the Closing Date.      

"Carosserie" shall have the meaning set forth in Section 7.12.      

"Carosserie Sale" shall have the meaning set forth in Section 7.12. 

    "Cash at Closing" shall have the meaning set forth in Section 2.2(a)(i).

"CERCLA" shall have the meaning set forth in Section 4.30(c).       

"Claims" shall have the meaning set forth in Section 5.4.           

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"Closing" shall have the meaning set forth in Section 6.1.          

"Closing Date" shall mean the date that the Closing takes place.    

    "Closing Date Balance Sheet" shall have the meaning set forth in Section
2.3(b).                                                                         

    "Closing Payment" shall have the meaning set forth in Section 2.2(a)(i).

"Code" shall mean the Internal Revenue Code of 1986, as amended.    

   "Confidentiality and Non-Competition Agreements" shall have the meaning
set forth in Section 6.2(k).                                                    

"Companies" shall have the meaning set forth in the preamble hereof.

"Company Intellectual Property" shall have the meaning set forth in 
Section 4.19(a).                                                                

      "Company Subsidiary" shall mean any direct or indirect Subsidiary of any
of the Companies other than any direct or indirect Subsidiary of any Company    
which Subsidiary is the subject of a Company Subsidiary Transfer.               

      "Company Subsidiary Transfers" shall have the meaning set forth in Section
7.15.                                                                           

   "Competitive Business" shall have the meaning set forth in Section 7.6.

      "Consideration Shares" shall have the meaning set forth in Section 2.2(b).

     "Content" shall mean any and all information, pictures, images, graphics,
video, text, and any other content or information, in whatever form or on any   
media.                                                                          

"Deferred Consideration" shall have the meaning set forth in Section
2.2(a)(iii).                                                                    

     "Disclosure Schedule" shall mean the disclosure schedule attached hereto.

 "Determining Accountants" shall have the meaning set forth in Section
2.3(c).                                                                         

"DOJ" shall mean the Department of Justice of the United States.    

"Encumbrance" shall mean any claim, lien, charge, security interest,
pledge, mortgage, or any other restriction or encumbrance of any kind or nature.

 "Environmental and Safety Requirements" shall mean all Applicable Law
concerning public health and safety, worker health and safety and pollution or  
protection of the environment (including, without limitation, all those relating
to the presence, use, production, generation, handling, transport, treatment,   
storage, disposal, distribution, labeling, testing, processing, discharge,      
Environmental Release, threatened Environmental Release, control or cleanup of  
any hazardous or otherwise regulated materials, substances or wastes, chemical  
substances or mixtures, pesticides, pollutants, contaminants, toxic chemicals,  
petroleum products or distillates, asbestos, polychlorinated biphenyls, noise or
radiation).                                                                     

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     "Environmental Lien" shall mean any lien, whether recorded or unrecorded,
in favor of any Governmental Authority, relating to any liability of any of the 
Companies, or the Seller with respect to the Companies, arising under any       
Environmental and Safety Requirements.                                          

"Environmental Release" shall have the meaning set forth in CERCLA. 

"ERISA" shall have the meaning set forth in Section 4.25(a).        

     "Escrow Agent" shall mean the party to the Escrow Agreement who is to act
as escrow agent thereunder, including all successor escrow agents as provided in
the Escrow Agreement.                                                           

"Escrow Agreement" shall mean the Escrow Agreement among AHI, the   
Purchaser, and the Seller, in a form reasonably satisfactory to the parties     
thereto.                                                                        

  "Escrow Amount" shall have the meaning set forth in Section 2.2(a)(ii)
hereof.                                                                         

      "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the SEC thereunder.                            

"Execution Date Legal Opinion" shall mean that certain legal opinion
letter, addressed to the Seller, AHI, and the Purchaser and in form and         
substance satisfactory to AHI and the Purchaser, dated April 19, 2001, by       
Squire, Sanders & Dempsey, L.L.P., special Ohio counsel to the Seller, opining  
that the vote or other consent of the stockholders of the Seller is not required
to authorize the Seller to enter into this Agreement and carry out the terms    
hereof and consummate the transactions contemplated hereby.                     

    "Financial Statements" shall mean (a) the audited balance sheets and the
audited statements of income, cash flows and retained earnings of the Companies 
on a combined basis and consolidated with the Company Subsidiaries as of and for
the fiscal years ended December 31, 1999 and 1998, including the notes thereto  
and the reports thereon of the Seller's independent auditors, each prepared in  
accordance with GAAP, consistently applied with prior periods and (b) the       
unaudited balance sheet and the unaudited statement of income of the Companies  
on a combined basis and consolidated with the Company Subsidiaries as of and for
the fiscal year ended December 31, 2000.                                        

"401(k) Plan" shall have the meaning set forth in Section 7.17(a).  

"FTC" shall mean the Federal Trade Commission of the United States. 

     "GAAP" shall mean United States generally accepted accounting principles.

      "Governmental Authority" shall mean any domestic, international, national,
territorial, regional, state or local governmental authority, quasi-governmental
authority, instrumentality, court, commission, arbitrator or arbitration panel, 
or tribunal or any regulatory, administrative or other agency, or any political 
or other subdivision, department or branch of any of the foregoing.             

   "Governmental Authorizations" shall have the meaning given such term in
Section 4.18.                                                                   

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   "Governmental Contract MAE" shall have the meaning set forth in Section
4.27(d).                                                                        

"Gross Profit" shall have the meaning set forth in Section 2.5(b).  

      "Guaranty" shall mean, as to any Person, all liabilities or obligations of
such Person, with respect to any indebtedness or other obligations of any other 
person, which have been guaranteed, directly or indirectly, in any manner by    
such Person, through an agreement, contingent or otherwise, to purchase such    
indebtedness or obligation, or to purchase or sell property or services,        
primarily for the purpose of enabling the debtor to make payment of such        
indebtedness or obligation or to guarantee the payment to the owner of such     
indebtedness or obligation against loss, or to supply funds to or in any manner 
invest in the debtor, or otherwise.                                             

    "HSR Act" shall mean the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended, and the rules and regulations promulgated thereunder.         

   "Indemnified Party" shall have the meaning set forth in Section 5.3(c).

    "Indemnifying Party" shall have the meaning set forth in Section 5.3(c).

 "Insurance Organizations" shall have the meaning set forth in Section
4.16(d).                                                                        

"Intellectual Property" shall mean any United States, foreign,      
international and state patents and patent applications, industrial design      
registrations, certificates of invention and utility models (collectively,      
"Patents"); trademarks, service marks, and trademark or service mark            
registrations and applications, trade names, logos, designs, slogans, and       
general intangibles of like nature, together with all goodwill related to the   
foregoing (collectively, "Trademarks"); Internet domain names; copyrights,      
copyright registrations, renewals and applications for copyrights, including    
without limitation for the Content and the Software (each as defined herein)    
(collectively, "Copyrights"); Content; Software, technology, trade secrets and  
other confidential information, know-how, proprietary processes, formulae,      
algorithms, models and methodologies (collectively, "Trade Secrets"), rights of 
privacy and publicity, including but not limited to, the names, likenesses,     
voices and biographical information of real persons, and all license agreements 
and other agreements granting rights relating to any of the foregoing.          

   "Intellectual Property Assignments" shall have the meaning set forth in
Section 7.19.                                                                   

      "Kane Kessler Opinion" shall have the meaning set forth in Section 6.3(g).

 "Knowledge", "know", "known", and all other words of similar meaning,
whether or not capitalized, when used with respect to the Seller, the Companies,
or any of their respective Subsidiaries, shall mean the knowledge of any of     
Michael G. Cherkasky, Jules B. Kroll, Wilfred T. O'Gara, Nazzareno Paciotti,    
Steve Ratterman, Jerome Hoffman, Gary Allen, or Abram S. Gordon, including      
knowledge which was obtained after reasonable inquiry of Tony Russell, Ricardo  
Moreno, Olivier Robin, Daniel Bell and Adilson Parella.                         

    "Kramer Levin Naftalis & Frankel LLP Opinion" shall have the meaning set
forth in Section 6.2(i).                                                        

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  "Leased Property" shall have the meaning set forth in Section 4.16(a).

"Leases" shall have the meaning set forth in Section 4.16(a).       

"Liabilities" shall have the meaning set forth in Section 4.13.     

     "License Agreements" shall have the meaning set forth in Section 4.19(a).

  "Liquidated Damage Amount" shall have the meaning set forth in Section
6.9(b)(ii).                                                                     

"Litigation" shall have the meaning set forth in Section 4.6.       

"Losses" shall have the meaning set forth in Section 5.3(a).      

"MADSP" shall have the meaning set forth in Section 2.7.            

      "Material Agreements" shall have the meaning set forth in Section 4.27(a).

   "Material Adverse Change" shall mean any material adverse change in the
condition (financial or otherwise), results of operations, assets, liabilities, 
properties, or business of the Companies, taken as a whole, other than a        
material adverse change that arises out of or results from the announcement or  
consummation of the transactions contemplated by this Agreement.                

      "Material Adverse Effect" shall mean any change, event or condition of any
character, taken together with any and all other acts, omissions, conditions,   
changes, or events of any character which constitute breaches or violations of  
any representation or warranty herein, including any representation or warranty 
which has expired pursuant to Section 5.2, that is qualified by Material Adverse
Effect, which, in the aggregate, has had or is reasonably likely to have a      
material adverse effect on the condition (financial or otherwise), results of   
operations, assets, liabilities, properties, or business of the Companies taken 
as a whole or which is reasonably likely to prevent or delay the consummation of
the transactions contemplated hereby.                                           

      "Minimum Tangible Net Assets Requirement" shall have the meaning set forth
in Section 2.3(a).                                                              

     "Non-U.S. Anti-Trust Law" shall mean any anti-trust or similar law of any
Governmental Authority other than a Governmental Authority within the United    
States.                                                                         

 "Outstanding OHEAC Capital Stock" shall have the meaning set forth in
Section 4.10(a).                                                                

 "Outstanding O'Gara Company Capital Stock" shall have the meaning set
forth in Section 4.10(b).                                                       

"Outstanding OSA Capital Stock" shall have the meaning set forth in 
Section 4.10(c).                                                                

 "Owned Property" shall have the meaning set forth in Section 4.16(a).

"Permitted Encumbrances" shall mean any and all mechanics' liens,   
workmen's liens, common carrier liens, warehousemen's liens and other similar   
liens or Encumbrances incurred in                                               

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the ordinary course of business and any and all restrictions, easements or other
imperfections of title or Encumbrances on any Real Property or other property or
asset that do not materially diminish the value thereof or materially interfere 
with the use thereof in the operations of the Companies and the Company         
Subsidiaries.                                                                   

"Person" whether or not capitalized, shall mean any natural person, 
corporation, unincorporated organization, partnership, limited liability        
company, association, joint stock company, joint venture, trust or government,  
or any agency or political subdivision of any government or any other entity.   

 "Post-Closing Settlement" shall have the meaning set forth in Section
2.3(d).                                                                         

"Principal Stockholder Releases" shall have the meaning set forth in
Section 6.2(n).                                                                 

"Product" shall have the meaning set forth in Section 4.29.         

"Projections" shall have the meaning set forth in Section 4.42.     

"Purchaser Indemnified Parties" shall have the meaning set forth in 
Section 5.6(a).                                                                 

"Purchase Price" shall have the meaning set forth in Section 2.2(a).

"Purchaser" shall have the meaning set forth in the preamble hereof.

  "Purchaser's Certificates" shall have the meaning set forth in Section
6.3(c).                                                                         

    "Purchaser's Fairness Opinion" shall mean the opinion of Bear, Stearns &
Co. Inc. that the Securities to be received by the Purchaser in exchange for the
Purchase Price are fair to the stockholders of AHI from a financial point of    
view.                                                                           

"Real Property" shall have the meaning set forth in Section 4.16(a).

"Real Property Permits" shall have the meaning set forth in Section 
4.16(d).                                                                        

"Related Costs" shall have the meaning set forth in Section 5.6(a). 

"Related Party" shall have the meaning set forth in Section 4.21.   

      "Registration Statement" shall have the meaning set forth in Section 7.13.

"Review Period" shall have the meaning set forth in Section 2.3(b). 

 "SEC" shall mean the Securities and Exchange Commission of the United
States.                                                                         

      "Securities" shall mean, individually and/or collectively, the Outstanding
OHEAC Capital Stock, the Outstanding O'Gara Company Capital Stock, and the      
Outstanding OSA Capital Stock.                                                  

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   "Securities Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the SEC promulgated thereunder.                    

"Seller" shall have the meaning set forth in the preamble hereof.   

    "Seller's Chief Financial Officer's Certificates" shall have the meaning
set forth in Section 6.2(e).                                                    

      "Seller's Closing Tax Returns" shall have the meaning set forth in Section
5.6(d).                                                                         

   "Seller's Fairness Opinion" shall mean the opinion of Sutter Securities
Incorporated that the Purchase Price to be received by the Seller in exchange   
for the capital stock of the Companies is fair to the stockholders of the Seller
from a financial point of view.                                                 

 "Seller's Officers' Certificates" shall have the meaning set forth in
Section 6.2(d).                                                                 

"Seller's Taxes" shall have the meaning set forth in Section 5.6(c).

      "Software" shall mean any and all (i) computer programs, including any and
all software implementations of algorithms, models and methodologies, whether in
source code or object code form, (ii) databases, compilations, and any other    
electronic data files, including any and all collections of data, whether       
machine readable or otherwise, (iii) descriptions, flow-charts, technical and   
functional specifications, and other work product used to design, plan,         
organize, develop, test, troubleshoot and maintain any of the foregoing, (iv)   
without limitation to the foregoing, the software technology supporting any     
functionality contained on any of the Companies' Internet site(s), and (v) all  
documentation, including technical, end-user, training and troubleshooting      
manuals and materials, relating to any of the foregoing.                        

  "Straddle Returns" shall have the meaning set forth in Section 5.6(d).

"Subsidiary" of any Person shall mean any Person, whether or not    
capitalized, in which such Person owns, directly or indirectly, an equity       
interest of more than fifty percent (50%), or which may be controlled, directly 
or indirectly, by such Person.                                                  

"Sultan Receivable" shall have the meaning set forth in Section     
2.3(f)(ii).                                                                     

     "Tangible Net Assets" shall mean (i) assets of the Companies set forth on
Schedule 2.3 hereof, which in no event shall include balances for intercompany  
accounts receivable, deferred tax assets, net goodwill, net intangibles, or     
investments in subsidiaries less (ii) the liabilities of the Companies set forth
on Schedule 2.3 hereof, which in no event shall include balances for any        
revolving line of credit of the Seller or any of the Companies, the current     
portion of long term debt, intercompany payables, deferred taxes, long tem debt,
other long-term obligations, or the eliminating differences/balance account but 
shall include any debt related to fixed assets acquired as part of the          
transactions contemplated hereby and a provision for "risk in France" in the    
amount of $62,000.                                                              

 "Tangible Property" shall have the meaning set forth in Section 4.15.

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"TACOM" shall have the meaning set forth in Section 2.3(f)(i).      

 "TACOM Excess" shall have the meaning set forth in Section 2.3(f)(i).

"Tax Group" shall have the meaning set forth in Section 4.26.       

"Tax Election" shall have the meaning set forth in Section 2.7.     

  "Tax Notification Periods" shall have the meaning set forth in Section
5.6(f).                                                                         

     "Tax" means any federal, state, local, or foreign income, gross receipts,
license, payroll, employment, excise, severance, stamp, occupation, premium,    
windfall profits, environmental (including taxes under Code Section 59A),       
customs duties, capital stock, franchise, profits, withholding, social security 
(or similar), unemployment, disability, real property, personal property, sales,
use, transfer, registration, value added, alternative or add-on minimum,        
estimated, or other tax of any kind whatsoever, including any interest, penalty,
or addition thereto, whether disputed or not.                                   

    "Termination Date" shall mean June 30, 2001; provided, however, that the
Termination Date shall be extended daily until ten (10) days after the          
Registration Statement is declared effective; but in no event later than        
September 14, 2001. Notwithstanding the immediately preceding sentence, if the  
Seller chooses to seek the approval of its shareholders of this Agreement or the
transactions contemplated hereby as a result of either (i) the issuance of an   
order by a Governmental Authority enjoining the consummation of the transactions
contemplated hereby by reason of the failure of the Seller to obtain the        
approval of its shareholders of this Agreement and the transactions contemplated
hereby or (ii) the inability of the Seller to deliver the Bring Down Closing    
Date Legal Opinion due to a change in Ohio law, the Termination Date shall be   
extended for an additional ninety (90) days after the date such order is issued 
or such law is changed.                                                         

 "TNA Aircraft Adjustment" shall have the meaning set forth in Section
7.20.                                                                           

   "Transaction Expenses" shall have the meaning set forth in Section 6.9.

  "Transferred Company Subsidiaries" shall have the meaning set forth in
Section 7.15(g).                                                                

 "Uncollected Receivables" shall have the meaning set forth in Section
2.5(b).                                                                         

ARTICLE II. 
 PURCHASE OF SECURITIES; CONSIDERATION

     2.1 Purchase of Securities. Subject to the terms and conditions set forth
herein, on the Closing Date, the Seller shall sell to Purchaser, and Purchaser  
shall purchase from the Seller, all of the Seller's right, title and interest in
and to the Securities, which shall collectively constitute one hundred percent  
(100%) of the issued and outstanding capital stock of each of the Companies. At 
the Closing, the Seller shall deliver to Purchaser all of the certificates      
representing the Securities together with stock powers separate from the        
certificates duly executed by the Seller in blank and sufficient to convey to   
Purchaser good title to all of the                                              

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Securities free and clear of any and all Encumbrances of any nature whatsoever, 
other than restrictions arising under applicable securities laws or Encumbrances
placed thereon by Persons claiming by, through or under Purchaser.              

2.2 Consideration                                                   

        (a) Subject to adjustment as set forth in Section 2.3, the aggregate
purchase price for the Securities shall be up to Fifty-six Million Five Hundred 
Thousand ($56,500,000) Dollars (the "Purchase Price"), payable by Purchaser to  
the Seller as follows:                                                          

             (i)       $53,000,000 (the "Closing Payment") shall be payable in
                       cash by wire transfer of immediately available funds at
    the Closing (the "Cash at Closing");

            (ii)      $1,500,000 (the "Escrow Amount") shall be deposited by
                        the Purchaser with the Escrow Agent on the Closing Date,
                      which amount shall be held and distributed, subject to
                        the set-offs, if any, authorized herein, pursuant to the
                     terms and provisions hereof and the Escrow Agreement;
and                             

           (iii)     Contingent upon and subject to the achievement of the
                   Gross Profit to the extent set forth in Section 2.5
                       below, up to $2,000,000 (the "Deferred Consideration").

       (b) Notwithstanding anything else contained herein, in the sole and
exclusive discretion of AHI and the Purchaser, up to $15,000,000 of the Closing 
Payment, may be paid by the issuance of duly authorized and nonassessable shares
(the "Consideration Shares") of AHI's common stock, par value $.01 per share    
(the "AHI Common Stock"). For purposes of determining the number of shares of   
AHI Common Stock which shall constitute the Consideration Shares issued as a    
portion of the Closing Payment or the Escrow Amount, the value of AHI Common    
Stock shall be determined based upon the Average Closing Price with respect to  
the Closing Date. For purposes of determining the number of shares of AHI Common
Stock which shall constitute the Consideration Shares issued as a portion of the
Deferred Consideration, the value of AHI Common Stock shall be determined based 
upon the Average Closing Price with respect to the date of issuance of such     
shares of AHI Common Stock.                                                     

2.3 Certain Closing Adjustments and Covenants.                      

    (a) The Purchase Price shall be reduced dollar for dollar to the
extent that the Tangible Net Assets, as set forth in the Closing Date Balance   
Sheet are less than $37,392,000 (the "Minimum Tangible Net Assets Requirement").

(b) For purposes of calculating the Tangible Net Assets, the
Purchaser's independent accountants shall conduct a post-closing audit of the   
Companies promptly after the Closing and within 75 days following the Closing   
Date, the Purchaser shall deliver to the Seller a balance sheet of the Companies
as at the Closing Date, prepared in accordance with GAAP applied on a basis     
consistent with the Financial Statements (the "Closing Date Balance Sheet"). The
Seller and its accountants shall be afforded access to and shall review the     
books and records                                                               

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of the Companies and the workpapers of the Purchaser and its accountants in     
connection with the preparation of the Closing Date Balance Sheet. The Closing  
Date Balance Sheet shall become final and binding upon the parties unless,      
within 30 days following delivery to the Seller (such 30 day period hereinafter 
referred to as the "Review Period"), notice is given by the Seller to the       
Purchaser of the Seller's dispute of the Closing Date Balance Sheet, setting    
forth in reasonable detail the Seller's basis for such objection. If notice of  
dispute is timely given by the Seller, the parties shall work together in good  
faith to resolve such dispute.                                                  

         (c) If the parties are unable to reach agreement within 30 days after
notice of dispute has been received by the Purchaser, the dispute shall be      
referred for resolution to Ernst & Young (the "Determining Accountants") as     
promptly as practicable. The Determining Accountants will make a determination  
as to each item in dispute, which determination will be (i) in writing, (ii)    
furnished to AHI, the Purchaser, and the Seller as promptly as practicable after
the items in dispute have been referred to the Determining Accountants, (iii)   
made in accordance with this Agreement, and (iv) conclusive and binding upon    
each party hereto. Each of Purchaser and the Seller will use reasonable efforts 
to cause the Determining Accountants to render its decision as soon as          
reasonably practicable, including without limitation by promptly complying with 
all reasonable requests by the Determining Accountants for information, books,  
records and similar items.                                                      

      (d) If any post-closing adjustment or other set-off is required or
permitted to be made pursuant hereto, the settlement thereof (the "Post-Closing 
Settlement") shall take place at the offices of Kane Kessler, P.C. at 10:00 a.m.
local time on the fifth business day following the end of the Review Period, or 
in the event such matter has been referred to the Determining Accountants, on   
the fifth business day following the date upon which the written determination  
of the Determining Accountants becomes final and binding upon the parties, or at
such other time and place as the Purchaser and the Seller may mutually agree in 
writing. The Purchaser shall first set-off and deduct from the Escrow Amount the
amount of the Post-Closing Settlement; provided, however, that the Purchaser    
shall first set off and deduct from the Escrow Amount any Consideration Shares  
held by the Escrow Agent pursuant to the Escrow Agreement, such shares to be    
valued for purposes of such set off and deduction at the Average Closing Price  
with respect to the date of release of such Consideration Shares from the Escrow
Agreement. If the Post-Closing Settlement shall exceed the Escrow Amount, the   
amount of such excess shall be a liability of the Seller to Purchaser and shall 
be paid by the Seller to the Purchaser at the Post-Closing Settlement by        
certified or cashier's check. The fees and expenses of each party's respective  
accountants shall be borne by such party. The fees and expenses of the          
Determining Accountants incurred in connection with its review and determination
shall be borne one-half by the Purchaser and one-half by the Seller.            

(e) In order to secure the Post-Closing Settlement, the     
indemnification obligations of the Seller pursuant to Section 5.3(a), 5.6, 5.7  
and 7.13(c), and the obligations of the Seller pursuant to Sections 5.6(d) and  
7.9, the Purchaser shall place the Escrow Amount in escrow with the Escrow Agent
pursuant to the terms of the Escrow Agreement. The Escrow Amount shall be held  
and released pursuant to and in accordance with the terms of the Escrow         
Agreement. The Escrow Agreement shall provide that the Escrow Amount will be    
released upon the later of the Payment of the Post-Closing Settlement pursuant  
to Section 2.3 and the Seller's satisfaction of its obligations set forth in    
Section 7.9.                                                                    

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  (f) The parties agree that for the purposes of calculating the
Purchase Price, preparing the Closing Date Balance Sheet, and calculating the   
Tangible Net Assets, the parties, and the Determining Accountants, shall take   
into account, in addition to the provisions of Sections 2.3(a)-(e), the         
following:                                                                      

            (i)       With respect to any account receivable owed to any one
                  or more of the Companies by the United States Tank
                     Automotive Armored Command ("TACOM"), only the amount
                       that such Company and TACOM agree in writing is due and
                     owing by TACOM to such Company as of the Closing Date
                      shall be included on the Closing Date Balance Sheet as
                  an account receivable. The Purchase Price shall be
                   reduced dollar for dollar by an amount equal to the
                     excess of the amount that such Company asserts is due
                    and owing from TACOM as of the Closing Date over the
                       amount TACOM admits is due and owing to such Company as
                        of the Closing Date (the "TACOM Excess"). Any portion of
                        the TACOM Excess which is paid by TACOM and collected by
                     such Company after the Closing Date shall be promptly
       remitted by such Company to the Seller.

              (ii)      The Purchase Price shall be reduced dollar for dollar by
                the amount of the outstanding receivable, in the
                  approximate amount of $223,000, owed to one of the
                     Companies by Saudi Arabian Prince Sultan (the "Sultan
                   Receivable") to the extent the Sultan Receivable is
                    outstanding on the Closing Date. At the Closing, the
                        Purchaser shall assign to the Seller or its designee the
                    obligation represented by the Sultan Receivable. All
                        payments received by any Company from Prince Sultan with
                        respect to any account receivable shall be applied first
               to any undisputed, unpaid portion of the Sultan
Receivable.                     

             (iii)     The Seller shall use commercially reasonable efforts to
                  resolve the matters listed on Schedule 2.3(f). The
                     Purchase Price shall be reduced dollar for dollar for
              any matters listed on Schedule 2.3(f) that are
unresolved at Closing.          

              (iv)      If, prior to the Closing, the Seller has not settled all
                     outstanding tax claims by Governmental Authorities in
                       Brazil against O'Gara-Hess & Eisenhardt do Brasil LTDA,
                       the purchase price shall be reduced by $750,000, unless
                       O'Gara-Hess & Eisenhardt do Brasil LTDA has obtained an
                        insurance policy in a form reasonably acceptable to AHI,
                  the premium for which shall be paid by the Seller,
                   insuring such tax claims in an amount not less than
                       $3,000,000. To the extent such taxes and any associated
                     costs and expenses are finally resolved for less than
                        $750,000, the difference between $750,000 and the amount
                      of such final resolution shall be promptly remitted to
the Seller.                     

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              (v)       The Purchase Price shall be reduced dollar for dollar to
                       the extent that the Taxes indicated on Schedule 4.26 as
                    being contested in good faith exceed $100,000 (other
                     than Taxes set forth on Schedule 2.3(f) and the Taxes
                      for which indemnification is provided in Section 5.7);
                     provided, however, that if any amount being contested
               which results in a Purchase Price adjustment is
                   determined in a final, non-appealable decision of a
                       Governmental Authority not to be owed by the Companies,
                     such amount shall be promptly remitted to the Seller.

2.4 [Intentionally Omitted]                                         

2.5 Calculation of Deferred Consideration                           

        (a) If the Companies' Gross Profit (as defined below) shall equal or
exceed $27,832,000, then the Deferred Consideration shall equal $2,000,000. If  
the Companies' Gross Profit shall be less than $27,832,000 but shall equal or   
exceed $26,400,000, then the Deferred Consideration shall be $1,000,000. If the 
Companies' Gross Profit shall be less than $26,400,000, then there shall be no  
Deferred Consideration. Any Deferred Consideration to be paid to the Seller     
shall be reduced dollar for dollar by the amount of any Uncollected Receivables,
but shall not be reduced to less than $0. All Uncollected Receivables credited  
against the Deferred Consideration shall be transferred to the Seller or its    
designee.                                                                       

(b) "Gross Profit", for purposes of calculating Deferred    
Consideration, shall mean the excess of (i) the combined revenue of the         
Companies for the twelve month period ended December 31, 2001 over (ii) combined
costs of sales of the Companies for such twelve month period, all as determined 
in accordance with GAAP consistently applied with prior periods, reduced by the 
amount of (x) any one-time, non-recurring costs or operating expenses which     
arose from or are related to prior periods, and (y) the amount of (i) any       
accounts receivable, after giving effect to corresponding reserves set forth on 
the Closing Date Balance Sheet, which are uncollected as of the date of         
calculation and (ii) any accounts receivable included within the costs in excess
of billings account set forth on the Closing Date Balance Sheet which are       
uncollected as of the date of calculation ("Uncollected Receivables") and shall 
be calculated on a combined, stand-alone basis for the Companies and shall      
include a reasonable allocation of overhead by AHI to the Companies or          
reasonable allocation of overhead by AHI which is reasonably related to the     
generation of the Gross Profit. For purposes of calculating Gross Profit, the   
property and equipment purchased by one of the Companies from Longline Leasing, 
Incorporated shall be amortized over one year.                                  

          (c) The Purchaser shall use reasonable efforts to calculate the amount
of the Gross Profit and the amount, if any, of Deferred Consideration payable to
the Seller hereunder as soon as reasonably practicable, but in no event later   
than May 15, 2002. The Deferred Consideration shall be paid within 15 days after
the determination of the Gross Profit.                                          

  2.6 Resale of Consideration Shares. The Seller shall sell or otherwise
dispose of the Consideration Shares solely in accordance with the procedures set
forth on Schedule 2.6. The obligations of AHI and the Purchaser under Schedule  
2.6 are absolute and unconditional, except                                      

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as expressly set forth on Schedule 2.6, and neither AHI nor the Purchaser shall 
have any right of set off, counterclaim, deduction or other diminution of any   
kind whatsoever with respect to any claim for indemnification under this        
Agreement or otherwise with respect to such obligations.                        

   2.7 Section 338(h)(10) and Section 338(g) Elections. At the election of
the Purchasers, the Seller and the Purchaser agree to make irrevocable, timely, 
and effective joint elections provided under Section 338(h)(10) of the Code     
(including under any comparable statutes in any other jurisdiction) with respect
to all acquired U.S. Companies and Companies Subsidiaries and to make           
irrevocable, timely, and effective elections under Section 338(g) of the Code   
for the non U.S. Companies and the non U.S. Company Subsidiaries. Such elections
(the "Tax Elections") shall be in accordance with the Code and the regulations  
promulgated thereunder and other applicable laws. Based on the actual date of   
Closing, the Purchaser shall notify the Seller as to the exact date by which the
Tax Elections must be made. In the event that the Purchaser elects to make the  
Tax Elections, the Purchaser shall give timely notice thereof to the Seller, and
the Seller and such Companies shall each cooperate with the Purchaser in order  
to facilitate the Tax Elections, and the Purchaser, the Seller, and the         
Companies shall jointly file an IRS Form 8023 ("Tax Election Form") on a timely 
basis. Prior to Closing, Purchaser and Seller shall use their best efforts to   
agree on the calculations which shall be used concerning (i) the assets deemed  
purchased pursuant to the Section 338(h)(10) or 338(g) Tax Elections contained  
in this Section 2.7, (ii) the computation of the Modified Aggregate Deemed Sale 
Price (as defined under applicable Treasury Regulations) ("MADSP"), and (iii)   
the allocation of such MADSP among such assets. The Seller shall be responsible 
for all Taxes attributable to the Section 338(h)(10) or 338(g) Tax Elections    
(whether payable on a consolidated return including, or separate returns of,    
such Companies) other than those taxes described in Section 5.6(b). The Seller  
shall indemnify and pay AHI and the Purchaser for the loss of any Tax Benefits  
of AHI and reasonable fees and expenses of the Purchaser as a result of a       
failure or refusal of the Seller to make the Section 338(h)(10) or 338(g) Tax   
Elections provided Purchaser shall have given adequate notice to Seller pursuant
to this Section 2.7.                                                            

ARTICLE III.
 REPRESENTATIONS AND WARRANTIES OF PURCHASER

In order to induce the Seller to enter into this Agreement and to   
consummate the transactions contemplated hereby, AHI and the Purchaser, jointly 
and severally, make the representations and warranties set forth below to the   
Seller.                                                                         

3.1 Organization; Standing and Power. Each of AHI and Purchaser is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. AHI and the Purchaser have all requisite right, power 
and authority to execute, deliver and perform this Agreement and the other      
agreements and documents contemplated hereby to be executed by them and to      
consummate the transactions contemplated hereby and thereby.                    

      3.2 Authorization; Enforceability. The execution, delivery and performance
of this Agreement and all other agreements and documents to be executed by AHI  
or Purchaser in connection with the transactions contemplated hereby and the    
consummation by AHI and Purchaser of the transactions contemplated hereby and   
thereby have been and will be duly authorized by all requisite corporate action 
on the part of each of AHI and Purchaser. This                                  

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Agreement has been, and all other agreements and documents contemplated hereby  
to be executed and delivered by AHI and Purchaser, when so executed and         
delivered, will have been, duly executed and delivered by AHI and Purchaser and 
constitute or will constitute the legal, valid and binding obligations of AHI or
Purchaser, as the case may be, enforceable against them in accordance with their
respective terms, except to the extent that such enforcement is limited by      
bankruptcy, insolvency, reorganization or other laws relating to or affecting   
the enforcement of creditors' rights generally and by general principles of     
equity.                                                                         

    3.3 No Violation or Conflict. The execution, delivery and performance of
this Agreement and the other agreements and documents contemplated hereby to be 
executed by AHI or Purchaser and the consummation by AHI and Purchaser of the   
transactions contemplated hereby and thereby do not violate or conflict with any
(a) Applicable Law or any writ, order or decree of any court or Governmental    
Authority, the violation of which would interfere in any material respect with  
AHI's or Purchaser's ability to consummate the transactions contemplated hereby,
(b) any provision of AHI's or Purchaser's respective certificate of             
incorporation or bylaws, or (c) any instrument or material agreement to which   
AHI or the Purchaser is a party or by which AHI or the Purchaser or their       
respective properties is bound.                                                 

3.4 Consent of Governmental Authorities. No consent, approval or    
authorization of, or registration, qualification or filing with any Governmental
Authority is required to be made by AHI or Purchaser in connection with the     
execution, delivery or performance by AHI and Purchaser of this Agreement or the
other agreements or documents contemplated hereby to be executed and delivered  
by AHI and the Purchaser, or the consummation by AHI and Purchaser of the       
transactions contemplated hereby or thereby, other than (a) as required by the  
Securities Act with respect to the issuance of the Consideration Shares and (b) 
any filing and approval required under the HSR Act or any Non-U.S. Anti-Trust   
Law.                                                                            

3.5 Brokers. Except for Bear, Stearns & Co. Inc. and as set forth on
Schedule 3.5 hereto, AHI and Purchaser have not employed any financial advisor, 
broker or finder and have not incurred and will not incur any broker's,         
finder's, investment banking or similar fees, commissions or expenses, in       
connection with the transactions contemplated by this Agreement. AHI and        
Purchaser shall be responsible for payment of the commissions and fees of Bear, 
Stearns & Co. Inc. and any other Person set forth on Schedule 3.5 hereto.       

3.6 Public Documents; Compliance. The forms, reports, schedules,    
registration statements, and documents filed by AHI with the SEC (i) complied as
to form in all material respects with the requirements of the Securities Act or 
the Exchange Act, as the case may be, each as in effect on the date so filed or 
amended, and (ii) did not contain any untrue statement of a material fact or    
omit to state any material fact required to be stated therein or necessary in   
order to make the statements therein, in light of the circumstances under which 
they were made, not misleading (in each case as of the respective dates that    
they were filed with the SEC, or if amended or superseded by a filing prior to  
the date of this Agreement, then on the date of such filing). All forms,        
reports, schedules, registration statements and documents required to be filed  
by AHI with the SEC under the Securities Act and the Exchange Act have been     
filed on a timely basis for the last 12 months and AHI is eligible to file a    
registration statement on Form S-3 under the Securities Act. Since the date of  
the latest financial statements of AHI included in any report filed by AHI with 
the SEC, there has been no material adverse change in the condition (financial  

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or otherwise), results of operations, assets, liabilities or business of AHI and
its Subsidiaries, taken as a whole. AHI has previously delivered to the Seller  
copies of AHI's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and  
Current Reports on Form 8-K filed by it with the SEC since January 1, 2000 and  
AHI's Registration Statement on Form S-3, Registration No. 333-75053.           

    3.7 Consideration Shares. Any Consideration Shares to be issued pursuant
to Section 2.2(b) have been, or upon issuance will be, duly authorized, validly 
issued, fully paid and non-assessable.                                          

     3.8 Registration Statement. The Registration Statement, at the time it is
filed and at the time it is declared effective, will comply as to form in all   
material respects with the requirement of the Securities Act and will not       
contain any untrue statement of a material fact or omit to state any material   
fact required to be stated therein or necessary in order to make statements     
therein, in light of the circumstances under which they are made, not           
misleading.                                                                     

      3.9 Litigation. There are no actions, suits, investigations, arbitrations,
claims or proceedings pending or, to the knowledge of AHI or Purchaser,         
threatened before any court or by or before any Governmental Authority or       
arbitrator against AHI or the Purchaser, or any of their respective directors or
officers, as such, relating to the transactions contemplated by this Agreement  
or that might prevent or delay the consummation of such transaction.            

ARTICLE IV. 
REPRESENTATIONS AND WARRANTIES OF THE SELLER AND THE COMPANIES

    In order to induce Purchaser and AHI to enter into this Agreement and to
consummate the transactions contemplated hereby, the Seller and each of the     
Companies jointly and severally, make the representations and warranties set    
forth below to Purchaser and to AHI. For purposes of this Article IV, all       
references to the Companies shall, unless the context clearly indicates         
otherwise, be deemed to include each Company and each of their respective       
Company Subsidiaries.                                                           

4.1 Organization                                                    

  (a) The Seller and each of the Companies is a corporation duly
organized, validly existing and in good standing (or applicable concept in its  
jurisdiction of incorporation) under the laws of the jurisdiction of its        
incorporation or formation. Each of the Companies, other than the Company       
Subsidiaries, is duly qualified to transact business as a foreign corporation in
all jurisdictions where the ownership or leasing of its properties or the       
conduct of its business requires such qualification, except where the failure to
be so qualified is not reasonably likely to have a Material Adverse Effect. Each
jurisdiction in which any of the Companies, other than the Company Subsidiaries,
is so qualified is listed on Schedule 4.1(a) hereto. Each of the Companies,     
other than the Company Subsidiaries, has the requisite power and authority to   
(i) own or lease and operate its properties and (ii) conduct its business as    
presently conducted.                                                            

      (b) Set forth on Schedule 4.1(b) hereto is a complete and accurate
list of Persons with respect to which any of the Companies beneficially owns,   
directly or indirectly, any of the outstanding stock or other ownership         
interests of such Person (the "Company                                          

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Subsidiaries") and such Company's percentage ownership of each such Company     
Subsidiary. Schedule 4.1(b) lists each third-party which beneficially owns,     
directly or indirectly, any of the outstanding stock or other ownership         
interests of any Company Subsidiary and such third-party's percentage ownership 
therein. Except as set forth on Schedule 4.1(b), there is no other Person with  
respect to which: (i) any Company beneficially owns, directly or indirectly, any
outstanding stock or other ownership interests of such Person; (ii) any Company 
may be deemed to be in control because of factors or relationships other than   
the quantity of stock or other interests owned; (iii) any Company may be liable 
under any circumstances for the payment of additional amounts with respect to   
its interest, whether in the form of assessments, capital calls, installment    
payments, general partner liability or otherwise; or (iv) any Company's         
investment is accounted for by the equity method. Other than Seller, the        
Companies with respect to the Company Subsidiaries, and the Company Subsidiaries
with respect to their Subsidiaries, no Person controls any of the Companies or  
any of the Company Subsidiaries, whether by contract or otherwise. Each Company 
Subsidiary is duly organized, validly existing and in good standing under the   
laws of its jurisdiction of formation, which jurisdictions are set forth on     
Schedule 4.1(b). Each Company Subsidiary is duly qualified to transact business 
as a foreign corporation in all jurisdictions where the ownership or leasing of 
its properties or the conduct of its business requires such qualification,      
except where the failure to be so qualified is not reasonably likely to have a  
Material Adverse Effect. Each jurisdiction in which a Company Subsidiary is so  
qualified is listed on Schedule 4.1(b). Each Company Subsidiary has the         
requisite power and authority to (i) own or lease and operate its properties and
(ii) conduct its business as presently conducted.                               

  4.2 Authorization; Enforceability. The Seller and each Company has all
requisite corporate power and corporate authority to execute, deliver and       
perform this Agreement and the other agreements and documents contemplated      
hereby to be executed by them and to consummate the transactions contemplated   
hereby and thereby. This Agreement and all other documents to be executed and   
delivered by the Seller or any of the Companies, as the case may be, in         
connection with the transactions contemplated hereby have been and will be duly 
authorized by all requisite corporate action on the part of the Seller or any of
the Companies, as the case may be. This Agreement has been, and all other       
agreements and documents contemplated hereby to be executed and delivered by the
Seller or any of the Companies will have been, duly executed and delivered and  
constitute or will constitute the legal, valid and binding obligations of the   
Seller or the Companies, as the case may be, enforceable against them in        
accordance with their respective terms, except to the extent that such          
enforcement is limited by bankruptcy, insolvency, reorganization or other laws  
relating to or affecting the enforcement of creditors' rights generally and by  
general principals of equity.                                                   

    4.3 No Violation or Conflict. The execution, delivery and performance of
this Agreement by the Seller and each of the Companies and the consummation by  
the Seller and each of the Companies of the transactions contemplated hereby:   
(a) do not violate or conflict with any provision of the Seller's or any        
Company's certificate or articles of incorporation or bylaws or code of         
regulations, as the case may be; (b) do not violate or conflict with any        
provision of any Applicable Law or any writ, order or decree of any court or    
Governmental Authority other than a violation or a conflict which would not have
a Material Adverse Effect; and (c) except as set forth on Schedule 4.3 hereto,  
do not, with or without the passage of time or the giving of notice, result in  
the material breach of, or constitute a material default, give rise to a        
material right of termination, cancellation or acceleration of performance or   
loss of material                                                                

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benefit, or result in the creation of any material Encumbrance upon any material
property or assets of any of the Companies pursuant to any Material Agreement to
which the Seller or any of the Companies is a party or by which the Seller or   
any of the Companies or their respective properties is bound or affected. Except
as set forth on Schedule 4.3, the consummation of the transactions contemplated 
hereby will not require the notification or consent of any third party to any   
Material Agreement.                                                             

     4.4 Consents of Governmental Authorities. Except as set forth on Schedule
4.4, no consent, approval or authorization of, or registration, qualification or
filing with any Governmental Authority, is required to be made by the Seller or 
any of the Companies in connection with the execution, delivery or performance  
of this Agreement by the Seller or any of the Companies or the consummation by  
the Seller or any of the Companies of the transactions contemplated hereby,     
other than any filing and approval required under the HSR Act or Non-U.S.       
Anti-Trust Law.                                                                 

      4.5 Conduct of Business. Except as disclosed on Schedule 4.5 hereto, since
December 31, 2000, each of the Companies has conducted its businesses in the    
ordinary and usual course consistent with past practices and there has not      
occurred any Material Adverse Change. Without limiting the generality of the    
foregoing, except as disclosed on Schedule 4.5, since December 31, 2000, none of
the Companies has: (a) amended its certificate or articles of incorporation or  
bylaws or code of regulations, as the case may be; (b) issued, sold or          
authorized for issuance or sale, shares of any class of its securities          
(including, but not limited to, by way of stock split or dividend) or any       
subscriptions, options, warrants, rights or convertible securities or entered   
into any agreements or commitments of any character obligating it to issue,     
sell, redeem, purchase, or register any such securities; (c) redeemed, purchased
or otherwise acquired, directly or indirectly, any shares of its capital stock  
or any option, warrant or other right to purchase or acquire any such shares;   
(d) declared or paid any dividend or other distribution (whether in cash, stock 
or other property) with respect to its capital stock other than dividends or    
other distributions among the Companies and the weekly payments by OHEAC to the 
Seller as set forth on Schedule 4.5; (e) suffered any material damage,          
destruction or loss, whether or not covered by insurance, (f) sold, leased, or  
disposed of any material assets or property of such Company other than in the   
ordinary course of business; (g) granted or made any mortgage or pledge or      
subjected itself or any of its properties or assets to any Encumbrance of any   
kind, except liens for Taxes not currently due; (h) made or committed to make   
any capital expenditures in excess of $50,000 in any single case or in excess of
an aggregate of $400,000 through the date hereof; (i) become subject to any     
Guaranty; (j) materially changed any accounting method used by such Company or  
been affected by any material change in any accounting method used by the       
Seller; (k) granted any increase in the compensation payable or to become       
payable to directors, officers, employees (including, without limitation, any   
such increase pursuant to any bonus, pension, profit-sharing or other plan or   
commitment), except, with respect to non-officer employees, customary annual    
increases consistent with past practices; (l) materially amended or terminated  
any existing Material Agreement or received written notice or, to the Seller's  
knowledge, oral notice of any such amendment or termination; (m) experienced any
strike, material work stoppage or material slowdown; (n) received written notice
or, to the Seller's knowledge, oral notice of any Material Adverse Change in its
relationship with any financial institution, customer or supplier with which it 
currently does business, or (o)                                                 

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entered into any agreement to do any the foregoing. SARL Essonne Securite has   
conducted no business since its inception.                                      

4.6 Litigation; Disputes. Except as set forth on Schedule 4.6 and as
described in Section 5.7, there are no actions, suits, investigations,          
arbitrations, claims or proceedings ("Litigation") pending or, to the knowledge 
of the Seller or any of the Companies, threatened before any court or by or     
before any Governmental Authority, (a) against (as plaintiff or defendant) any  
of the Companies or (b) against (as plaintiff or defendant) the Seller relating 
to the Securities or the transactions contemplated by this Agreement other than 
Litigation which is not reasonably likely to have a Material Adverse Effect. To 
the Seller's knowledge Schedule 4.6 together with Section 5.7 sets forth a      
complete and accurate list and description of any material Litigation commenced 
against any of the Companies in the last three (3) years. To the knowledge of   
the Seller no material dispute or claim exists between any of the Companies and 
any of their customers, suppliers, or distributors that could reasonably be     
expected to have a Material Adverse Effect.                                     

4.7 Brokers. Except as set forth on Schedule 4.7 hereto, neither the
Seller nor the Companies has employed any financial advisor, broker or finder,  
and neither of them has incurred or will incur any other broker's, finder's,    
investment banking or similar fees, commissions or expenses in connection with  
the transactions contemplated by this Agreement. The Seller shall be solely     
responsible for all fees, commissions, and expenses of any Person set forth on  
Schedule 4.7 hereto incurred in connection with the transactions contemplated by
this Agreement.                                                                 

      4.8 Compliance. Each of the Companies is in compliance with all Applicable
Law including, but not limited to, those relating to (a) the development,       
manufacture, distribution, marketing and sale of products and services and (b)  
the bidding for contracts by and the conduct of business by federal or state    
contractors, except where the failure to be in compliance would not have a      
Material Adverse Effect. Except as set forth on Schedule 4.8, none of the       
Companies is subject to any material judicial, governmental or administrative   
order, judgment or decree and the Seller is not subject to any material         
judicial, governmental or administrative order, judgment or decree. Attached    
hereto as Schedule 4.8 are true and correct copies of all reports of material   
inspections of each of the Company's business and properties which occurred     
during the past three (3) years through the date hereof, under Applicable Laws  
which resulted in the imposition of a material fine, penalty, or other material 
restrictions. Neither the Seller nor any of the Companies has received written  
notice, or has knowledge of any oral notice, of any material violation (or any  
investigation, inspection, audit, or other proceeding by any Governmental       
Authority involving an allegation of any material violation) of any material    
Applicable Law by or affecting any of the Companies, and to the knowledge of the
Seller and each of the Companies, no investigation, inspection, audit, or other 
proceeding by any Governmental Authority involving an allegation of material    
violation of any material Applicable Law is threatened or contemplated.         

   4.9 Charter, Bylaws, Code of Regulations and Corporate Records. A true,
correct and complete copy of (a) the certificate or articles of incorporation of
the Seller and each of the Companies, as amended and in effect on the date      
hereof, (b) the bylaws or code of regulations of the Seller and each of the     
Companies, as amended and in effect on the date hereof, and, if any of          

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the Company Subsidiaries is not a corporation, the organizational and           
operational documents of such Company Subsidiary, and (c) the stock ledgers and 
stock transfer records of each of the Companies has previously been made        
available to the Purchaser. The minute books of each of the Companies have      
previously been made available to the Purchaser. Such minute books contain      
complete and accurate, in all material respects, records of all meetings and    
other corporate actions of the board of directors, committees of the board of   
directors, incorporators and shareholders of each of the Companies from the date
of its incorporation to the date hereof. All such meetings were duly called and 
held, and a quorum was present and acting throughout each such meeting, except  
as disclosed in such minute books. Such stock ledgers and stock transfer records
reflect all issuances and registrations of transfer of all shares of capital    
stock of the Companies, and certificates representing all canceled shares of    
capital stock have been returned to the stock ledger, except as to which the    
relevant Company has received a lost certificate affidavit from the registered  
owner (or their lawful representative) of the shares evidenced thereby.         

4.10 Capitalization of the Companies                                

         (a) O'Gara-Hess & Eisenhardt Armoring Company. The authorized capital
stock OHEAC consists of (i) 100,000 shares of common stock, no par value, of    
which 13,625 shares are issued and outstanding and owned by the Seller and (ii) 
no shares of preferred stock (such outstanding common stock, the "Outstanding   
OHEAC Capital Stock"). All shares of the Outstanding OHEAC Capital Stock have   
been duly authorized, are validly issued and outstanding, and are fully paid and
nonassessable. No securities issued by OHEAC from the date of its incorporation 
to the date hereof were issued in violation of any statutory or common law      
preemptive rights. There are no dividends which have accrued or been declared   
but are unpaid on the Outstanding OHEAC Capital Stock. All Taxes required to be 
paid in connection with the issuance and any transfers of the Outstanding OHEAC 
Capital Stock have been paid. All permits or authorizations required to be      
obtained from or registrations required to be effected with any Governmental    
Authority in connection with any and all issuances of securities of OHEAC from  
the date of the its incorporation to the date hereof have been obtained or      
effected, and all securities of OHEAC have been issued in accordance with the   
provisions of all applicable Federal and state securities or other laws.        

          (b) The O'Gara Company. The authorized capital stock of O'Gara Company
consists of (i) 15,000,000 shares of common stock, par value $0.01 per share, of
which 100 shares are issued and outstanding and owned by the Seller, and (ii)   
100,000 shares of preferred stock par value $0.01 per share, of which 0 shares  
are issued and outstanding and owned by the Seller (such outstanding common     
stock and outstanding preferred stock, the "Outstanding O'Gara Company Capital  
Stock"). All shares of the Outstanding O'Gara Company Capital Stock have been   
duly authorized, are validly issued and outstanding, and are fully paid and     
nonassessable. No securities issued by O'Gara Company from the date of its      
incorporation to the date hereof were issued in violation of any statutory or   
common law preemptive rights. There are no dividends which have accrued or been 
declared but are unpaid on the Outstanding O'Gara Company Capital Stock. All    
Taxes required to be paid in connection with the issuance and any transfers of  
the Outstanding O'Gara Company Capital Stock have been paid. All permits or     
authorizations required to be obtained from or registrations required to be     
effected with any Governmental Authority in connection with any and all         
issuances of securities of O'Gara                                               

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Company from the date of the its incorporation to the date hereof have been     
obtained or effected, and all securities of O'Gara Company have been issued in  
accordance with the provisions of all applicable Federal and state securities or
other laws.                                                                     

         (c) O'Gara Security Associates, Inc.. The authorized capital stock of
OSA consists of (i) 850 shares of common stock, no par value, of which 100      
shares are issued and outstanding and owned by the Seller and (ii) no shares of 
preferred stock (such outstanding common stock, the "Outstanding OSA Capital    
Stock"). All shares of the Outstanding OSA Capital Stock have been duly         
authorized, are validly issued and outstanding, and are fully paid and          
nonassessable. No securities issued by OSA from the date of its incorporation to
the date hereof were issued in violation of any statutory or common law         
preemptive rights. There are no dividends which have accrued or been declared   
but are unpaid on the Outstanding OSA Capital Stock. All Taxes required to be   
paid in connection with the issuance and any transfers of the Outstanding OSA   
Capital Stock have been paid. All permits or authorizations required to be      
obtained from or registrations required to be effected with any Governmental    
Authority in connection with any and all issuances of securities of OSA from the
date of the its incorporation to the date hereof have been obtained or effected,
and all securities of OSA have been issued in accordance with the provisions of 
all applicable Federal and state securities or other laws.                      

         (d) Company Subsidiaries. The authorized capital stock of each of the
Company Subsidiaries is set forth on Schedule 4.10 hereto. All shares of the    
outstanding capital stock of the Company Subsidiaries have been duly authorized,
are validly issued and outstanding, and are fully paid and nonassessable. No    
securities issued by any of the Company Subsidiaries from the date of its       
incorporation to the date hereof were issued in violation of any statutory or   
common law preemptive rights. There are no dividends which have accrued or been 
declared but are unpaid on any of such shares of capital stock. All Taxes       
required to be paid in connection with the issuance and any transfers of such   
shares of capital stock have been paid. All permits or authorizations required  
to be obtained from or registrations required to be effected with any           
Governmental Authority in connection with any and all issuances of securities of
any of the Company Subsidiaries from the date of its incorporation to the date  
hereof have been obtained or effected, and all securities of the Company        
Subsidiaries have been issued in accordance with the provisions of all          
applicable Federal and state securities or other laws.                          

 4.11 Rights, Warrants, Options. Except as set forth on Schedule 4.11,
there are no outstanding (a) securities or instruments convertible into or      
exercisable for any of the capital stock or other equity interests of any of the
Companies; (b) options, warrants, subscriptions or other rights to acquire      
capital stock or other equity interests of any of the Companies; or (c)         
commitments, agreements or understandings of any kind, including employee       
benefit arrangements, relating to the issuance or repurchase by any of the      
Companies of any capital stock or other equity interests of such Company, or any
instruments convertible or exercisable for any such securities or any options,  
warrants or rights to acquire such securities.                                  

    4.12 Financial Statements. Attached hereto as Schedule 4.12 are true and
complete copies of the Financial Statements. The Financial Statements (a) have  
been prepared in accordance with the books of account and records of the        
Companies; (b) fairly present in all material respects the Companies' financial 
condition and the results of its operations and cash flows at the dates and for 
the periods specified in those statements; and (c) have been prepared in        

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accordance with GAAP consistently applied with prior periods; provided, however,
that (i) the unaudited balance sheet and the unaudited statement of income of   
the Companies as of and for the fiscal year ended December 31, 2000 do not      
contain inter-Company eliminations or footnotes as required by GAAP and (ii) the
Financial Statements for the fiscal years ended December 31, 1998 and December  
31, 1999 (a) include the accounts of Securify, Inc., which will not be a        
Subsidiary of the Companies after the Closing, (b) include corporate debt of the
Seller which will not be an obligation of the Companies after the Closing, and  
(c) reflect allocations of corporate overhead by the Seller to the Companies.   

    4.13 Absence of Undisclosed Liabilities. As of the Closing Date, none of
the Companies shall have any liability for borrowed money other than long term  
lease or mortgage obligations with respect to which the assets securing such    
obligations are included in the Closing Date Balance Sheet. As of December 31,  
2000, none of the Companies had any material direct or indirect indebtedness,   
liability, claim, loss, damage, deficiency, obligation or responsibility, known 
or unknown, fixed or unfixed, choate or inchoate, liquidated or unliquidated,   
secured or unsecured, accrued, absolute, contingent or otherwise, including,    
without limitation, liabilities on account of Taxes, other governmental charges 
or lawsuits brought ("Liabilities"), except for Liabilities (a) adequately      
reflected in the Financial Statements or (b) that would not have been required  
under GAAP to be reflected in the Financial Statements. Since December 31, 2000,
the Companies have only incurred Liabilities in the ordinary course of business 
consistent with past practice or as otherwise set forth on Schedule 4.13, except
for Liabilities which are not material in the aggregate.                        

   4.14 Title to Securities. The Seller is the record and beneficial owner
of, and has good and marketable title to, the Securities listed opposite the    
Seller's name on Schedule 4.14, and, except as set forth on Schedule 4.14 such  
Securities are owned free and clear of any Encumbrances and claims whatsoever,  
including, without limitation, claims or rights under any voting trust          
agreements, shareholder agreements or other agreements. The Securities          
constitute all of the issued and outstanding capital stock of the Companies (for
purposes of this sentence, "Companies" shall not include the Company            
Subsidiaries.) At the Closing, the Seller will transfer and convey, and         
Purchaser will acquire, good title to the Securities, free and clear of all     
Encumbrances and claims whatsoever, other than Encumbrances placed thereon by   
Persons claiming by, through, or under AHI, the Purchaser, or any of their      
Affiliates. Except as set forth on Schedule 4.14, upon the transfer of the      
Securities to Purchaser, the Companies will posses ownership of the entire      
business necessary to operate the Companies as a going concern as such business 
is presently being conducted and there will be no material assets of the Seller 
not owned by the Companies which are necessary to conduct the business of the   
Companies as presently conducted. Each of the Companies and the Company         
Subsidiaries is the record and beneficial owner of, and has good and marketable 
title to, the securities of the Company Subsidiaries listed opposite such       
Company's or Company Subsidiary's name on Schedule 4.14, and, such securities   
are owned free and clear of any Encumbrances and claims whatsoever, including,  
without limitation, claims or rights under any voting trust agreements,         
shareholder agreements or other agreements, except as set forth on Schedule     
4.14.                                                                           

      4.15 Title to and Condition of Personal Property. Schedule 4.15 sets forth
the list of plant, machinery, equipment, furniture, leasehold improvements,     
fixtures, vehicles, structures, any related capitalized items and other tangible
property used in the business of the Companies                                  

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in the form provided to the Seller's independent accountants in connection with 
the preparation of the Seller's financial statements for the year ended December
31, 2000 ("Tangible Property"). The Companies have good title to, or in the case
of leased or licensed property, has a valid leasehold or license interest in,   
each material item of Tangible Property, free and clear of any options or       
Encumbrances whatsoever, except (i) Permitted Encumbrances, (ii) as set forth in
Schedule 4.15 hereto, (iii) specifically identified as such in the Financial    
Statements, and (iv) items sold or disposed of in the ordinary course of        
business after December 31, 2000. Except as set forth in Schedule 4.15, all     
material Tangible Property owned by the Companies or used by the Companies on   
the date hereof in the operation of its business is in good operating condition 
and in a good state of maintenance and repair and is adequate for the business  
as conducted by the Companies. Other than leased or licensed assets, or other   
assets for which the Company has a valid right to use, and except as set forth  
on Schedule 4.15, there are no material assets owned by any third party which   
are used in the operation of the business of the Companies as conducted by the  
Companies.                                                                      

4.16 Real Property                                                  

  (a) None of the Companies owns any fee simple interest in real
property other than as set forth on Schedule 4.16. None of the Companies leases 
or subleases (as lessee or sublessee) any real property other than as set forth 
on Schedule 4.16. Schedule 4.16 sets forth the street address of each parcel of 
real property owned by each of the Companies (the "Owned Property") or leased or
subleased (as lessee or sublessee) by each of the Companies (the "Leased        
Property" and, together with the Owned Property, the "Real Property"). Attached 
hereto as Schedule 4.16 is a list of all of the lease and sublease agreements   
and all other instruments granting such leasehold interests, rights, options, or
other interests, as amended to date (the "Leases") relating to the Leased       
Property. A true, complete, and correct copy of each of the Leases has          
previously been made available to the Purchaser. The Leases are valid, binding  
and in full force and effect, except to the extent that enforcement is limited  
by bankruptcy, insolvency, reorganization, or other laws resulting to or        
affecting the enforcement of creditor's rights generally and by general         
principles of equity, all rent and other sums and charges payable thereunder are
current, no notice of default or termination under any of the Leases is         
outstanding, no termination event or condition or uncured default on the part of
any of the Companies or, to the knowledge of the Seller or any of the Companies,
on the part of the landlord or sublandlord, as the case may be, thereunder,     
exists under the Leases, and no event has occurred and no condition exists      
which, with the giving of notice or the lapse of time or both, would constitute 
such a default or termination event or condition. In the event that any of the  
Leases is a sublease, the relevant Company, as sublessee or sublessor, as the   
case may be, has obtained the required consent of the prime landlord to such    
sublease, and such prime lease is in full force and effect, there are no        
outstanding uncured notices of default or termination, and no right of such     
Company in any such sublease conflicts with such prime lease. There are no      
subleases, licenses or other agreements granting to any person other than the   
relevant Company any right to the possession, use, occupancy or enjoyment of the
premises demised by the Leases. All of the premises are used in the conduct of  
the Companies' business.                                                        

       (b) The Companies have good title in fee simple or otherwise to the
Owned Property and good leasehold title to the Leased Property and to all       
plants, buildings, and improvements thereon, free and clear of any mortgages,   
imperfections of title, encroachments,                                          

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easements, rights-of-way, squatters' rights, covenants, conditions,             
restrictions, or Encumbrances, except Permitted Encumbrances and except as      
described on Schedule 4.16. The Companies enjoy a peaceful and undisturbed      
possession of the Real Property. No Person other than the Companies has any     
right to use or occupy any part of the Real Property.                           

         (c) Except as set forth on Schedule 4.16, all improvements located on
the Real Property are in a state of good maintenance and repair and in a        
condition adequate and reasonably suitable for the conduct therein of the       
business as conducted by the Companies. Except as set forth on Schedule 4.16,   
the heating, ventilation, air conditioning, plumbing and electrical systems at  
the Real Property are in good working order and repair. The Companies have not  
experienced any material interruption in such services provided to any of the   
premises located on the Real Property within the last year. To the knowledge of 
the Seller or any of the Companies, no landlord under the Leases has any plans  
to make any material alterations to any of the Leased Property, the construction
of which would interfere in any material respect with the use of any material   
portion of the Leased Property. To the knowledge of the Seller or any of the    
Companies, no landlord under the Leases has any plans to make any material      
alterations to any of the buildings located on any Leased Property, the costs of
which alterations would be borne in any part by a tenant under the applicable   
Lease.                                                                          

          (d) All required material permits, licenses, franchises, approvals and
authorizations (collectively, the "Real Property Permits") of (i) all           
Governmental Authorities having jurisdiction over each Real Property and (ii)   
from all insurance companies and fire rating and other similar boards and       
organizations having jurisdiction over such Real Property (collectively, the    
"Insurance Organizations"), are set forth on Schedule 4.16 and have been issued 
to the Companies to enable each Real Property to be lawfully occupied and used  
for all of the purposes for which they are currently occupied and used and are, 
as of the date hereof, in full force and effect in all material respects.       
Neither the Seller nor any of the Companies has received any written notice, or 
has knowledge of any oral notice, from any Governmental Authority having        
jurisdiction over any Real Property or from any Insurance Organization          
threatening a suspension, revocation, modification or cancellation of any Real  
Property Permit or of any insurance policies, and the Seller has no knowledge of
a violation of a material Real Property Permit.                                 

        (e) Except as set forth on Schedule 4.16, neither the Seller nor any
of the Companies has received any written notice nor have they any knowledge of 
any pending or threatened condemnation or eminent domain proceeding with respect
to or affecting any Real Property or any part thereof.                          

4.17 Insurance. Schedule 4.17 sets forth a true and complete in all 
material respects list of all insurance policies providing insurance coverage of
any nature to the Companies. The Companies have previously provided the         
Purchaser with true and complete copies in all material respects of all of such 
insurance policies, as amended to the date hereof. Such policies provide        
adequate and customary coverage for the business in which the Companies are     
engaged and are sufficient for compliance in all material respects by the       
Companies with all requirements of Applicable Law and all Material Agreements to
which any of the Companies is a party or by which any of the material assets of 
any of the Companies are bound. All of such policies are in full force and      
effect and are valid and enforceable in accordance with their terms, and each of
the                                                                             

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Companies has complied in all material respects with all terms and conditions of
such policies, including premium payments. None of the insurance carriers has   
indicated to the Seller or any of the Companies an intention to cancel, or      
materially alter the coverage under, any such policy. None of the Companies has 
any claim pending against any of the insurance carriers under any of such       
policies and, to the knowledge of the Seller or any of the Companies, there has 
been no actual or alleged occurrence of any kind which may give rise to any such
claim and has not made any claims under any policy at any time since January 1, 
1998, except as set forth in Schedule 4.17. All applications for such policies  
are accurate in all material respects.                                          

4.18 Governmental Authorizations. Schedule 4.18 lists all material  
authorizations, consents, approvals, franchises, licenses and permits required  
under Applicable Law or regulation for the operation of the business of the     
Companies as presently operated (the "Governmental Authorizations"). All the    
Governmental Authorizations are in full force and effect, and each of the       
Companies is in compliance with the terms and conditions of all the Governmental
Authorizations, except where the failure to obtain such Governmental            
Authorizations or the failure to comply with the terms thereof would not have a 
Material Adverse Effect. The Seller has no knowledge that any of the            
Governmental Authorizations will not be renewed in the ordinary course or will  
be revoked, terminated, suspended, or impaired.                                 

4.19 Intellectual Property Rights                                   

        (a) Except as set forth on Schedule 4.19, the Companies, directly or
indirectly, own or have the valid right to use pursuant to license agreements   
(the "License Agreements"), all Intellectual Property currently used in         
connection with the business of the Companies as currently conducted (such      
Intellectual Property, together with the License Agreements the "Company        
Intellectual Property").                                                        

    (b) Schedule 4.19 sets forth a complete and accurate list of all
United States, international and state (i) patents and patent applications, (ii)
Trademark registrations and applications and all material unregistered          
Trademarks, (iii) Internet domain names, and (iv) copyright registrations and   
applications, and all material unregistered copyrights, including websites and  
Software (excluding commercially available off the shelf Software), owned by any
of the Companies or any other person listed on Schedule 4.19 or used in the     
business of the Companies or Seller as currently conducted, indicating for each,
the applicable jurisdiction, registration number (or application number), date  
issued (or date filed) and descriptions of such property.                       

       (c) Except as set forth on Schedule 4.19, the Intellectual Property
set forth on Schedule 4.19 is solely and exclusively owned by the Companies free
and clear of all Encumbrances, and as for all registered Intellectual Property, 
one of the Companies is listed in the records of the appropriate United States, 
state or foreign agency as the sole owner of record for each registration and   
application for any Patent, Trademark, Internet domain name and Copyright.      
Except as set forth on Schedule 4.19, all of the Intellectual Property          
registrations and applications and common law trademarks set forth on Schedule  
4.19, and the trademark rights underlying any trademark registrations,          
applications and common law marks set forth on Schedule 4.19, are valid and     
subsisting, in full force and effect, and have not been cancelled, expired, or  
abandoned. Neither the Seller nor any of the Companies has received any written,
or,                                                                             

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to the knowledge of the Seller or any of the Companies, oral notification of any
pending or threatened opposition, interference or cancellation proceeding before
any court or registration authority in any jurisdiction against the items set   
forth on Schedule 4.19 or any other Company Intellectual Property, directly or  
indirectly, owned by any of the Companies or against any Company Intellectual   
Property not owned by any of the Companies.                                     

       (d) Except as set forth on Schedule 4.19, there are no settlements,
injunctions, forbearances to sue, consents, judgments, or orders or similar     
obligations to which any of the Companies is a party or is otherwise bound,     
which (i) restrict any of the Company's rights to use any Company Intellectual  
Property, (ii) restrict any of the Company's business in order to accommodate a 
third party's Intellectual Property rights or (iii) permit third parties to use 
any Intellectual Property which would otherwise infringe any Company            
Intellectual Property. None of the Companies has licensed or sublicensed its    
rights in any Company Intellectual Property other than pursuant to the License  
Agreements set forth on Schedule 4.19 and no royalties, honoraria or other fees 
are payable by any of the Companies for the use of or right to use any Company  
Intellectual Property in connection with the Companies' business as currently   
conducted, except pursuant to the License Agreements set forth on Schedule 4.19.

        (e) The License Agreements, permits and other agreements under which
any of the Companies has rights to the Company Intellectual Property are valid  
and binding obligations of such Company or Companies and all other parties      
thereto, enforceable in accordance with their terms, and Seller is aware of no  
event or condition which will result in a violation or breach of, or constitute 
(with or without due notice or lapse of time or both), a default by any of the  
Companies, under any such License Agreement or other agreement.                 

      (f) Each of the Companies takes reasonable measures to protect the
confidentiality of its Trade Secrets. Except as set forth in Schedule 4.19, no  
material Trade Secret of any of the Companies as currently operated or planned  
to be operated has been improperly disclosed or authorized to be disclosed to   
any third party.                                                                

        (g) The Seller or the Companies have received no written notice, or,
to the knowledge of the Seller or any of the Companies, oral notification that  
the conduct of the business of the Seller or the Companies as currently         
conducted infringes any Intellectual Property rights owned or controlled by any 
third party (either directly or indirectly such as through contributory         
infringement or inducement to infringe) or is defamatory or violative in any way
of any publicity, privacy, or other rights. Neither the Seller nor any of the   
Companies has received any written notice or, to the knowledge of the Seller or 
any of the Companies, oral notification of any pending or threatened claims or  
suits (i) alleging that the Companies' activities or the conduct of their       
businesses infringes upon or constitutes the unauthorized use of the            
Intellectual Property rights of any third party, nor alleging libel, slander,   
defamation, or other violation of a personal right, or (ii) challenging the     
ownership, use, validity or enforceability of any Company Intellectual Property.

        (h) To the knowledge of the Seller or any of the Companies, no third
party is misappropriating, infringing, diluting, or otherwise violating any     
Company Intellectual Property, and no such claims are pending against a third   
party by any of the Companies.                                                  

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         (i) The consummation of the transactions contemplated hereby will not
result in the loss or impairment of the Companies' right to own or use any of   
the Company Intellectual Property nor require the consent of any Governmental   
Authority or third party in respect of any such Company Intellectual Property.  

  (j) Except as set forth on Schedule 4.19, after the deliveries
provided for in this Agreement have occurred, none of the Seller or any current 
or former officer, director or employee of the Seller or any of the Companies   
will retain any rights of ownership or use with respect to the Company          
Intellectual Property. Except as set forth on Schedule 4.19 and except for      
commercially available off-the shelf computer software, all computer software   
and inventions currently used by any of the Companies or necessary for the      
conduct of the current business of any of the Companies were either (i)         
developed by an employee of the Companies within the scope of employment of the 
employee and pursuant to a binding invention assignment or work for hire        
agreement, (ii) developed by a third-party under a binding work for hire and    
assignment agreement, (iii) developed by a third party and transferred and      
assigned to one of the Companies under a binding transfer and assignment        
agreement or (iv) used by the Companies under license or permission set forth on
Schedule 4.19.                                                                  

      (k) Except as set forth on Schedule 4.19, none of the Companies is
currently licensing to a third party, and has not assigned or waived, its rights
to any Company Intellectual Property anywhere in the world. Other than as set   
forth on Schedule 4.19, there are no restrictions on use of the Company         
Intellectual Property.                                                          

    4.20 Major Customers and Suppliers; Supplies. Schedule 4.20 sets forth a
list of the largest customers with aggregate purchases in excess of $400,000    
(measured by dollar volume) of the Companies and the ten (10) largest suppliers 
of material goods or services to each Company for the year ended December 31,   
2000. Schedule 4.20 identifies those suppliers of significant goods or services 
with respect to which alternative sources of supply are not readily available on
comparable terms and conditions. Except as indicated on Schedule 4.20, all      
supplies and services necessary for the conduct of the business of the          
Companies, as presently conducted, may be obtained from alternate sources on    
terms and conditions comparable to those presently available to the Companies.  
To the Seller's knowledge, none of the Companies' major customers or suppliers  
has or is contemplating terminating its relationship with any of the Companies. 
To the knowledge of the Seller or any of the Companies, no major customer or    
supplier has experienced any material work stoppage or other material adverse   
circumstances or conditions that is reasonably likely to jeopardize or          
materially adversely affect any Company's future relationship with any major    
customer or supplier. Except as set forth on Schedule 4.20, there are no pending
material disputes or controversies between any major customer or supplier of any
of the Companies.                                                               

   4.21 Related Parties. Except as set forth on Schedule 4.21, neither the
Seller nor any of the Companies, nor any current or former (within the past     
three (3) years) director, or officer of the Seller or any of the Companies, or 
any of their family members (individually a "Related Party" and collectively the
"Related Parties"), or any Affiliate of the Seller or any of the Companies or   
any Related Party: (a) owns, directly or indirectly, any interest in any Person 
which is a competitor of any of the Companies, or of a supplier or customer of  
any of the Companies (except as an owner of one percent (1%) or less of the     
stock of any company listed                                                     

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on a national securities exchange or traded in the over-the-counter market); (b)
owns, directly or indirectly, in whole or in part, any material property, asset 
or right, real, personal or mixed, tangible or intangible (including, but not   
limited to, any of the intangible property) which is utilized in the operation  
of the business of any of the Companies; (c) has an interest in or is, directly 
or indirectly, a party to any material contract, agreement, lease or arrangement
pertaining or relating to any of the Companies, except for employment,          
consulting or other personal service agreements that may be in effect and which 
are listed on Schedule 4.21 hereto; or (d) to the knowledge of the Seller, has  
any cause of action or other claim whatsoever against, or owes any amount to,   
any of the Companies.                                                           

     4.22 List of Accounts and Proxies. Set forth on Schedule 4.22 is: (a) the
name and address of each bank or other institution in which any of the Companies
maintains an account (cash, securities or other) or safe deposit box; (b) the   
name and phone number of each Company's contact person at such bank or          
institution; (c) the account number of the relevant account and a description of
the type of account; (d) the name of each person authorized by any of the       
Companies to effect transactions therewith or to have access to any safe deposit
box or vault; and (e) all proxies, powers of attorney or other like instruments 
to act on behalf of any of the Companies in matters concerning its business or  
affairs.                                                                        

   4.23 Employee Policies, Manuals, etc. Schedule 4.23 contains the names,
descriptive title, and annual salary rates and other compensation of all        
officers, directors, consultants and senior employees of each of the Companies  
and the Seller who do work for any of the Companies (including compensation paid
or payable by any of the Companies under the Company Plans and the entity paying
the same). Schedule 4.23 sets forth a list of all employee policies, employee   
manuals or other written statements of rules or policies as to working          
conditions, vacation and sick leave applicable to such persons.                 

4.24 Labor Relations                                                

          (a) There is no strike, sympathy strike, sit-down, slow-down, stay-in,
sick-out, walk-out, picketing, work stoppage, retarding of work, boycott or any 
other interference with any of the Companies' business or the operation or      
conduct of the business of any of its affiliated companies or its subsidiaries  
(all of the foregoing referred to as "work interference"), and the Seller has no
knowledge of any pending or threatened work interference. There have been no    
work interferences within the past five years. None of the Companies is in      
breach in any material respect of any provision of any collective bargaining    
agreement, and the Companies have not received any written notification or to   
the knowledge of the Companies any oral notification that any such claims have  
been made or are pending. None of the Companies is in breach of any court,      
arbitration, administrative decision or order which is reasonably likely to     
result in any work interference or give rise to a claim that a work interference
is protected by, or does not violate, any law or provision of any collective    
bargaining agreement.                                                           

    (b) There are no unfair labor practices, representation or other
proceedings claimed, pending or, to the Seller's knowledge, threatened before   
any Governmental Authority.                                                     

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   (c) There are no filed, pending or, to the knowledge of Seller,
threatened injunctions against any of the Companies which would have the effect 
of constituting a work interference.                                            

4.25 Employee Benefit Plans                                         

       (a) None of the Companies has had any defined benefit plan. None of
the Companies has, nor does any of the Companies contribute to any pension,     
profit-sharing, defined contribution, option, other incentive plan, or any other
type of Employee Benefit Plan (as defined in Section 3(3) of the Employee       
Retirement Income Security Act of 1974, as amended ("ERISA")), or have any      
obligation to or customary arrangement with employees for bonuses, incentive    
compensation, vacations, severance pay, insurance, or other benefits and it is  
not part of a controlled group with regard to any of the foregoing, except as   
set forth in Schedule 4.25. The Companies have made available to AHI true and   
correct copies of all documents evidencing plans, obligations, qualification,   
IRS determination or arrangements referred to in Schedule 4.25 (or true and     
correct in all material respects written summaries of such plans, obligations,  
or arrangements to the extent not evidenced by documents) and true and correct  
in all material respects copies of all documents evidencing trusts relating to  
any such plans. Schedule 4.25 also contains a true and correct statement of the 
names, relationship with each Company, job description, present rates of        
compensation (delineated by annual salary, bonuses, commissions, benefits, or   
other supplemental compensation now or hereafter payable), and aggregate        
compensation for the fiscal year ended December 31, 2000 of (i) each officer of 
each Company that is paid by the Seller or any of its Subsidiaries other than   
the Company or any of its Subsidiaries. Except as set forth on Schedule 4.25,   
none of the Companies has changed the rate of compensation of any of its        
directors, officers, employees, agents, dealers, or distributors since December 
31, 2000.                                                                       

        (b) No Employee Benefit Plan (as so defined) of any of the Companies
or of any plan of any controlled group relating to any of the Companies is, or  
during the last three years was, subject to Title IV of ERISA.                  

   (c) There has been no violation of the reporting and disclosure
requirements imposed either under ERISA or the Code for which a penalty has been
or may be imposed with respect to any such Employee Benefit Plan. There is no   
investigation, litigation, arbitration, claim, governmental or other proceeding 
(formal or informal), pending and, to the knowledge of the Seller, there is no  
litigation, arbitration, claim, governmental or other proceeding (formal or     
informal), or investigation threatened with respect to any such Employee Benefit
Plan or related trust or with respect to any fiduciary, administrator, or       
sponsor (in its capacity as such) of any such Employee Benefit Plan. No event   
has occurred or, to the knowledge of the Seller, is threatened which would      
constitute a non-exempt prohibited transaction under Section 406 of ERISA.      

       (d) Except as set forth in Schedule 4.25, none of the Companies has
any Employee Pension or Employee Welfare Benefit Plans (as defined in Section   
3(2) of ERISA) and is not part of any controlled group that has any Employee    
Pension Benefit Plan.                                                           

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 (e) None of the Companies contributes or has an obligation to
contribute to including but not limited to actual or potential withdrawal       
liability payable to any multiemployer Pension Plan within the meaning of       
Section 3(37) of ERISA and is not part of any controlled group that contributes,
or has an obligation to contribute, to any multi-employer Pension Plan.         

        (f) Each of the Companies is in material compliance with all present
and past collective bargaining agreements, memoranda of agreement, side letters,
court, administrative, arbitration, ADR, or mediation decisions or awards, wage 
or benefit schedules and all other documents which reflect or pertain to        
understandings or practices communicated or agreed upon between such Company and
any union representatives.                                                      

   (g) There are no claims or grievances filed, pending or, to the
Seller's of any of the Company's knowledge, threatened pertaining to present or 
past collective bargaining agreements, memoranda of agreement, side letters,    
court, administration, arbitration, ADR or mediation decisions or awards or     
other documents.                                                                

(h) There are no complaints, charges, claims, allegations or
grievances pending or to the knowledge of the Seller or any of the Companies    
threatened which reflects or pertains to: (i) any federal, state or local labor,
employment, wage or hour, workers compensation, disability or unemployment law, 
regulation or ordinance; (ii) any claim for wrongful discharge, breach of       
employment contract or employment related tort (iii) any employment agreement,  
restrictive convent, non-competitive agreement or employee confidentiality      
agreement, except for such failures to be in compliance that will not have a    
Material Adverse Effect.                                                        

         (i) Each of the Companies is in material compliance with all past and
present profit sharing plans, money purchase plans, target benefit plans,       
ESOP's, stock bonus plans, defined benefit plans or any other tax qualified     
employee benefit plan, whether terminated or not, and any amendments thereto.   

         (j) Each of the Companies is in material compliance with all past and
present welfare benefit plans, (i.e., health, dental, vision, long term         
disability, short term disability, life insurance), child care, tuition         
reimbursement, prepaid legal services, severance plans, programs or             
arrangements.                                                                   

         (k) Each of the Companies is in material compliance with all past and
present supplemental benefit plans, deferred compensation plans, executive      
compensation agreements, bonus agreements, consulting agreements or any other   
non-qualified employee benefit plans.                                           

         (l) Each of the Companies is in material compliance with all past and
present trusts, group annuity contracts, IRC Section 501(c)(9) Voluntary        
Employees' Beneficiary Association, cafeteria plans and any Multiple Employer   
Welfare Arrangements as described in Sections 3(1) and 40(A) of ERISA.          

     (m) None of the Companies is engaged in any non-exempt prohibited
transaction with respect to any employee benefit plan governed by ERISA.        

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         (n) In connection with subparagraphs (i) through (m) above, there are
no complaints, charges, claims, litigation, audits, investigations or           
administrative proceedings filed, pending or, to the knowledge of the Seller or 
any of the Companies, threatened against any of the Companies.                  

4.26 Taxes                                                          

          (a) The Seller has previously delivered to Purchaser true, correct and
complete copies of pro forma tax returns of the Companies for the past five     
fiscal years which were due, without regard to any extensions granted, on or    
before the date hereof. All material tax returns and tax reports required to be 
filed with respect to the income, operations, business or assets of any of the  
Companies or each affiliated, combined or unitary group ("Tax Group") of which  
any of the Companies has been a member have been timely filed (or appropriate   
extensions have been obtained which extensions are listed on Schedule 4.26) with
the appropriate governmental agencies in all jurisdictions in which such returns
and reports are required to be filed. All of the foregoing as filed are true,   
correct and complete and, in all respects, reflect accurately all liability for 
Taxes of each of the Companies for the periods to which such returns relate, and
all amounts shown as owing thereon have been paid, other than Liabilities for   
Taxes on the Closing Date Balance Sheet and except for Taxes being contested in 
good faith as set forth on Schedule 4.26. All income, profits, franchise, sales,
use, value added, occupancy, property, excise, payroll, withholding, FICA, FUTA 
and other Taxes (including interest and penalties), if any, collectible or      
payable by the Seller or any of the Companies or relating to or chargeable      
against any of its assets, revenues or income or relating to any employee,      
independent contractor, creditor, stockholder or other third party through      
December 31, 2000, were fully collected and paid by such date or provided for by
adequate reserves in the Financial Statements or, for periods thereafter, on the
books of the Seller or the Companies, as the case may be.                       

        (b) To the knowledge of the Seller, no taxation authority has sought
to audit, and none of the Companies has received notice of an audit of, the     
records of the Seller, with respect to the Companies or any of the Companies for
the purpose of verifying or disputing any tax returns, reports or related       
information and disclosures provided to such taxation authority, or related to  
the Seller or any of the Companies' alleged failure to provide any such tax     
returns, reports or related information and disclosure. Except as provided on   
Schedule 4.26, no claims, deficiencies, or assessments have been asserted       
against or inquiries raised with the Seller or any of the Companies with respect
to any Taxes of the Companies or other governmental charges or levies which have
not been paid or otherwise satisfied, including claims that, or inquiries       
whether the Seller, with respect to the Companies, or such Company, as the case 
may be, has not filed a tax return that it was required to file, and there      
exists no reasonable basis for the making of any such claims or inquiries.      
Neither the Seller nor any of the Companies has waived any restrictions on      
assessment or collection of Taxes relating to a Company or consented to the     
extension of any statute of limitations relating to taxation of a Company.      
Neither the Seller nor any of the Companies has filed a consent under Section   
341(f) of the Code with respect to the Companies concerning collapsible         
corporations, and none of the Companies has been a United States real property  
holding corporation within the meaning of Code Section 897 (c)(2), during the   
applicable period specified in Code Section 897(c)(1)(A)(ii).                   

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 (c) No claim has been made, nor does the Seller or any of the
Companies know of any claim that is pending, by an authority in any jurisdiction
where neither of the Seller nor any of the Companies files tax returns alleging 
that the Seller, with respect to any of the Companies, or any of the Companies  
is or may be subject to taxation in that jurisdiction.                          

         (d) Except for (i) Taxes for the payment of which an adequate reserve
has been established on the Closing Date Balance Sheet and (ii) property taxes  
that are not delinquent, there is no Tax lien imposed by any taxing authority   
outstanding against any of the assets or properties of any of the Companies.    

         (e) Neither the Seller, with respect to any of the Companies, nor any
of the Companies has executed any "closing agreement" or similar agreement with 
any taxing authority, domestic or international.                                

         (f) Neither the Seller, with respect to any of the Companies, nor any
of the Companies has agreed or is required to make any adjustments pursuant to  
Section 481(a) of the Code or any similar provision of other tax law, domestic  
or foreign, by reason of a change in accounting method initiated by it or any   
other relevant party nor has it any knowledge that any taxing authority has     
proposed any such adjustment or change in accounting method. Neither the Seller 
with respect to the Companies nor any of the Companies has any application      
pending with any taxing authority anywhere in the world requesting permission   
for any changes in accounting methods.                                          

         (g) Neither the Seller, with respect to any of the Companies, nor any
of the Companies has made any payments, nor is the Seller, with respect to any  
of the Companies, or any of the Companies obligated to make any payments, nor is
the Seller, with respect to the Companies or any of the Companies a party to any
agreement that under certain circumstances could obligate it to make payments   
that will not be deductible under Section 280G or 162(m) of the Code.           

          (h) None of the Companies is a member of a Tax Group that has filed an
election pursuant to Rev. Proc. 95-11, 1995-1 C.B. 505 or under Treasury        
Regulation Section 1.1502-75(c) or any similar provision of national, foreign,  
state or local law with respect to the Company.                                 

         (i) Neither the Seller, with respect to the Companies, nor any of the
Companies has reported on its income tax returns any positions taken therein    
that could give rise to a substantial understatement of federal or other income 
tax within the meaning of Section 6662 of the Code or similar statute.          

4.27 Material Agreements                                            

      (a) Schedule 4.27(a) sets forth a list of the following contracts,
agreements, binding bids, binding proposals, or binding quotations to which, as 
of the date hereof, any of the Companies is a party or signatory or pursuant to 
which any of the Companies has third party rights (except with respect to the   
Leases, which are set forth on Schedule 4.16, which is hereby incorporated by   
reference into Schedule 4.27 and made a part thereof): (i) contract or series of
contracts resulting in a commitment or potential commitment for expenditure or  
other obligation                                                                

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or potential obligation, or which provides for the receipt or potential receipt,
involving in excess of Fifty Thousand Dollars ($50,000.00) in any instance, or  
series of related contracts that in the aggregate give rise to rights or        
obligations exceeding such amount other than contracts with Governmental        
Authorities referred to in clause (ii) and armoring contracts referred to in    
clause (iii); (ii) contract, agreement, binding bid, binding proposal, or       
binding quotation with a Governmental Authority resulting in a commitment or    
potential commitment for expenditure or other obligation or potential           
obligation, or which provides for the receipt or potential receipt, involving in
excess of One Hundred Thousand Dollars ($100,000.00) in any instance, or series 
of related contracts that in the aggregate give rise to rights or obligations   
exceeding such amount; (iii) contract, agreement, binding bid, binding proposal,
or binding quotation relating to the provision of armoring services resulting in
a commitment or potential commitment for expenditure or other obligation or     
potential obligation, or which provides for the receipt or potential receipt,   
involving in excess of Two Hundred Fifty Thousand Dollars ($250,000.00) in any  
instance, or series of related contracts that in the aggregate give rise to     
rights or obligations exceeding such amount other than contracts referred to in 
clause (i) and contracts with Governmental Authorities referred to in clause    
(ii); (iv) employment agreements, collective bargaining agreements and any      
amendments or modifications thereof and union recognition agreements, (v)       
indenture, mortgage, promissory note, loan agreement, guarantee or other        
agreement or commitment for the borrowing or lending of money or Encumbrance of 
assets involving more than Twenty Five Thousand Dollars ($25,000.00) in each    
instance; (vi) agreement which restricts any of the Companies from engaging in  
any line of business or from competing with any other Person; (vii) warranties  
made with respect to products manufactured, packaged, distributed or sold by any
of the Companies; or (viii) any partnership, shareholder, joint venture, or     
similar agreement or arrangement to which the Seller or any of the Companies is 
a party (collectively, and together with the Leases, Company Plans and all other
agreements required to be disclosed on any schedule to this Agreement, the      
"Material Agreements"). Each of the Companies has previously made available to  
Purchaser true, complete and correct copies of all written agreements, as       
amended, required to be listed on Schedule 4.27.                                

    (b) None of the Material Agreements was entered into outside the
ordinary course of business of the Company which is party to such Material      
Agreement.                                                                      

     (c) Except as set forth on Schedule 4.27(b), each of the Material
Agreements is in full force and effect and are the valid and legally binding    
obligations of the Company which is party to such Material Agreement and, to the
knowledge of Seller, the other parties thereto, enforceable in accordance with  
their respective terms, subject only to bankruptcy, insolvency or similar laws  
affecting the rights of creditors generally and to general equitable principles.
Neither the Seller nor any of the Companies has received written or, to the     
Seller's knowledge, oral notice of default by any of the Companies under any of 
the Material Agreements, including any contract or agreement relating to        
borrowed money to which any of the Companies is a party or by or to which it or 
its assets are bound or subject, and no event has occurred which, with the      
passage of time or the giving of notice or both, would constitute a material    
default by any of the Companies thereunder. Neither the Company which is party  
to any Material Agreement nor, to the knowledge of the Seller or any of the     
Companies, any of the other parties to any of the Material Agreements is in     
material default thereunder, nor, to the knowledge of the Seller or any of the  
Companies, has an event occurred which, with the passage of time or the giving  
of notice or both would constitute a material default by such other party       
thereunder. Neither the Seller nor                                              

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any of the Companies has received written notice or, to the knowledge of Seller,
oral notice of the pending or threatened cancellation, revocation or termination
of any of the Material Agreements, including, without limitation, any agreements
relating to borrowed money to which any of the Companies is a party or by or to 
which it or its assets are bound or subject, nor are any of them aware of any   
facts or circumstances which are reasonably likely to lead to any such          
cancellation, revocation or termination.                                        

         (d) Except as otherwise indicated on Schedule 4.27(c), the Seller and
the Companies have, with respect to all Governmental Contracts that are Material
Agreements: (i) complied in all respects with all certifications and            
representations they have executed, acknowledged or set forth with respect to   
each such Material Agreement, (ii) complied in all respects with all clauses,   
provisions and requirements incorporated expressly, by reference or by operation
of law in each such Material Agreement, and (iii) submitted certifications and  
representations with respect to each such Material Agreement that were accurate,
current and complete when submitted, and were properly updated to the extent    
required by law, regulation or the applicable Material Agreement, except where  
the failure to so comply or submit such certifications and representations is   
not reasonably likely to have, when considered in the aggregate with any other  
action or omission referred to in Sections 4.27(d) and (e), a material adverse  
effect on the validity or effectiveness of any of such Material Agreement, the  
rights of any of the Companies under any such Material Agreement, or the ability
of any of AHI, the Purchaser, or the Companies to enter into any Material       
Agreement with a U.S. Governmental Authority (a "Governmental Contract MAE").   

      (e) Except as otherwise indicated on Schedule 4.27(e), neither the
Seller nor any of the Companies has, with respect to all Governmental Contracts 
that are Material Agreements: (i) received written notice, or to the Seller's   
knowledge, oral notice that the Companies have breached or violated any law,    
regulation, statute, certification, representation, clause, provision, or       
requirement with respect to any such Material Agreement, (ii) received any show 
cause notice or cure notice with respect to any such Material Agreement, (iii)  
received any formal or informal determination that costs incurred under any such
Material Agreement have been questioned or disallowed, (iv) received any adverse
decision from a contracting officer relating to any such Material Agreement     
issued by any Governmental Authority, (v) received any written, or to the       
Seller's knowledge, oral notice that monies due under any such Material         
Agreement are or may be subject to withholding or setoff, which breach,         
violation, show cause notice, cure notice, determination, final decision,       
withholding, or setoff is reasonably likely to have a Governmental Contract MAE.

          (f) Except as otherwise indicated on Schedule 4.27(f), with respect to
all Governmental Contracts identified as Material Agreements, there are no      
pending claims against any Governmental Authority or, to the knowledge of the   
Seller, threatened claims against any prime contractor, subcontractor or vendor 
arising out of or relating to any such Governmental Contract, except for routine
demands in the ordinary course of business which are not reasonably likely to   
have a Governmental Contract MAE.                                               

       (g) With respect to each of the United States, Mexico, Philippines,
France, Colombia, and Brazil:                                                   

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              (i)       Neither the Seller nor any of the Companies has received
               any written notice that any of the Companies is
                        currently debarred or suspended from doing business with
                      any Governmental Authority, nor have they received any
                      written notice that they have been declared ineligible
                   for doing business with any Governmental Authority.
                   Neither the Seller nor any of the Companies has any
                 knowledge of any reasonably likely institution of
                      debarment, suspension, or ineligibility proceedings in
the future.                     

              (ii)      Neither the Seller nor any of the Companies has received
                     a written negative determination of responsibility by
              any Governmental Authority or government prime
                        contractor with respect to any of the Companies. Neither
                        the Seller nor any of the Companies has any knowledge of
               any reasonably likely negative determination of
               responsibility by any Governmental Authority or
                      government prime contractor with respect to any of the
Companies.                      

             (iii)     The Companies possess all necessary security clearances
                       and permits for the execution of their obligations with
                respect to any contract with or bid, proposal or
                    quotation submitted to any Governmental Authority or
                      government prime contractor. None of the Companies has
                       ever been denied a facility security clearance and none
                        of their employees have been denied a personal clearance
                        for reasons that is reasonably likely to have a Material
                    Adverse Effect on any of the Companies or the Seller
     with respect to any of the Companies.

4.28 Guaranties. Except as set forth on Schedule 4.28, none of the  
Companies is a party to any Guaranty, and no Person is a party to any Guaranty  
for the benefit of any of the Companies.                                        

4.29 Products                                                       

          (a) To the Seller's knowledge, there exists no reasonably likely basis
for (i) the withdrawal or suspension of any Governmental Authorization, approval
or consent of any Governmental Authority with respect to any product distributed
or sold by any of the Companies (a "Product") or (ii) the recall, withdrawal or 
suspension by order of any Governmental Authority of any Product. To the        
knowledge of the Seller, there are no defects in the designs, specifications, or
process with respect to any Product sold or otherwise distributed that will give
rise to any material Losses.                                                    

    (b) Schedule 4.29 sets forth a list and brief description of all
correspondence received or sent by or on behalf of the any of the Companies     
during the past five (5) years from or to any Governmental Authority with       
respect to a contemplated or actual recall, withdrawal, or suspension from the  
market of any Product. Copies of all such correspondence have previously been   
made available to Purchaser.                                                    

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4.30 Environmental and Safety Matters                               

         (a) Except as set forth on Schedule 4.30, to the knowledge of Seller,
the Seller and each of the Companies is currently in compliance with all        
Environmental and Safety Requirements, and neither the Seller nor any of the    
Companies has incurred Liabilities (whether accrued, absolute, contingent,      
unliquidated or otherwise) or is subject to any corrective, investigatory or    
remedial obligations arising under Environmental and Safety Requirements which  
relate to any of the Companies or any of their respective properties or         
facilities, except for such matters which is not reasonably likely to result in 
a Material Adverse Effect. Without limiting the generality of the foregoing,    
each of the Companies has obtained and complies with, all permits, licenses and 
other authorizations that is required pursuant to any Environmental and Safety  
Requirements for the occupancy of its properties or facilities or the operation 
of its Businesses as it is presently being conducted, and as it has been        
conducted in the past, except for such permits the absence of which or          
non-compliance with which is not reasonably likely to result in a Material      
Adverse Effect. Seller has provided Purchasers with an opportunity to review    
files containing all such permits, licenses and other authorizations of the     
Companies.                                                                      

  (b) To the knowledge of Seller, neither this Agreement nor the
consummation of the transactions contemplated by this Agreement shall impose any
obligations to notify or obtain the consent of any Governmental Authority or    
Regulatory Entities or third parties under any Environmental and Safety         
Requirements (including, without limitation, any so called                      
"transaction-triggered" or "responsible property transfer" laws and             
regulations).                                                                   

     (c) To the knowledge of Seller, neither the Seller nor any of the
Companies has treated, stored, disposed of, arranged for or permitted the       
disposal of, transported, handled or Released any hazardous substance causing   
any of them to incur any Liabilities for response costs, natural resource       
damages or attorneys fees pursuant to the Comprehensive Environmental Response, 
Compensation and Liability Act of 1980, as amended ("CERCLA"), or any other     
Environmental and Safety Requirements, which is not reasonably likely to give   
rise to a Material Adverse Effect.                                              

         (d) To the knowledge of Seller, none of the Companies, nor the Seller
on behalf of the Companies, has either expressly or by operation of law, assumed
or undertaken any liability or corrective, investigatory or remedial obligation 
of any other Person relating to any Environmental and Safety Requirements, which
is not reasonably likely to give rise to a Material Adverse Effect.             

    (e) No Environmental Lien has attached to any property leased or
operated by any of the Companies or the Seller on behalf of any of the          
Companies.                                                                      

4.31 Accounts Receivable, Notes Receivable, and Costs in Excess of  
Billing. All accounts, notes receivable and costs in excess of billing of each  
of the Companies as of the date hereof have arisen in the ordinary course of    
business, represent valid obligations to such Company for sales made, services  
performed or other charges and are, to the knowledge of Seller, not subject to  
claims or set-off, or other defenses or counter-claims. All items which are     
required by GAAP to be reflected as accounts and notes receivable on the        
Financial Statements                                                            

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and on the books and records of the Companies are so reflected and have been    
recorded in accordance with GAAP on a consistent basis in a manner consistent   
with past practice.                                                             

 4.32 Accounts and Notes Payable. The aggregate amount of accounts and
notes payable as of the date hereof does not exceed the aggregate amount of     
accounts and notes payable as of December 31, 2001. All such accounts and notes 
payable have arisen in the ordinary course of business and represent valid      
indebtedness of the Companies. All items which are required by GAAP to be       
reflected as accounts and notes payable on the Financial Statements and on the  
books and records of the Companies are so reflected and have been recorded in   
accordance with GAAP on a consistent basis in a manner consistent with past     
practice.                                                                       

      4.33 Inventory Valuation. The raw materials, work in process, spare parts,
and other inventory of the Companies as set forth on the Financial Statements   
was, and the raw materials, work in process, spare parts, and other inventory of
the Companies currently is, in usable or salable condition in the ordinary      
course of business. The raw materials, work in process, spare parts, and other  
inventory are not obsolete or excessive in any material amount and are not      
materially in excess of the normal purchasing patterns of the Companies. Neither
the Seller nor any of the Companies knows of any material adverse condition     
affecting the supply of materials available to any of the Companies. The amounts
of the inventories reflected on the Financial Statements and on the books and   
records of the Companies have been determined in accordance with GAAP           
consistently applied.                                                           

     4.34 Absence of Certain Business Practices. None of the Seller nor any of
the Companies, or any Affiliates of any of the Companies or any other Person    
acting with authority on behalf of any of the Companies, or for which any of the
Companies would have liability, acting alone or together, has with respect to   
the business or activities of any of the Companies: (a) received, directly or   
indirectly, any rebates, payments, commissions, promotional allowances or any   
other economic benefits, regardless of their nature or type, from any customer, 
supplier, trading company, shipping company, governmental employee or other     
Person with whom any of the Companies has done business directly or indirectly  
in violation of Applicable Law; or (b) directly or indirectly in violation of   
Applicable Law, given or agreed to give any gift or similar benefit to any      
customer, supplier, trading company, shipping company, governmental employee or 
other Person who is or may be in a position to help or hinder the business of   
any of the Companies (or assist any of the Companies in connection with any     
actual or proposed transaction) which (i) may subject any of the Companies to   
any material damage or any material penalty in any civil, criminal or           
governmental litigation or proceeding, (ii) if not given in the past, may have  
had a Material Adverse Effect, or (iii) if not continued in the future, may have
a Material Adverse Effect or subject any of the Companies to suit or penalty in 
any private or governmental litigation or proceeding. Each of the Companies has 
conducted its business in a manner that materially complies with the U.S.       
Foreign Corrupt Practices Act, except where such failure is not reasonably      
likely to have a Material Adverse Effect.                                       

      4.35 Review of Forms 10-K, 10-Q and 8-K. The Seller has (1) received AHI's
Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports  
on Form 8-K filed by it with the Commission since January 1, 2000, as well as   
AHI's Registration Statement on Form S-3, Registration No. 333-75053, and (2)   
had the opportunity to ask questions and receive answers from AHI concerning    
such Forms 10-K, 10-Q and 8-K, the documents incorporated by                    

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reference therein and the terms and conditions of this Agreement and to obtain  
any documents relating to AHI which are on file with the Commission and         
available for inspection by the public. The Seller is aware of the risks        
inherent in an investment in AHI and specifically the risks of an investment in 
the AHI Common Stock. In addition, Seller is aware and acknowledges that there  
can be no assurance of the future viability or profitability of AHI, nor can    
there be any assurance relating to the current or future price of the AHI Common
Stock, as quoted on the New York Stock Exchange, or market conditions generally.

    4.36 Public Documents; Compliance. Except as set forth on Schedule 4.36,
the Seller has filed with the SEC all forms, reports, schedules, registration   
statements, and documents which it was required to file since November 1, 1996  
through the date hereof pursuant to the Securities Act and the Exchange Act. The
forms, reports, schedules, registration statements, and documents filed by the  
Seller (i) complied as to form in all material respects with the requirements of
the Securities Act or the Exchange Act, as the case may be, and the rules and   
regulations thereunder, each as in effect on the date so filed or amended, and  
(ii) did not contain any untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary in order to make   
the statements therein, in light of the circumstances under which there were    
made, not misleading (in each case as of the respective dates that they were    
filed with the SEC, or if amended or superseded by a filing prior to the date of
this Agreement, then on the date of such filing). No Subsidiary of the Seller is
required to file any form, report, statement, schedule, registration statement, 
or other document with the SEC.                                                 

  4.37 FIRPTA. Neither the Seller nor any of the Companies is a `foreign
person' within the meaning of Section 1445 of the Code.                         

      4.38 Investment Representations. The Seller is acquiring the Consideration
Shares for its own account and will not sell, transfer, or otherwise dispose of 
any of the Consideration Shares or any interest therein, without registration   
under the Securities Act and applicable state "blue sky" laws, except in a      
transaction which in the opinion of counsel reasonably acceptable to AHI is     
exempt therefrom. The Seller is an "accredited investor" as that term is defined
in rules promulgated under the Securities Act. The Seller has such knowledge and
experience in financial and business matters as to be capable of evaluating the 
merits and risk of an investment in the AHI Common Stock and has obtained, in   
its judgment, sufficient information from AHI to evaluate the merits and risks  
of an investment in the AHI Common Stock. The Seller has been provided the      
opportunity to obtain information and documents concerning AHI and the AHI      
Common Stock, and has been given the opportunity to ask questions of, and       
receive answers from, the directors and officers of AHI concerning AHI and the  
AHI Common Stock and other matters pertaining to this investment. The Seller    
acknowledges that the offer of the AHI Common Stock will not be reviewed by any 
governmental agency and is being sold to the Seller in reliance upon exemption  
from the Securities Act. The Seller acknowledges that a customary legend        
reflecting the above restrictions will appear on the certificates representing  
the Consideration Shares. Nothing in this Section 4.38 limits or otherwise      
affects the Seller's right to rely upon the representations and warranties of   
AHI and the Purchaser made in this Agreement.                                   

      4.39 No Claims. Except as set fourth on Schedule 4.39, to the knowledge of
the Seller, none of the officers, directors, employees, consultants, or agents  
of the Seller or any of its                                                     

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Subsidiaries has Claims against any of the Companies or the Company Subsidiaries
by reason of any tort, breach of contract or violation of law.                  

      4.40 Disclosure. No representation or warranty of the Seller or any of the
Companies contained in this Agreement, or the schedules hereto, and no closing  
certificate furnished by the Seller or any of the Companies to AHI and/or the   
Purchaser at the Closing contains or will contain any untrue statement of a     
material fact or omits to state a material fact necessary in order to make the  
statements contained herein or therein, in light of the circumstances in which  
they are made, not misleading.                                                  

     4.41 Assumptions in the Execution Date Legal Opinion. All the assumptions
of facts in the Execution Date Legal Opinion and to the extent they are relied  
upon or assumed in the Bring Down Execution Date Legal Opinion are correct in   
all respects, except to the extent it would not adversely affect the opinion    
rendered in the Execution Date Legal Opinion. Without limiting the generality of
the foregoing:                                                                  

          (a) The information set forth in Exhibit A of the Execution Date Legal
Opinion is correct and complete in all respects, except to the extent it would  
not adversely affect the opinion rendered in the Execution Date Legal Opinion.  

         (b) The assumptions in the Execution Date Legal Opinion regarding (i)
the current market value of all of the Seller's operating assets, and (ii) the  
assets to be sold to the Purchaser (i.e., 100% of the outstanding capital stock 
of the Companies) not accounting for a greater percentage of the current market 
value of the Seller's assets than the percentage of the book value of the       
Seller's assets set forth in Exhibit A to the Execution Date Legal Opinion are  
correct and complete in all respects, except to the extent it would not         
adversely affect the opinion rendered in the Execution Date Legal Opinion.      

         (c) The assumptions in the Execution Date Legal Opinion regarding the
transfer of the Companies and the Company Subsidiaries is correct and complete  
in all respects, except to the extent it would not adversely affect the opinion 
rendered in the Execution Date Legal Opinion.                                   

     4.42 Projections. The projections relating to operations of the Companies
for the quarter ended March 31, 2001 attached hereto as Schedule 4.42 (the      
"Projections"), have been prepared in good faith. The Seller reasonably believes
that the assumptions on which the Projections are based are reasonable; however,
there can be no assurances that the Projections will be achieved.               

ARTICLE V.
 INDEMNIFICATION; RELEASES, ETC.

   5.1 Survival of the Representations and Warranties. The representations
and warranties contained in Sections 4.1, 4.2, 4.14 (with respect to matters    
relating to title to the Securities), 4.25, 4.26, and 4.34 shall survive the    
Closing and remain in effect until the expiration of the applicable statute of  
limitations. The representations and warranties contained in Section 4.30 shall 
survive the Closing and remain in effect for a period of four and one-half (4   
1/2) years following the Closing. All other representations and warranties of   
AHI, Purchaser, the                                                             

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Seller and the Companies set forth in this Agreement shall survive the Closing  
for the lesser of (i) two (2) years following the Closing Date and (ii) 30 days 
following the completion of the second consolidated year end audit of AHI by    
AHI's independent accountants. The parties to this Agreement agree that except  
with respect to all equitable remedies, including injunctive relief and specific
performance, the exclusive remedies for any breach of a representation,         
warranty, covenant, or agreement set forth herein shall be the indemnification  
provisions set forth in any applicable Section herein. AHI and the Purchaser    
shall have all remedies available at law or equity with respect to a claim of   
fraud by the Seller or any of the Companies.                                    

5.2 Investigation. The representations, warranties, covenants and   
agreements set forth in this Agreement shall not be affected or diminished in   
any way by any investigation (or failure to investigate) at any time by or on   
behalf of the party for whose benefit such representations, warranties,         
covenants and agreements were made. All statements contained herein or in the   
Disclosure Schedule or in any certificate delivered pursuant hereto at the      
Closing shall be deemed to be representations and warranties for purposes of    
this Agreement.                                                                 

5.3 Indemnification Generally                                       

     (a) By the Companies and the Seller. The Seller and the Companies
(but, with respect to the Companies, only if the Closing has not occurred),     
agree, jointly and severally, to be responsible for and shall pay and indemnify 
and hold harmless Purchaser and AHI and its directors, officers, employees and  
agents from, against and in respect of, the full amount of any and all          
liabilities, damages, claims, deficiencies, fines, assessments, losses,         
penalties, interest costs and expenses, including, without limitation,          
reasonable fees and disbursements of counsel (collectively, "Losses"), arising  
from, in connection with, or incident to (i) any breach or violation of any of  
the representations, warranties, covenants or agreements of the Seller or any of
the Companies contained in this Agreement (other than the representations and   
warranties set forth in Section 4.26), the Disclosure Schedule, or any closing  
certificate delivered at Closing; (ii) any liability resulting from any         
litigation involving the Companies, if no accrual for such liability was taken  
into account in the preparation of the Closing Date Balance Sheet or if an      
accrual for such liability was taken into account in the preparation of the     
Closing Date Balance Sheet, to the extent such liability exceeds the accrual for
such liability set forth on the Closing Date Balance Sheet, regardless of       
whether or not such litigation was disclosed by the Seller on Schedule 4.6;     
(iii) Seller's failure to obtain the approval of its shareholders of the        
consummation of the transactions contemplated hereby; (iv) any and all claims   
arising out of, relating to, resulting from or caused (whether in whole or in   
part) by any transaction, event, condition, occurrence or situation in any way  
relating to the Seller, its Subsidiaries (other than the Companies and the      
Company Subsidiaries) and the Transferred Company Subsidiaries or the conduct of
their business at any time (v) the transfer of the Transferred Company          
Subsidiaries to the Seller; (vi) any Claims asserted by Thomas O'Gara against   
any of the Companies or the Company Subsidiaries; (vii) any liability arising   
from or relating to any item set forth on Schedule 4.30, (viii) any liability   
resulting from any shareholders derivative action instituted against the Seller 
relating to or resulting from this Agreement and the transactions contemplated  
hereby and (ix) any and all actions, suits, proceedings, demands, assessments or
judgments, costs and expenses incidental to any of the foregoing.               

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  (b) By the Purchaser. AHI and the Purchaser agree, jointly and
severally, to indemnify and hold harmless the Seller, and its directors,        
officers, employees, and agents from, against and in respect of, the full amount
of any and all Losses, costs and expenses, including, without limitation,       
reasonable fees and disbursements of counsel arising from, in connection with,  
or incident to (i) any breach or violation of any of the representations,       
warranties, covenants or agreements of AHI or the Purchaser contained in this   
Agreement or any agreement referred to herein and delivered at or prior to the  
Closing and (ii) any and all actions, suits, proceedings, demands, assessments  
or judgments, costs and expenses incidental to any of the foregoing.            

     (c) Indemnity Procedure. A party or parties hereto agreeing to be
responsible for or to indemnify against any matter pursuant to this Agreement is
referred to herein as the "Indemnifying Party" and the other party or parties   
claiming indemnity is referred to as the "Indemnified Party".                   

           (i)       An Indemnified Party under this Agreement shall, with
                    respect to claims asserted against such party by any
                    third party, give written notice to the Indemnifying
                       Party of any liability which might give rise to a claim
                 for indemnity under this Agreement, to the extent
                     reasonably possible, not later than fifteen (15) days
                      prior to the date any answer or responsive pleading is
                    due, and with respect to other matters for which the
                       Indemnified Party may seek indemnification, give prompt
               written notice to the Indemnifying Party of any
              liability which might give rise to a claim for
                      indemnity; provided, however, that any failure to give
                        such notice will not waive any rights of the Indemnified
             Party, except to the extent the rights of the
             Indemnifying Party are materially prejudiced.

         (ii)      The Indemnifying Party shall have the right, at its
                        election, to take over the defense or settlement of such
                       claim by giving written notice to the Indemnified Party
                       at least ten (10) days prior to the time when an answer
                   or other responsive pleading or notice with respect
                    thereto is required. If the Indemnifying Party makes
                       such election, it may conduct the defense of such claim
               through counsel of its choosing (subject to the
                   Indemnified Party's approval of such counsel, which
                      approval shall not be unreasonably withheld), shall be
                       solely responsible for the expenses of such defense and
               shall be bound by the results of its defense or
                     settlement of the claim. The Indemnifying Party shall
                     not settle any such claim without prior notice to and
                    consultation with the Indemnified Party, and no such
                     settlement involving any equitable relief or which is
                  reasonably likely to have an adverse effect on the
                      Indemnified Party may be agreed to without the written
                     consent of the Indemnified Party (which consent shall
             not be unreasonably withheld). So long as the
                    Indemnifying Party is diligently contesting any such
                   claim in good faith, the Indemnified Party may pay,
settle, or compromise such      

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                        claim only at its own expense and the Indemnifying Party
                      will not be responsible for the fees of separate legal
                  counsel to the Indemnified Party, unless the named
                  parties to any proceeding include both parties and
                        representation of both parties by the same counsel would
                  be a conflict of interest for such counsel. If the
                  Indemnifying Party does not make such election, or
                     having made such election does not, in the good faith
                   reasonable opinion of the Indemnified Party proceed
                     diligently to defend such claim, then the Indemnified
                   Party may (after written notice to the Indemnifying
                       Party), at the expense of the Indemnifying Party, elect
                      to take over the defense of and proceed to handle such
                        claim in its discretion and the Indemnifying Party shall
              be bound by any defense or settlement that the
                        Indemnified Party may make in good faith with respect to
                     such claim. In connection therewith, the Indemnifying
                     Party will fully cooperate with the Indemnified Party
                   should the Indemnified Party elect to take over the
defense of any such claim.      

            (iii)     The parties agree to cooperate in defending such third
                    party claims and the Indemnified Party shall provide
                      such cooperation and such access to its books, records
              and properties as the Indemnifying Party shall
                       reasonably request with respect to any matter for which
                    indemnification is sought hereunder; and the parties
                     hereto agree to cooperate with each other in order to
               ensure the proper and adequate defense thereof.

      (iv)      With regard to claims of third parties for which
          indemnification is payable hereunder, such
                       indemnification shall be paid by the Indemnifying Party
                 upon the earliest to occur of: (i) the entry of a
              judgment against the Indemnified Party and the
                 expiration of any applicable appeal period, or if
                 earlier, five (5) days prior to the date that the
                        judgment creditor has the right to execute the judgment;
                   (ii) the entry of an unappealable judgment or final
                    appellate decision against the Indemnified Party; or
                    (iii) a settlement of the claim. Notwithstanding the
                       foregoing, provided that there is no good faith dispute
               as to the applicability of indemnification, the
                       reasonable expenses of counsel to the Indemnified Party
             shall be reimbursed on a current basis by the
                      Indemnifying Party if such expenses are a liability of
                       the Indemnifying Party. With regard to other claims for
                which indemnification is payable hereunder, such
             indemnification shall be paid promptly by the
                        Indemnifying Party upon demand by the Indemnified Party.
                     Seller may elect to satisfy, in whole or in part, any
                      obligation under this Section 5.3 by delivering to AHI
                     Consideration Shares valued at the Average Price with
     respect to the date of such delivery.

(d) Right To Set-off. Should Purchaser or AHI be entitled to
indemnification by the Seller against the Seller, the Purchaser or AHI may first
set-off and deduct from the                                                     

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Escrow Amount the amount of any Losses for which the Seller is required to      
indemnify Purchaser or AHI hereunder. The Seller may set off the amount of any  
Loss for which the Seller is required to indemnify the Purchaser or AHI pursuant
to Section 5.6(b)(iii) against the amount of any Loss for which the Purchaser or
AHI is required to indemnify the Seller. Except as set forth in Section 2.6, the
Purchaser or AHI may set-off the amount of any Loss for which the Purchaser or  
AHI is required to indemnify the Seller against the amount of any Loss for which
the Seller is required to indemnify the Purchaser or AHI. Seller may elect to   
satisfy, in whole or in part, any obligation under this Section 5.3(d) by       
delivering to AHI Consideration Shares valued at the Average Price as of the    
date of such delivery.                                                          

(c) Limitations on Indemnification.                         

     (i)       No indemnification payment shall be made to the
                        Purchaser, AHI, or their respective directors, officers,
                     employees or agents pursuant to this Agreement, until
                  the amounts which the Purchaser would otherwise be
                 entitled to receive as indemnification under this
          Agreement aggregate at least $500,000 (the
                      "Deductible"), at which point AHI and/or Purchaser, as
                    applicable, shall be entitled to be indemnified with
                        respect to aggregate Losses in excess of the Deductible.
                    The indemnification provisions set forth in Sections
                      5.3(a)(i) (with respect to Section 4.25), 5.3(a)(iii),
                     5.3(a)(vi), 5.3(a)(viii), 5.6, 5.7 or 7.13(c) or with
                respect to a claim of fraud by the Seller or the
                     Companies shall not be subject to the limitations set
forth in this Section 5.3(e).   

(ii)      Anything in this Agreement to the contrary
                    notwithstanding, no indemnification payment shall be
               required to be made to Purchaser, AHI and their
                        respective directors, officers, employees or agents with
                     respect to a breach by Seller or the Companies of any
                      representation or warranty set forth herein, in excess
                     of $40,000,000; provided, however, that the foregoing
                 limitation shall not apply to the indemnification
                       provisions set forth in Section 5.3(a)(i) (with respect
                     to Sections 4.25, and 4.30), 5.3(a)(iii), 5.3(a)(vi),
                      5.3(a)(vii), 5.3(a)(viii), 5.6, 5.7 or 7.13(c) or with
                respect to a claim of fraud by the Seller or the
Companies hereto.               

          (iii)     The indemnification obligations of any party to this
                        Agreement under this Section 5.3 shall be reduced by any
                  insurance proceeds which the Indemnified Party has
                       received in respect of such Losses, costs and expenses.

        (iv)      AHI and the Purchaser hereby waive their rights to
punitive damages.               

 5.4 General Releases. As additional consideration for the sale of the
Securities pursuant to this Agreement, the Seller, on behalf of itself and its  
Subsidiaries (other than the                                                    

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Companies and the Company Subsidiaries) and controlled Affiliates hereby        
unconditionally and irrevocably releases and forever discharges, effective as of
the Closing Date, each of the Companies, the Company Subsidiaries, and the      
officers, directors, employees and agents of the Companies and the Company      
Subsidiaries, from any and all rights, claims, demands, judgments, obligations, 
liabilities and damages, whether accrued or unaccrued, asserted or unasserted,  
and whether known or unknown ("Claims"), relating to any of the Companies or the
Company Subsidiaries which ever existed or now exist, by reason of any tort,    
breach of contract, violation of law or other act or failure to act which shall 
have occurred at or prior to the Closing Date, or in relation to any other      
liabilities of any of the Companies or Company Subsidiaries to the Seller. The  
Seller expressly intends that the foregoing release shall be effective          
regardless of whether the basis for any claim or right hereby released shall    
have been known to or anticipated by the Seller.                                

5.5 Joint and Several Obligation. All representations, warranties,  
covenants, agreements, and liabilities of the Seller and the Companies, on the  
one hand, and AHI and the Purchaser, on the other hand, under this Agreement,   
including without limitation under Sections 5.3 and 5.6 hereof, shall be the    
joint and several obligation of the Seller and each of the Companies and for the
benefit of AHI and the Purchaser, on the one hand, and the joint and several    
obligations of AHI and the Purchaser for the benefit of Seller, on the other    
hand. In the case of any breach or other violation of any of the terms and      
provisions of this Agreement, AHI or the Purchaser may seek to enforce any      
remedy against any or all of the Seller and the Companies as AHI or the         
Purchaser shall determine in their sole discretion with respect to any breach or
violation by Seller or any of the Companies, and Seller may seek to enforce any 
remedy against AHI or the Purchaser in its sole discretion with respect to any  
breach or violation by AHI or the Purchaser. None of the provisions of this     
Agreement shall give rise to any right of action by or for the Seller, and the  
Seller shall not have any rights, against any of the Companies or any of the    
Company Subsidiaries if a remedy is sought or obtained against the Seller       
because any one or more Companies breaches any representation, warranty,        
covenant or agreement set forth herein.                                         

5.6 Tax Matters                                                     

         (a) The Seller shall be responsible for, and shall pay or cause to be
paid, and shall indemnify and hold the Companies, the Company Subsidiaries, AHI,
the Purchaser, and their Affiliates and successors (the "Purchaser Indemnified  
Parties") harmless from and against any and all Taxes that may be imposed on or 
assessed against them on account of Taxes imposed upon the Companies or the     
Company Subsidiaries or their assets (i) with respect to all taxable periods    
ended on or prior to the Closing Date (including, but not limited to, the       
contested items set forth on Schedule 4.26, to the extent, but only to the      
extent, such amounts are due and owing), if and to the extent, but only to the  
extent, that the liability for such Taxes exceeds the liabilities or accruals   
taken into account in the preparation of the Closing Date Balance Sheet for     
Taxes relating to such periods; (ii) with respect to any Person other than any  
of the Companies or the Company Subsidiaries arising under Reg. Section 1.1502-6
(or any similar provision or state, local, or foreign law), or as a transferee  
or successor or by contract or otherwise; (iii) with respect to any and all     
Taxes allocated to Seller pursuant to Section 5.6(c) hereof, if and to the      
extent, but only to the extent, that the liability for such Taxes exceeds the   
liabilities or accruals taken into account in the preparation of the Closing    
Date Balance Sheet for Taxes relating to                                        

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such periods; (iv) with respect to any Taxes incurred by or imposed upon any of 
the Companies, the Company Subsidiaries, the Purchaser or AHI in connection with
the transactions contemplated hereby, other than as described in Section 5.6(b);
(v) with respect to Tax liabilities of the Seller and its Subsidiaries (other   
than the Companies or the Company Subsidiaries) arising after the Closing Date, 
(vi) arising from any misrepresentation or breach of warranty contained in      
Sections 2.7 and 4.26 hereof. The Seller shall also pay or cause to be paid and 
shall indemnify and hold harmless the Purchaser Indemnified Parties from and    
against all losses, damages and reasonable third party costs and expenses       
(including reasonable attorney, accountant and expert witness fees and          
disbursements) ("Related Costs") incurred in connection with the Taxes for which
the Seller indemnifies the Purchaser Indemnified Parties pursuant to this       
Section 5.6(a) (or any asserted deficiency, claim demand or assessment,         
including the defense or settlement thereof) or the enforcement of this Section 
5.6(a). Any payment required to made by the Seller pursuant to this Section     
5.6(a) shall be made within 30 days after written notice from the Purchaser.    

         (b) The Purchaser shall be responsible for, and shall pay or cause to
be paid, and shall indemnify and hold the Seller harmless from and against, any 
and all Taxes that may be imposed on or assessed against the Seller on account  
of Taxes imposed on any of the Companies or the Company Subsidiaries or their   
assets (i) for any taxable periods ended on or prior to the Closing Date, if and
to the extent, but only to the extent, that the liability for such Taxes does   
not exceed the liabilities or accruals taken into account in the preparation of 
the Closing Date Balance Sheet for Taxes relating to such periods; (ii) with    
respect to taxable periods of the Companies and the Company Subsidiaries        
beginning after the Closing Date; (iii) that result from the Tax Elections, and 
for any interest and penalties accruing on such Taxes and all costs of defending
against the imposition of such Taxes, but only to the extent that the Taxes     
incurred and actually paid by the Seller or any of the Companies with respect to
the gain allocated to the Seller or any of the Companies on the deemed asset    
sale resulting from the Tax Elections are greater than the Taxes which would    
have been incurred by the Seller or any of the Companies if the Tax Elections   
had not been made; increased by any Tax cost incurred by Seller or any of the   
Companies as a result of the receipt of the indemnity payment and decreased by  
any Tax benefit received by Seller or any of the Companies as a result of the   
receipt of such payment; provided, however, such indemnity shall be reduced     
dollar for dollar by the amount of any Tax benefits obtained by Seller,         
including foreign tax credits, as a result of making the Tax Elections which    
would not have been obtained by the Seller or any of the Companies if the Tax   
Elections had not been made and further, provided, in no event shall Purchaser's
indemnification obligation pursuant to this Section 5.6 exceed $2,000,000,      
provided further that (A) the Seller's utilization of tax loss carryovers, Tax  
credits and other Tax benefits will be verified annually by the third party     
preparer of Seller's tax returns. Such verification will be provided in writing 
to the Purchaser 30 days prior to the actual filing date of Seller's federal    
income tax return. In addition, at the time of issuance of the verification,    
Seller agrees to allow Purchaser and its tax advisors 30 days to review Form    
1118 and all workpapers supporting the Seller's utilization of foreign tax      
credits or other Tax benefits resulting from the Tax Elections. This            
verification process will remain in effect until all such Tax benefits are      
utilized or expire; and (iv) with respect to any and all Taxes allocated to the 
Purchaser pursuant to Section 5.6(c) hereof. The Purchaser shall also pay or    
cause to be paid and shall indemnify and hold harmless the Seller from and      
against all Related Costs of the Seller incurred in connection with the Taxes   
for which the Purchaser indemnifies the Seller pursuant to this Section 5.6(b)  
(or any asserted deficiency,                                                    

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claim, demand or assessment, including the defense or settlement thereof) or the
enforcement of this Section 5.6(b). Any payment required to be made by the      
Purchaser pursuant to this Section 5.6(b) shall be made within 30 days of       
written notice from the Seller.                                                 

        (c) The Companies, the Company Subsidiaries, and the Purchaser shall
close the taxable period of the Companies and the Company Subsidiaries on the   
Closing Date, unless such action is prohibited by law. In any case where        
Applicable Law prohibits any Company or any Company Subsidiary from closing its 
taxable year on the Closing Date, then Taxes, if any, attributable to the       
taxable period of such Company or Company Subsidiary beginning before and ending
after the Closing Date shall be allocated (i) to Seller for the period up to and
including the Closing Date, and (ii) to Purchaser for the period subsequent to  
the Closing Date. For purposes of this Section 5.6(c), Taxes for the period up  
to and including the Closing Date ("Seller's Taxes") shall be determined on the 
basis of an interim closing of the books as of the end of the Closing Date;     
provided, however, that in the case of any Tax not based on income or receipts, 
such Seller's Taxes shall be equal to the amount of such Tax for the taxable    
year multiplied by a fraction, the numerator of which shall be the number of    
days from the beginning of the taxable year through the Closing Date, and the   
denominator of which shall be the number of days in the taxable year.           

         (d) Seller shall be responsible for filing or causing to be filed all
tax returns required to be filed by or on behalf of the Companies and the       
Company Subsidiaries for all periods ending prior to the Closing Date, which tax
returns shall be filed by their due dates after the Closing Date. Seller shall  
provide AHI with a copy of each such tax return at least ten days prior to      
filing. Seller shall file the federal and non-U.S. tax returns (and related     
state returns) for the tax year of Seller that includes the Closing Date        
("Seller's Closing Tax Returns") by or on behalf of the Companies for the period
ending on the Closing Date, which returns shall reflect and include the Tax     
Elections, on or before their due dates and shall provide to the Purchaser, for 
review and approval, pro-forma tax returns of the Companies derived from        
Seller's Closing Tax Returns at least ten (10) days prior to the filing date.   
The Purchaser's approval shall not be unreasonably withheld, and in no event    
shall this section operate to cause any such return to be filed after the due   
date (including any extension thereof) for the filing of such return. Purchaser 
shall be responsible for filing or causing to be filed all tax returns required 
to be filed by or on behalf of the Companies and the Company Subsidiaries after 
the Closing Date. With respect to returns for periods that begin before but end 
after the Closing Date ("Straddle Returns"), the Purchaser shall pay or cause to
be paid all Taxes to which such returns relate for all periods covered by such  
returns; provided, however, that the Seller shall pay to the Purchaser the      
amount determined pursuant to Section 5.6(c) hereof, but only to the extent the 
Seller has an obligation to indemnify the Purchaser for such amounts pursuant to
Section 5.6(a) hereof, not later than fifteen days before the due date for      
payment of Taxes with respect to such tax returns. The Purchaser shall provide  
the Seller with a statement setting forth in reasonable detail the amount, if   
any, payable pursuant to this Section 5.6(d). Seller and its tax advisors shall 
cooperate with Purchaser and its tax advisors from the Closing Date, and shall  
make available all work papers and relevant schedules for the preparation of the
Companies and Company Subsidiaries' tax returns including the Tax Election Form,
the Straddle Returns and Seller's Closing Tax Returns.                          

          (e) The Seller and the Purchaser shall cooperate fully with each other
and make available to each other in a timely fashion such Tax data and other    
information and                                                                 

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personnel as may be reasonably required for the payment of any estimated Taxes  
and the preparation of any tax returns required to be prepared hereunder. The   
Seller and the Purchaser shall make available to the other, as reasonably       
requested, all information, records or documents in their possession relating to
Tax liabilities of the Companies and the Company Subsidiaries for all taxable   
periods thereof ending on, before or including the Closing Date and shall       
preserve all such information, records and documents until the expiration of any
applicable Tax statute of limitations or extensions thereof; provided, however, 
that in the event a proceeding has been instituted for which the information,   
records or documents are required prior to the expiration of the applicable     
statute of limitations such information, records or documents shall be retained 
until there is a final determination with respect to such proceeding.           

        (f) The Purchaser and the Seller shall promptly notify each other in
writing upon receipt by the Purchaser or the Seller, as the case may be, of any 
notice of any tax audits, reviews, examinations, or investigations of or        
assessments against any of the Companies or the Company Subsidiaries for taxable
periods beginning prior to the Closing Date and ending prior to, on or after the
Closing Date (the "Tax Notification Periods"). The failure of one party promptly
to notify the other party of any such audit or assessment shall not forfeit the 
right to indemnity except to the extent that the Seller is materially prejudiced
as a result. The Purchaser shall have the sole right to represent the Companies'
and the Company Subsidiaries' interests in any Tax proceeding relating to such  
tax audits or assessments and to employ counsel of its choice at its expense;   
provided, however, that Seller shall have the right to consult with the         
Purchaser regarding any tax audit or assessment relating to any Tax Notification
Period, and provided further, that any settlement or other disposition of any   
such tax audit or assessment relating to any Tax Notification Period that would 
result in an indemnity payment by the Seller to the Purchaser shall be made     
subject to the consent of the Seller, which consent shall not be unreasonably   
withheld or delayed. The Purchaser, on the one hand, and the Seller, on the     
other, each agree to cooperate fully with the other and its or their respective 
counsel in the defense against or compromise of any claim in any tax proceeding.

 (g) The Seller and the Purchaser agree that any payments made
hereunder (whether made directly to a party or to another indemnitee) will be   
treated by the parties as an adjustment to the aggregate Purchase Price for the 
Securities.                                                                     

        (h) All obligations under this Section 5.6 shall survive the Closing
hereunder and continue until 10 days following the expiration of the statute of 
limitations on assessment of the relevant Tax. Notwithstanding the foregoing,   
any claim for indemnification hereunder shall survive such termination date if, 
prior to the termination date, the party making the claim shall have advised the
other party in writing of facts that may constitute or give rise to an alleged  
claim for indemnification, specifying in reasonable detail the basis under this 
Agreement for such claim.                                                       

        (i) Except as expressly provided in this Section 5.6, any claims for
indemnification made pursuant to this Section 5.6 shall be made in accordance   
with the procedures set forth in Section 5.3(c).                                

5.7 Brazilian Tax-Related Indemnity. Notwithstanding anything to the
contrary contained in this Article V, including without limitation Section 5.6, 
the Seller agrees to be                                                         

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responsible for and shall pay and indemnify and hold harmless the Purchaser     
Indemnified Parties and their respective officers, directors, employees and     
agents from, against and in respect of, the full amount of any and all Losses   
arising from, in connection with, or incident to any Brazilian Tax-Related      
Losses (as hereinafter defined). For purposes of this Agreement, "Brazilian     
Tax-Related Losses" shall mean any Losses incurred, directly or indirectly, by  
the Purchaser Indemnified Parties and their respective officers, directors,     
employees and agents as a result of any tax position taken, or change in tax    
position taken, in or with respect to the Companies' or the Company             
Subsidiaries' operations in Brazil (collectively, the "Brazilian Companies")    
including, but not limited to, value added taxes and similar taxes payable to   
Governmental Authorities in Brazil, and related interest, penalties and other   
charges and shall include, but not be limited to, any diminution in value to the
Brazilian Companies resulting, directly or indirectly, from such changes in tax 
positions, which the parties agree to use their best efforts to quantify prior  
to Closing. The diminution in value of the Brazilian Companies shall be deemed  
to be comprised of all costs or liabilities associated with the following: (i)  
for a period of up to nine (9) months, but in no event longer than is required  
to complete fully the actions listed in (iii) below, the incremental tax owed by
the Brazilian Companies, as a result of being taxed at a rate applicable to     
manufacturing companies rather than service companies, (ii) the shut-down or    
other closure of existing facilities, property, plant and equipment, (iii) the  
opening, construction, lease or other acquisition of replacement facilities,    
property, plant and equipment, and any and all costs and other expenses         
associated with the relocation from one such facility to another such facility, 
and (iv) the profits lost between the shut-down or closure specified in (ii)    
above and the opening set forth in (iii) above. In no event shall the Brazilian 
Tax-Related Losses exceed $5,000,000.                                           

ARTICLE VI. 
 CLOSING; CONDITIONS PRECEDENT; DELIVERIES

      6.1 Closing; Effective Date. Subject to the terms and conditions set forth
herein, the closing of the transactions contemplated by this Agreement (the     
"Closing") shall take place at the offices of Kane Kessler, P.C., 1350 Avenue of
the Americas, New York, New York 10019, on the third business day following the 
date on which the Registration Statement has been declared effective by the SEC 
and all other conditions to Closing have been satisfied or waived by the        
appropriate party or on such other date and at such other place as may be agreed
to by the parties. All proceedings to be taken and all documents to be executed 
at the Closing shall be deemed to have been taken, delivered and executed       
simultaneously, and no proceeding shall be deemed taken nor documents deemed    
executed or delivered until all have been taken, delivered and executed.        

      6.2 Conditions Precedent to the Obligations of AHI and the Purchaser. Each
and every obligation of AHI and the Purchaser to consummate the transactions    
described in this Agreement and any and all liability of AHI and the Purchaser  
to the Seller under this Agreement shall be subject to the fulfillment on or    
before the Closing Date of the following conditions precedent or the waiver     
thereof by AHI and the Purchaser:                                               

   (a) Representations and Warranties True; No Breach. Each of the
representations and warranties of the Seller and the Companies contained herein 
or in any certificate or other document delivered pursuant to this Agreement or 
in connection with the                                                          

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transactions contemplated hereby shall be true and correct in all material      
respects (except to the extent such representations and warranties contain a    
materiality qualification, in which case they shall be true and correct in all  
respects) at and as of the Closing Date (unless made with respect to a          
particular date, then as of such date) with the same force and effect as though 
made on and as of the Closing Date, except for changes contemplated by this     
Agreement.                                                                      

          (b) Performance. The Seller and the Companies shall have performed and
complied in all material respects with each of the agreements, covenants and    
obligations, and delivered all the deliveries, required under this Agreement to 
be performed, complied with, or delivered by them, on or prior to the Closing   
Date.                                                                           

         (c) Certain Financial Matters. The Seller shall have delivered to the
Purchaser the audited balance sheets and the audited statements of income, cash 
flows, and retained earnings of the Companies on a combined basis and           
consolidated with the Company Subsidiaries as of and for the fiscal year ended  
December 31, 2000, including the notes thereto and the reports thereon (without 
qualification) of the Seller's independent auditors, which shall not differ in  
any material respect from the Financial Statements for the fiscal year ended    
December 31, 2000 attached hereto as part of Schedule 4.12 (except as set forth 
in Schedule 6.2(c)). In addition, if the Closing occurs on or after May 15,     
2001, the Seller shall have delivered to the Purchaser an unaudited balance     
sheet (showing the Tangible Net Assets as calculated in accordance with Section 
2.3 hereof) and statement of income of the Companies on a combined basis and    
consolidated with the Company Subsidiaries as of and for the three month period 
ended March 31, 2001. If the Closing occurs on or after August 15, 2001, the    
Seller shall have delivered to the Purchaser an unaudited balance sheet (showing
the Tangible Net Assets as calculated in accordance with Section 2.3 hereof) and
statement of income of the Companies on a combined basis and consolidated with  
the Company Subsidiaries as of and for the six month period ended June 30, 2001.
The Seller and the Sellers accountants, at AHI's expense with respect to any    
such quarterly and six month financial statements, shall have reviewed such     
balance sheets and statements of income and advised AHI and the Purchaser in    
writing that they (a) have been prepared in accordance with the books of account
and records of the Companies, (b) fairly present in all material respects the   
Companies' financial condition and the results of its operations and cash flows 
at the dates and for the periods specified in those statements, and (c) have    
been prepared in accordance with GAAP consistently applied with prior periods.  

        (d) Seller's and Companies' Certificates. The Seller and each of the
Companies shall have delivered to AHI and the Purchaser (i) a certificate, dated
the Closing Date and signed on behalf of such Company by each such Company's    
president or chief executive officer, certifying (x) that the conditions        
specified in Sections 6.2(a), (b), (f), (g) and (h) have been fulfilled in all  
material respects (except to the extent any such section contains a materiality 
qualification, in which case it shall have been fulfilled in all respects), and 
as to such other matters as Purchaser may reasonably request and (ii) a         
certificate of the secretary of the Seller and each of the Companies attesting  
the names and true signatures of the officers of the Seller and each of the     
Companies authorized to execute this Agreement and each other document,         
instrument, or certificate to be delivered pursuant hereto, together with the   
true signature of each such officer (the "Seller's Officers' Certificates").    

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          (e) Chief Financial Officers' Certificates. The Seller and each of the
Companies shall have delivered to AHI and the Purchaser a certificate, dated the
Closing Date and signed on behalf of the Seller by the Seller's chief financial 
officer, certifying that there has occurred no Material Adverse Change (the     
"Seller's Chief Financial Officers' Certificates"). The Chief Financial Officer 
of the Seller, on behalf of the Seller, shall have delivered to AHI and the     
Purchaser a certificate stating that, to his knowledge after reasonable inquiry 
of the responsible officers of the Seller and after giving effect to the        
transactions contemplated hereby, on the Closing Date the Seller is able to pay 
its debts as they mature and the transfer of the Securities by the Seller to the
Purchaser and the consummation of the transactions, in accordance with the terms
of this Agreement, will not render Seller insolvent and is not a transfer in    
fraud of any creditor under applicable federal or state solvency law.           

          (f) No Litigation; Applicable Law. No litigation, arbitration or other
legal or administrative proceeding shall have been commenced or be pending by or
before any Governmental Authority which enjoins or prohibits, or seeks to enjoin
or prohibit, the consummation of all or any of the transactions contemplated by 
this Agreement; no Applicable Law of any Governmental Authority shall have been 
enacted after the date of this Agreement which would prohibit the consummation  
of any or all of the transactions contemplated by this Agreement; and no        
judicial or administrative decision shall have been rendered which enjoins or   
prohibits, or seeks to enjoin or prohibit, the consummation of all or any of the
transactions contemplated by this Agreement.                                    

          (g) Governmental Permits and Approvals. The Seller shall have obtained
all permits, approvals, authorizations, consents, waivers, and novations of any 
Governmental Authority as may be required to consummate the transactions        
contemplated by this Agreement.                                                 

(h) Consents. The Seller shall have obtained all material   
authorizations, consents, waivers and approvals as may be required to consummate
the transactions contemplated by this Agreement including, but not limited to,  
any required consents of any of the landlords to the Leased Property which is   
required in accordance with the terms of the Leases, and consent of a third     
party required with respect to any Material Agreement.                          

         (i) Opinion of Counsel. AHI and the Purchaser shall have received (i)
a favorable opinion letter from Kramer Levin Naftalis & Frankel LLP, legal      
counsel to the Seller, addressed to AHI and the Purchaser and dated the Closing 
Date, in a form reasonably acceptable to AHI and the Purchaser (the "Kramer     
Levin Naftalis & Frankel LLP Opinion") and (ii) such favorable opinion letters  
from counsel to each of the Companies and the material Company Subsidiaries and 
their respective material Subsidiaries as AHI and the Purchaser shall reasonably
request, addressed to AHI and the Purchaser, and dated the Closing Date, opining
as to the Companies and the Company Subsidiaries in France, Mexico, Brazil, and 
Columbia as to valid issuance of securities, and good standing and valid        
existence (if applicable in the jurisdiction of formation), and that no material
Governmental Authorizations are required to be obtained that have not been      
obtained with respect to the consummation of the transactions contemplated      
hereby, and otherwise in a form reasonably acceptable to AHI and the Purchaser. 

    (j) Bring Down Execution Date Legal Opinion. A letter of Squire,
Sanders & Dempsey L.L.P., dated as of the Closing Date, in form and substance   
reasonably satisfactory to                                                      

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AHI and the Purchaser, reaffirming their opinion as set forth in the Execution  
Date Legal Opinion (the "Bring Down Execution Date Legal Opinion").             

        (k) Confidentiality and Non-competition Agreement. (i) Messrs. Jules
Kroll and Wilfred O'Gara shall have entered into the Confidentiality and        
Non-competition Agreement substantially in the form of Exhibit 1 hereto (the    
"Confidentiality and Non-competition Agreements"); and (ii) Thomas O'Gara has   
executed and delivered a Restrictive Covenant Agreement as of the date hereof   
for the benefit of AHI and the Purchaser (the "Thomas O'Gara Agreement"), and   
the Seller agrees that it will not, and will cause its Affiliates not to, pay   
any amounts owed by the Seller, the Companies, the Company Subsidiaries, or     
their respective Affiliates to Thomas O'Gara (other than severance obligations) 
if Thomas O'Gara has breached or threatened to breach the Thomas O'Gara         
Agreement, or if AHI or the Purchaser has notified the Seller in writing of any 
such breach or threatened breach.                                               

(l) [Intentionally Omitted]                                 

   (m) Intellectual Property Assignments. The Purchaser shall have
received the executed Intellectual Property Assignments.                        

         (n) Release by Jules Kroll, and Wilfred O'Gara. Each of Messrs. Jules
Kroll and Wilfred O'Gara shall execute a release, substantially in the form of  
Exhibit 2 hereto unconditionally and irrevocably releasing and forever          
discharging, effective as of the Closing Date, each of the Companies, the       
Company Subsidiaries, and the officers, directors, employees, agents, and       
Affiliates of the Companies and the Company Subsidiaries, from any and all      
Claims relating to the Companies and the Company Subsidiaries which ever existed
or now exist, by reason of any tort, breach of contract, violation of law or    
other act or failure to act which shall have occurred at or prior to the Closing
Date, or in relation to any other liabilities of the Companies and the Company  
Subsidiaries to Jules Kroll or Wilfred O'Gara (the "Principal Stockholder       
Releases").                                                                     

   (o) Fairness Opinions. The Board of Directors of AHI shall have
received the Purchaser's Fairness Opinion. The Board of Directors of the Seller 
shall have received the Seller's Fairness Opinion and the Bring Down Fairness   
Opinion.                                                                        

       (p) Registration Statement Effective. If any portion of the Closing
Payment is to be paid in Consideration Shares, the Registration Statement shall 
have been declared effective by the SEC and shall be effective as of the Closing
Date and no stop order with respect thereto shall have been issued or           
threatened, and the Consideration Shares shall have been listed for trading on  
the New York Stock Exchange, subject to official notice of issuance.            

         (q) Good Standing. Each of the Companies and the Company Subsidiaries
shall be in good standing (where applicable) in its respective jurisdiction of  
incorporation or formation.                                                     

      (r) Subsidiary Guarantees. Each of the Subsidiaries of the Seller,
other than the Companies and the Company Subsidiaries, shall have executed and  
delivered a subordinated guaranty agreement in favor of AHI and the Purchaser   
("Subsidiary Guarantees") guaranteeing all of the liabilities and obligations of
the Seller hereunder, which guarantees shall be in form                         

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and substance reasonably acceptable to such Subsidiaries of the Seller executing
a Subsidiary Guarantee, AHI, the Purchaser, Seller, Seller's senior lender, the 
holders of Seller's senior notes, prospective lenders of Seller and the         
respective counsel to each of the foregoing.                                    

  (s) No Shareholder Approval Required. The laws of the state of
incorporation of the Seller shall not require the consent of the shareholders of
the Seller for the consummation of the transactions contemplated hereby;        
provided however that if the Seller chooses to seek the approval of its         
shareholders of this Agreement or the transactions contemplated hereby as a     
result of either (i) the issuance of an order by a Governmental Authority       
enjoining the consummation of the transactions contemplated hereby by reason of 
the failure of the Seller to obtain the approval of its shareholders of this    
Agreement and the transactions contemplated hereby or (ii) the inability of the 
Seller to deliver the Bring Down Closing Date Legal Opinion due to a change in  
Ohio law, such shareholder approval shall have been obtained.                   

    (t) Bank Approval. AHI and the Purchaser shall have received all
consents with respect to this Agreement and the transactions contemplated hereby
required pursuant to the terms of the Credit Agreement, dated as of February 12,
1999, among AHI, First Union National Bank, SunTrust Bank, North Florida, N.A., 
and The Several Lenders from Time to Time Parties Thereto, Nationsbank, N.A., as
Documentation Agent, and Canadian Imperial Bank of Commerce, as Administrative  
Agent, as amended, and the other agreements and documents entered into in       
connection therewith (the "Bank Consents").                                     

        (u) HSR and Non-U.S. Anti-Trust Law Approval. The applicable waiting
period under the HSR Act shall have expired or been terminated and any waiting  
period shall have expired or been terminated, or any necessary consent shall    
have been granted, under any Non-U.S. Anti-Trust Law.                           

         (v) Subsidiary Transfers. The Company Subsidiary Transfers shall have
been completed in form and substance reasonably satisfactory to the Purchaser.  

       (w) Escrow Agreement. The Seller shall have entered into the Escrow
Agreement.                                                                      

          (x) Russian Licenses. The Seller shall have caused each of O'Gara-Hess
& Eisenhardt CIS, O'Gara Security Systems, Inc., and O'Gara Laura Automotive    
(Russia) to transfer to a designee of the Purchaser all licenses, permits and   
similar consents issued to them with respect to the armoring of vehicles (the   
"Russian Licenses") if the Russian Licenses are transferable and, if the Russian
Licenses are not transferable, to cancel, rescind or terminate the Russian      
Licenses.                                                                       

         (y) Subsidiary in Mexico. The Seller, at AHI's sole cost and expense,
shall have used its commercially reasonable efforts to take all actions and sign
all documents as are reasonably necessary in order to form a S.A. de C.V. in    
Mexico that is a direct, wholly-owned subsidiary of O'Gara-Hess & Eisenhardt    
Armoring Company and to cause such S.A. de C.V. to enter into a contract with   
The O'Gara Company, Mexico S.A. de C.V. for the provision of employees.         

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     6.3 Conditions Precedent to the Obligations of the Seller. Each and every
obligation of the Seller to consummate the transactions described in this       
Agreement and any and all liability of the Seller to AHI and the Purchaser under
this Agreement shall be subject to the fulfillment on or before the Closing Date
of the following conditions precedent or the waiver thereof by the Seller:      

        (a) Representations and Warranties True. Each of the representations
and warranties of AHI and the Purchaser contained herein or in any certificate  
or other document delivered pursuant to this Agreement or in connection with the
transactions contemplated hereby shall be true and correct in all material      
respects (except to the extent such representations and warranties contain a    
materiality qualification, in which case they shall be true and correct in all  
respects) at and as of the Closing Date (unless made with respect to a          
particular date, then as of such date) with the same force and effect as though 
made on and as of the Closing Date, except for changes contemplated by this     
Agreement.                                                                      

   (b) Performance. AHI and the Purchaser shall have performed and
complied in all material respects with each of the agreements, covenants and    
obligations required under this Agreement to be performed or complied with by   
AHI and the Purchaser on or prior to the Closing Date.                          

       (c) Officers' Certificate. Each of AHI and the Purchaser shall have
delivered to the Seller (i) a certificate, dated the Closing Date and signed by 
each such company's president or chief executive officer, certifying that the   
conditions specified in Sections 6.3(a) and (b) above have been fulfilled and   
(ii) a certificate of the secretary of each such company attesting the names and
true signatures of the officers of AHI and the Purchaser authorized to execute  
this Agreement and each other document, instrument, or certificate to be        
delivered pursuant hereto, together with the true signature of each such officer
(the "Purchaser's Certificates").                                               

          (d) No Litigation; Applicable Law. No litigation, arbitration or other
legal or administrative proceeding shall have been commenced or be pending by or
before any Governmental Authority, and no Applicable Law of any Governmental    
Authority shall have been enacted after the date of this Agreement which would  
prohibit the consummation of any or all of the transactions contemplated by this
Agreement, and no judicial or administrative decision, shall have been rendered 
which enjoins or prohibits, the consummation of all or any of the transactions  
contemplated by this Agreement; provided that Seller shall not use any order    
restraining or enjoining the consummation of the transaction primarily as a     
result of Seller's failure to obtain approval of its shareholders to such       
transaction as a basis for terminating this Agreement in order to avoid the     
payments required of Seller by Section 6.9(d).                                  

        (e) Consents. AHI and the Purchaser shall have obtained all material
authorizations, consents, waivers and approvals as may be required by them to   
consummate the transactions contemplated by this Agreement.                     

         (f) Fairness Opinion. The Board of Directors of the Seller shall have
received the Seller's Fairness Opinion and the Bring Down Fairness Opinion.     

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      (g) Opinion of Counsel. The Seller shall have received a favorable
opinion letter from Kane Kessler, P.C., legal counsel to the AHI and the        
Purchaser, addressed to the Seller and dated the Closing Date, in the form      
reasonably acceptable to the Seller (the "Kane Kessler Opinion").               

     (h) HSR Approval. The applicable waiting period under the HSR Act
shall have expired or been terminated.                                          

       (i) Registration Statement Effective. If any portion of the Closing
Payment is to be paid in Consideration Shares, the Registration Statement shall 
have been declared effective by the SEC and shall be effective as of the Closing
Date and no stop order with respect thereto shall have been issued or           
threatened, and the Consideration Shares shall have been listed for trading on  
the New York Stock Exchange, subject to official notice of issuance.            

        (j) Shareholder Approval. If the Seller chooses to seek the approval
of its shareholders of this Agreement or the transactions contemplated hereby as
a result of either (i) the issuance of an order by a Governmental Authority     
enjoining the consummation of the transactions contemplated hereby by reason of 
the failure of the Seller to obtain the approval of its shareholders of this    
Agreement and the transactions contemplated hereby or (ii) the inability of the 
Seller to deliver the Bring Down Closing Date Legal Opinion due to a change in  
Ohio law, such shareholder approval shall have been obtained.                   

6.4 Execution Date Deliveries by the Seller and the Companies.      
Concurrently with the execution and delivery of this Agreement by the Seller and
the Companies, the Seller and the Companies shall deliver to AHI and the        
Purchaser the Execution Date Legal Opinion.                                     

6.5 Closing Date Deliveries by the Seller and the Companies. At the 
Closing, the Seller and/or the Companies shall deliver the following documents  
to AHI and the Purchaser:                                                       

         (a) the certificates representing the Securities, together with stock
powers duly executed in blank, and certificates evidencing 100% of the capital  
stock of the Company Subsidiaries issued in the name of the Companies and/or a  
designee of AHI;                                                                

      (b) a certificate, dated the Closing Date, of the Secretary of the
Seller and each of the Companies, setting forth the authorizing resolutions     
adopted by the Seller's and each Company's Board of Directors with respect to   
the transactions contemplated hereby;                                           

         (c) the written resignations of each of the directors and officers of
each of the Companies and the Company Subsidiaries, effective upon Closing;     

       (d) the minute books of the Companies and the Company Subsidiaries,
including corporate seals, unissued stock certificates, stock registers,        
certificates of incorporation, bylaws and corporate minutes, and other formation
and organizational documents, certified by the Secretaries of the Companies and 
the Seller;                                                                     

      (e) certificates issued by the Secretary of State or other similar
appropriate governmental department, as to the good standing (or similar        
certificate) of each of the Companies and the Company Subsidiaries in its       
jurisdiction of incorporation or formation and                                  

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certifying its certificate of incorporation or formation documents, as the case 
may be, as amended to date; provided, however, no such certificate shall be     
required for any Company Subsidiary if its jurisdiction of incorporation or     
formation does not provide in the normal course for the issuance of such a      
certificate.                                                                    

  (f) the consents or other permits, waiver, licenses or similar
documents referred to in Sections 6.2(g) and (h) hereof;                        

(g) the Confidentiality and Non-competition Agreements;     

(h) the Seller's Officers' Certificates;                    

(i) the Seller's Chief Financial Officer's Certificates;    

(j) the Kramer Levin Naftalis & Frankel LLP Opinion;        

(k) the Bring Down Execution Date Legal Opinion;            

(l) the Seller's Fairness Opinion;                          

(m) the Principal Stockholder Releases;                     

(n) the Subsidiary Guarantees;                              

(o) the Intellectual Property Assignments; and              

 (p) such other documents and instruments as the Purchaser may
reasonably request.                                                             

    6.6 Closing Date Deliveries by AHI and/or the Purchaser. At Closing, AHI
and/or the Purchaser shall deliver the following documents and funds to the     
Seller:                                                                         

          (a) a wire transfer of funds (provided that the Seller shall, at least
two business days prior to Closing, have furnished appropriate wire             
instructions) to the Seller in the aggregate amount of the Cash at Closing;     

(b) certificates representing the Consideration Shares;     

         (c) a certificate of the Secretary of State of the State of Delaware,
as of a recent date, as to the good standing of AHI and the Purchaser and       
certifying their respective certificates of incorporation;                      

          (d) a certificate, dated the Closing Date, of the Secretary of AHI and
the Purchaser, setting forth the authorizing resolutions adopted by AHI and the 
Purchaser's Board of Directors with respect to the transactions contemplated    
hereby;                                                                         

(e) the Purchaser's Certificates;                           

(f) the Kane Kessler Opinion; and                           

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         (g) such other documents and instruments as the Seller may reasonably
request;                                                                        

  6.7 Best Efforts. Subject to the terms and conditions provided in this
Agreement, each of the parties shall use their respective best efforts in good  
faith to take or cause to be taken as promptly as practicable all reasonable    
actions that are within its power to cause to be fulfilled those of the         
conditions precedent to its obligations or the obligations of the other parties 
to consummate the transactions contemplated by this Agreement that are dependent
upon its actions, including obtaining all necessary consents, authorizations,   
orders, approvals and waivers.                                                  

6.8 Termination.                                                    

      (a) This Agreement and the transactions contemplated hereby may be
terminated:                                                                     

          (i)       at any time by the mutual consent of the Seller, the
Companies, Purchaser, and AHI;  

        (ii)      by AHI or the Purchaser at any time at or prior to
    Closing in their sole discretion if:

                   (1) any of the representations or warranties of the
Seller or any of the Companies in this Agreement are not true, accurate and     
complete in all material respects (except to the extent such representations and
warranties contain a materiality qualification, in which case they shall be true
and correct in all respects) and such breach, if curable, is not cured by the   
Termination Date;                                                               

                       (2) the Seller, its Subsidiaries, any of the Companies,
or any of the Company Subsidiaries materially breaches any covenant contained in
this Agreement and such breach, if curable, is not cured by the Termination     
Date;                                                                           

                      (3) any of the conditions precedent to the Purchaser's
obligations to conduct the Closing have not been satisfied by the date required 
thereof;                                                                        

                      (4) any legal proceeding is commenced or threatened by
any governmental agency or other person directed against the consummation of the
Closing or any other transaction contemplated hereby, and either AHI or the     
Purchaser reasonably and in good faith deems it impractical or inadvisable to   
proceed in view of such legal proceeding or threat thereof;                     

      (5) the Bank Consents are not granted;

                   (6) the Closing has not occurred on or prior to the
Termination Date due to the failure of any consents or authorizations required  
under the HSR Act to be granted or otherwise.                                   

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                       (7) AHI and the Purchaser's due diligence investigation
of the Companies and the Company Subsidiaries shall not have been completed to  
their satisfaction, in their sole and complete discretion, with respect to any  
Closing occurring after September 14, 2001 due to the election of the Seller to 
seek the approval of its shareholders of this Agreement or the transactions     
contemplated hereby.                                                            

             (iii)     by the Seller at any time at or prior to Closing in its
sole discretion if:             

                   (1) any of the representations or warranties of the
Purchaser in this Agreement are not true, accurate and complete in all material 
respects (except to the extent such representations and warranties contain a    
materiality qualification, in which case they shall be true and correct in all  
respects) and such breach, if curable, is not cured by the Termination Date;    

                   (2) if AHI or the Purchaser materially breaches any
covenant contained in this Agreement and such breach, if curable, is not cured  
by the Termination Date;                                                        

               (3) any of the conditions precedent to Seller's
obligations to conduct the Closing have not been satisfied by the date required 
thereof;                                                                        

                      (4) if the Closing has not occurred on or prior to the
Termination Date due to the failure of AHI to obtain the Bank Consents or the   
failure of any consents or authorizations required under the HSR Act to be      
granted; or                                                                     

                       (5) If the Seller accepts any Acquisition Proposal, has
terminated this Agreement in writing and has paid the Break-up Fee and          
Purchaser's Transactions Expenses.                                              

     (b) If this Agreement is terminated pursuant to this Section 6.8,
written notice thereof shall promptly be given by the party electing such       
termination to the other party and, this Agreement shall terminate without      
further actions by the parties and, except as set forth in Section 6.9, no party
shall have any further obligations under this Agreement. Notwithstanding the    
preceding sentence, the provisions of Sections 7.3, 7.6(c) and (d), 7.7, 7.8,   
8.8, 8.14, 8.15, and 8.18 shall survive the termination of this Agreement.      

6.9   Liquidated Damages and Break-up Fees.                         

          (a) If AHI and Purchaser elect to terminate this Agreement pursuant to
Section 6.8(a)(ii)(7) or in accordance with Section 6.8 on account of (i) the   
occurrence or existence of a Material Adverse Change, (ii) a material breach of 
a representation or warranty by the Seller or any Company, or Seller elects not 
to close based on the failure of the condition precedent set forth in Section   
6.3(d) (unless due to any of the reasons set forth in Section 6.3(j)), then     
Seller shall promptly pay to AHI and the Purchaser upon notice thereof to the   
Seller, all of AHI's and the Purchaser's out of pocket costs and expenses       
incurred in connection with this Agreement and the transactions contemplated    
hereby, including without limitation the fees of all their advisers (including  
accountants, attorneys, environmental consultants, financial advisors,          
investigators, investment bankers and tax consultants and the expenses of such  
advisers billable to AHI and/or the Purchaser), and travel expenses             
("Transaction Expenses").                                                       

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          (b) If the Seller or any Company (i) materially breaches a covenant or
agreement set forth in Section 7.1, 7.2, 7.6(c) (other than Thomas O'Gara), 7.12
(the last sentence), 7.13(b), 7.14, 7.15, 7.17 or 7.19, (ii) fails to provide   
the Bring Down Execution Date Legal Opinion, (iii) chooses to seek shareholder  
approval and such shareholder approval is not obtained, (iv) fails to receive   
the Bring Down Fairness Opinion, or (v) if the audited Financial Statements for 
the fiscal year ended December 31, 2000, shall be materially different from the 
unaudited Financial Statements for the fiscal year ended December 31, 2000      
attached hereto as Schedule 4.12 (except as set forth in Schedule 6.2(c)), and  
AHI and Purchaser elect to terminate this Agreement in accordance with Section  
6.8, Seller shall promptly pay to AHI and the Purchaser shall be entitled to    
receive, promptly upon notice thereof to the Seller:                            

         (i)       AHI's and the Purchaser's Transaction Expenses; and

          (ii)      liquidated damages in the amount of Two Million Five
                        Hundred Thousand and 00/100 ($2,500,000.00) Dollars (the
"Liquidation Damage Amount").   

        (c) If the Closing does not occur on account of any reason set forth
in paragraph (b) above, and within 18 months after the termination of the       
Agreement by AHI and the Purchaser, the Seller enters into an agreement for an  
Acquisition Proposal with any other person then the Seller shall promptly pay to
AHI and/or the Purchaser, in addition to the Liquidated Damage Amount payable   
under paragraph (b) above, an additional fee of One Million Five Hundred        
Thousand and 00/100 ($1,500,000.00) Dollars (the "Additional Break-up Fee").    

         (d) If the Closing does not occur because the Seller or the Companies
or any controlled affiliates of the Seller or any Company have entered into an  
agreement for an Acquisition Proposal with any other person and terminates this 
Agreement in accordance with Section 6.8 then the Seller shall promptly pay to  
AHI and/or the Purchaser:                                                       

         (i)       The Transaction Expenses of AHI and Purchaser; plus

(ii)      $4,000,000 (the "Break-Up Fee")           

          (e) Payment by Seller of the Transaction Expenses, Liquidation Damages
Amount, Break-up Fee and Additional Break-up Fee as the case may be as required 
by paragraphs (a) through (d) above, shall be in lieu of, and shall fully       
satisfy and discharge, any claims for damages by AHI or the Purchaser in        
connection with such matters, excluding damages in connection with a claim of   
fraud.                                                                          

ARTICLE VII.
COVENANTS AND OTHER AGREEMENTS

7.1 Interim Operations of the Seller, the Companies and the Company 
Subsidiaries.                                                                   

 (a) During the period from the date of this Agreement to, and
including, the Closing Date, except with Purchaser's prior specific written     
consent, or as required or contemplated by Sections 7.15 and 7.18, or as        
otherwise expressly contemplated by this                                        

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Agreement, the Companies and the Company Subsidiaries shall, and the Seller     
shall cause the Companies and the Company Subsidiaries to, operate their        
respective businesses only in the ordinary and usual course consistent with past
practices and to use reasonable efforts to preserve intact their business       
organization and good will in all material respects, including without          
limitation the good will and relationships of the Companies' and the Company    
Subsidiaries' customers, suppliers, employees and vendors. Additionally, during 
the period from the date of this Agreement to the Closing Date, the Companies   
and the Company Subsidiaries shall not, and the Seller shall cause the Companies
and the Company Subsidiaries not to, do any of the following (unless otherwise  
expressly contemplated by this Agreement or permitted in writing by Purchaser): 

       (i)       amend their respective certificate or articles of
                      incorporation or bylaws or code of regulation or other
       formation and organizational documents;

              (ii)      issue, sell or authorize for issuance or sale, shares of
                        any class of their respective securities (including, but
                     not limited to, by way of stock split or dividend) or
               any subscriptions, options, warrants, rights or
                       convertible securities, or enter into any agreements or
                      commitments of any character obligating it to issue or
sell any such securities;       

        (iii)     redeem, purchase or otherwise acquire, directly or
                    indirectly, any shares of their capital stock or any
                     option, warrant or other right to purchase or acquire
any such capital stock;         

             (iv)      declare or pay any dividend or other distribution other
                    than between and among the Companies and the Company
                       Subsidiaries (whether in cash, stock or other property)
    with respect to their capital stock;

       (v)       voluntarily sell, transfer, surrender, abandon or
                   dispose of any of their material assets or property
                  rights (tangible or intangible), other than in the
                ordinary course of business consistent with past
                     practices, and provided that any such sale, transfer,
                 surrender, abandonment or disposition which would
                        otherwise be in the ordinary course of business does not
violate this Agreement;         

            (vi)      grant or make any mortgage or pledge or subject itself
                        or any of its properties or assets to any Encumbrance of
                      any kind, except liens for Taxes not currently due and
                      Permitted Encumbrances not incurred in connection with
borrowed money;                 

            (vii)     create, incur or assume any liability or indebtedness,
                   except trade indebtedness in the ordinary course of
        business consistent with past practices;

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              (viii)    create, incur or assume (1) any account or note payable,
                       in excess of $300,000 individually (without Purchaser's
                        consent which shall not be unreasonably withheld) or (2)
                   accounts or notes payable that exceed the amount of
                      accounts or notes payable as of March 31, 2001 by more
than $3.4 million.              

     (ix)      make or commit to make any capital expenditures
              exceeding Fifty Thousand Dollars ($50,000.00),
                     individually, or One Million Dollars ($1,000,000), in
the aggregate.                  

(x)       become subject to any Guaranty;           

       (xi)      apply any of its assets to the direct or indirect
                    payment, discharge, satisfaction or reduction of any
                   amount payable directly or indirectly to or for the
                       benefit of the Seller or any Affiliate of the Seller or
                  any Related Party or to the prepayment of any such
                    amounts, other than expenses payable in the ordinary
                   course of business to the Seller or scheduled lease
              payments under Leases listed on Schedule 4.16;

          (xii)     grant any increase in the compensation payable or to
                  become payable to directors, officers or employees
                 (including, without limitation, any such increase
                       pursuant to any bonus, pension, profit-sharing or other
                plan or commitment), except for annual raises to
                       employees other than executive officers in the ordinary
                  course of business consistent with past practices;

      (xiii)    except as listed on Schedule 7.1, enter into any
                       agreement which would be a Material Agreement, or amend
                      or terminate any existing Material Agreement, which is
                       outside the ordinary course of business consistent with
                  past practices. With respect to the foregoing, the
                      Seller shall provide Purchaser with a complete list of
                      any such Material Agreements entered into, amended, or
                        terminated between the date hereof and the Closing Date;

          (xiv)     alter the manner of keeping their books, accounts or
               records, or change in any manner the accounting
practices therein reflected;    

         (xv)      except as set forth on Schedule 7.1, enter into any
                    commitment or transaction other than in the ordinary
                  course of business consistent with past practices;

         (xvi)     do any act, or omit to do any act, or permit to the
                   extent within the Seller's, or any Company's or any
                     Company Subsidiary's, control, any act or omission to
                       act which would cause a material violation or breach of
                      any of the representations, warranties or covenants of
                    the Seller or any of the Companies set forth in this
                     Agreement or cause any representation or warranty set
forth herein, or in any         

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                     certificate or other document delivered in connection
                     herewith, to be untrue in any material respect on the
Closing Date;                   

        (xvii)    take any action which has or could have a Material
Adverse Effect;                 

          (xviii)   alter in any manner any of the Companies' or Company
                     Subsidiaries' existing working capital facilities, or
                        prepay any debt other than a mandatory prepayment in the
ordinary course of business;    

             (xix)     transfer, directly or indirectly, in any way, any cash,
                    cash equivalents, securities, or other assets to the
                        Seller, or for the benefit of the Seller, including, but
                      not limited to, by way of dividend, loan, repayment of
                       indebtedness, payment of fees, or other distribution or
                   transfer except as expressly permitted by the terms
   hereof (including Schedule 7.1); or

              (xx)      agree, whether in writing or otherwise, to do any of the
foregoing.                      

 (b) During the period from the date of this Agreement to, and
including, the Closing Date, the Seller shall not sell or transfer any its      
assets, or otherwise take any action, if, under the laws of the state of        
incorporation of the Seller, such sale, transfer, or action would have the      
effect of requiring the shareholders of the Seller to approve, or making it more
likely that the shareholders of the Seller would be required to approve, the    
transactions contemplated hereby.                                               

7.2 Access. The Seller shall, and shall cause the Companies and the 
Company Subsidiaries to, afford to AHI and the Purchaser and their agents and   
representatives, access throughout the period prior to the Closing Date to the  
properties, books, records, contracts and all other information and documents   
concerning its business, assets, liabilities, properties, and personnel of the  
Companies and the Company Subsidiaries, for the purpose of permitting AHI and   
the Purchaser to fully investigate and perform a due diligence review of the    
Companies and the Company Subsidiaries, their respective businesses, assets and 
properties, and financial condition, provided that such access shall be granted 
upon reasonable notice during normal business hours in such a manner as to not  
unreasonably interfere with the Companies' and the Company Subsidiaries' normal 
business operations. During such period the Seller shall furnish promptly to    
Purchaser copies of all material correspondence received or sent by or on behalf
of any of the Companies or the Company Subsidiaries from or to any Governmental 
Authority.                                                                      

    7.3 Confidentiality (through Closing Date). Except as otherwise required
in the performance of obligations under this Agreement and except as otherwise  
required by law, any non-public information received by a party or its advisors 
from the other party shall be kept confidential and shall not be used or        
disclosed for any purpose other than in furtherance of the transactions         
contemplated by this Agreement. Such confidential information includes, without 
limitation, audited and unaudited financial statements that show the Companies' 
and the Company Subsidiaries' current and projected costs, and detailed         
financial information supporting such statements. Neither AHI nor the Purchaser 
shall use (or permit to be used) any confidential information in any manner to  
compete against Seller or any of the Companies or the Company                   

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Subsidiaries, whether with respect to corporate acquisitions, sales, financing, 
development, management, investment, or otherwise. The obligation of            
confidentiality shall not extend to information (a) which is or shall become    
generally available to the public other than as a result of an unauthorized     
disclosure by a party to this Agreement or a person to whom a party has provided
such information, (b) which was available to a party to this Agreement on a     
nonconfidential basis prior to its disclosure by one party to the other pursuant
to this Agreement as evidenced by such other party's records on the date of such
disclosure, (c) was independently developed by Purchaser or (d) which is        
disclosed by Purchaser in any legal proceeding requiring any such disclosure.   
Upon any termination of this Agreement, each party shall promptly return any    
confidential information received from the other party and, upon request, shall 
destroy all copies of such information in its possession. The covenants of the  
parties contained in this Section 7.3 shall survive any termination of this     
Agreement until the earlier of (i) three (3) years from the date hereof, or (ii)
the date when such information becomes generally available to the public, but   
shall terminate at the Closing, if it occurs, with respect to information       
concerning the Companies and the Company Subsidiaries.                          

    7.4 Notification. Each party to this Agreement shall promptly notify the
other party in writing of the occurrence, or pending or threatened occurrence,  
of any event that would constitute a material breach or violation of this       
Agreement by any party or that would cause any representation or warranty made  
by the notifying party in this Agreement to be false or misleading in any       
respect (including without limitation, any event or circumstance which would    
have been required to be disclosed on any schedule to this Agreement had such   
event or circumstance occurred or existed on or prior to the date of this       
Agreement). Any such notification shall not limit or alter any of the           
representations, warranties or covenants of the parties set forth in this       
Agreement nor any rights or remedies a party may have with respect to a breach  
of any representation, warranty or covenant.                                    

7.5 Acquisition Proposals; No Solicitation. In consideration of the 
substantial expenditure of time, effort, and expense undertaken by AHI and the  
Purchaser in connection with the negotiation and execution of this Agreement,   
the Seller and the Companies, jointly and severally, agree that unless this     
Agreement has been terminated by the mutual agreement of the parties, neither   
the Seller, nor any of the Companies nor the Company Subsidiaries, nor their    
respective Affiliates, representatives, employees or agents (collectively,      
"Agents") will, between the date hereof and the Closing, directly or indirectly,
(i) solicit, encourage, negotiate, or accept any proposal (whether solicited or 
unsolicited) for, or execute any agreement relating to, a sale of all or any    
part of the Securities, the Companies, or the Company Subsidiaries, or their    
respective assets or a sale of any equity or debt security of the Seller or any 
of the Companies or the Company Subsidiaries or any merger, consolidation,      
combination, recapitalization, sale of any asset or other transaction involving 
any of the Companies or the Company Subsidiaries with any other party (any of   
the foregoing is referred to as an "Acquisition Proposal"), or (ii) provide any 
information regarding any of the Companies or the Company Subsidiaries to any   
third party for the purpose of soliciting, encouraging or negotiating an        
Acquisition Proposal (it being understood that nothing contained in clauses (i) 
or (ii) above shall restrict the Seller or any of its Agents from providing     
information as required by legal process). In addition, the Seller and each of  
the Companies shall promptly notify the Purchaser in writing of any third       
party's Acquisition Proposal, or communication in connection with any potential 
Acquisition Proposal, to the Seller or any of the Companies, together with all  
relevant terms and conditions thereof.                                          

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7.6 Non-competition and Non-disparagement.                          

         (a) For purposes of this Section 7.6, all references to the Companies
shall be deemed to include all of the Company Subsidiaries and successors and   
assigns of the Companies and the Company Subsidiaries, and all references to the
Seller shall be deemed to include the Seller on behalf of itself and all of its 
Subsidiaries which are not one of the Companies or the Company Subsidiaries. The
Seller acknowledges that in order to assure AHI and the Purchaser that AHI and  
the Purchaser will retain the value of the Companies as a "going concern," the  
Seller, on and subject to the terms set forth in this Section 7.6, shall not    
utilize its special knowledge of the business of the Companies and its          
relationships with customers, prospective customers, suppliers and others to    
compete with any of the Companies. For a period of five (5) years beginning on  
the Closing Date, the Seller and its Affiliates shall not engage or have an     
interest, anywhere in the United States of America or any other geographic area 
where any of the Companies does business or in which any of the Companies'      
products are marketed, alone or in association with others, as principal,       
officer, agent, employee, director, partner or stockholder (except as an owner  
of two percent (2%) or less of the stock of any company listed on a national    
securities exchange or traded in the over-the-counter market), or through the   
investment of capital, lending of money or property, rendering of services or   
capital, or otherwise, in any business involving, relating or similar to,       
directly or indirectly, the business of any of the Companies. During the same   
period, the Seller and its controlled Affiliates shall not, and shall not permit
any of their employees, agents or others then under their control to, directly  
or indirectly, on behalf of the Seller, its controlled Affiliates, or any other 
Person, (i) call upon, accept competitive business from (as defined below), or  
solicit the competitive business of any Person who is, or who had been at any   
time during the preceding three (3) years, a customer, known prospective        
customer, or supplier of any of the Companies or (ii) recruit, employ, or       
otherwise solicit or induce any person who is an employee or consultant of, or  
otherwise engaged by any of the Companies to terminate his or her employment or 
other relationship with any of the Companies, or such successor, or hire any    
person who has left the employ of the Companies, or any such successor during   
the preceding two (2) years. The Seller and its Affiliates shall not at any     
time, directly or indirectly, use or purport to authorize any Person to use any 
name, mark, copyright, logo, trade dress or other identifying words or images   
which are the same as or similar to those used currently or in the past by any  
of the Companies in connection with any product or service, whether or not such 
use would be in a business competitive with that of the Companies. The Seller   
acknowledges that compliance with the restrictions set forth in this Section    
7.6(a) will not prevent it from earning a livelihood. As used herein, the phrase
"competitive business" means any business competitive with the type of business 
engaged in by the any of the Companies as of the date hereof. Notwithstanding   
anything contained in this Section 7.6(a), (i) nothing shall prevent the Seller 
or any of its Subsidiaries from providing consulting and other services relating
to executive protection and security/threat assessment or from using the phrase 
"risk mitigation" in connection with the promotion, marketing and sale of their 
products and services, and (ii) nothing shall prevent O'Gara-Hess & Eisenhardt  
CIS, O'Gara Laura Automotive (Russia), and OSS (Russia) from providing armoring 
services in Russia.                                                             

         (b) Each of AHI, Purchaser, on behalf of itself and their Affiliates,
agree that for a period of 18 months after the date hereof it will not solicit  
American International Group ("AIG") as a customer for its kidnap and ransom    
services; provided, that such restriction shall terminate upon the sale of all  
or substantially all of the assets of AIG, the sale of the capital stock        

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of AIG such that the existing shareholders of AIG do not own at least 50% of the
capital stock of AIG immediately after such sale, the merger of AIG with and    
into another entity in which AIG is not the surviving entity or whereby AIG's   
existing shareholders do not own at least 50% of the surviving entity, and shall
not apply to any Person which is currently a customer of AHI, the Purchaser or  
any of the Companies or the Company Subsidiaries if such Person is acquired by  
or merged into AIG.                                                             

        (c) The Seller, on behalf of itself and its officers, directors, and
Subsidiaries, agrees not to make or cause to be made, directly or indirectly,   
any disparaging or derogatory statements concerning any of the Companies, AHI,  
the Purchaser, their Affiliates, their respective businesses, services,         
reputations, or prospects, or their respective past or present officers,        
directors, employees, attorneys, and agents.                                    

         (d) AHI and the Purchaser, on behalf of themselves and their officers
and directors, agree not to make or cause to be made, directly or indirectly,   
any disparaging or derogatory statements concerning the Seller and its          
Subsidiaries (other than the Companies and the Company Subsidiaries) their      
respective businesses, services, reputations, or prospects, or their respective 
past or present officers, directors, employees, attorneys, and agents.          

7.7 General Confidentiality.                                        

        (a) For purposes of this Section 7.7(a), all references to AHI shall
be deemed to include all of AHI's Affiliates and Subsidiaries, including the    
Purchaser, each of the Companies and the Company Subsidiaries. The Seller       
acknowledges that the intangible property and all other confidential or         
proprietary information with respect to the business and operations of AHI are  
valuable, special and unique assets of AHI. The Seller shall not, at any time   
after the Closing Date, disclose, directly or indirectly, to any Person, or use 
or purport to authorize any Person to use any confidential or proprietary       
information with respect to AHI, whether or not for the Seller's own benefit,   
without the prior written consent of AHI or unless required by law, including   
without limitation, (i) trade secrets, designs, formulae, drawings, intangible  
property, diagrams, techniques, research and development, specifications, data, 
know-how, formats, marketing plans, business plans, budgets, strategies,        
forecasts and client data; (ii) information relating to the products developed  
by AHI, (iii) the names of AHI's customers and contacts, AHI's marketing        
strategies, the names of AHI's vendors and suppliers, the cost of materials and 
labor, the prices obtained for goods or services sold (including the methods    
used in price determination, manufacturing and sales costs), lists or other     
written records used in AHI's business, compensation paid to employees and      
consultants and other terms of employment, production operation techniques or   
any other confidential or proprietary information of, about or pertaining to the
business of AHI, and any other confidential or proprietary information and      
material relating to any customer, vendor, licensor, licensee, or other party   
transacting business with AHI, (iv) all tangible material that embodies any     
confidential and proprietary information as well as all records, files,         
memoranda, reports, price lists, drawings, plans, sketches and other written and
graphic records, documents, equipment, and the like, relating to the business of
AHI, and (vi) any other confidential information or trade secrets relating to   
the business or affairs of AHI which the Seller may acquire or develop in       
connection with or as a result of the performance of his or its performance of  
the terms and conditions of this Agreement, excepting only such information as  
is already known to the public or which may become known to the                 

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public without any fault of the Seller or in violation of any confidentiality   
restrictions. The Seller acknowledges that AHI and the Purchaser would not enter
into this Agreement without the assurance that all such confidential and        
proprietary information will be used for the exclusive benefit of AHI.          

         (b) For purposes of this Section 7.7(b), all references to the Seller
shall be deemed to include all of the Seller's Subsidiaries other than the      
Companies and the Company Subsidiaries. AHI and the Purchaser acknowledge that  
the intangible property and all other confidential or proprietary information   
with respect to the business and operations of the Seller are valuable, special 
and unique assets of the Seller. AHI and the Purchaser shall not, at any time   
after the Closing Date, disclose, directly or indirectly, to any Person, or use 
or purport to authorize any Person to use any confidential or proprietary       
information with respect to the Seller, whether or not for their own benefit,   
without the prior written consent of the Seller or unless required by law,      
including without limitation, (i) trade secrets, designs, formulae, drawings,   
intangible property, diagrams, techniques, research and development,            
specifications, data, know-how, formats, marketing plans, business plans,       
budgets, strategies, forecasts and client data; (ii) information relating to the
products developed by the Seller, (iii) the names of the Seller's customers and 
contacts, the Seller's marketing strategies, the names of Seller's vendors and  
suppliers, the cost of materials and labor, the prices obtained for services    
sold (including the methods used in price determination, manufacturing and sales
costs), lists or other written records used in the Seller's business,           
compensation paid to employees and consultants and other terms of employment,   
production operation techniques or any other confidential or proprietary        
information of, about or pertaining to the business of the Seller, and any other
confidential or proprietary information and material relating to any customer,  
vendor, licensor, licensee, or other party transacting business with the Seller,
(iv) all tangible material that embodies any confidential and proprietary       
information as well as all records, files, memoranda, reports, price lists,     
drawings, plans, sketches and other written and graphic records, documents,     
equipment, and the like, relating to the business of the Seller, and (vi) any   
other confidential information or trade secrets relating to the business or     
affairs of the Seller which AHI or the Purchaser may acquire or develop in      
connection with or as a result of the performance of his or its performance of  
the terms and conditions of this Agreement, excepting only such information as  
is already known to the public or which may become known to the public without  
any fault of AHI or the Purchaser or in violation of any confidentiality        
restrictions. AHI and the Purchaser acknowledge that the Seller would not enter 
into this Agreement without the assurance that all such confidential and        
proprietary information will be used for the exclusive benefit of the Seller.   

      7.8 Continuing Obligations; Equitable Remedies. The restrictions set forth
in Sections 7.6 and 7.7 are considered by the parties to be reasonable for the  
purposes of protecting the value of the business and goodwill of the Seller, the
Companies, the Company Subsidiaries, AHI, and the Purchaser. AHI and Purchaser  
and the Seller acknowledge that the Seller, AHI, and the Purchaser would be     
irreparably harmed and that monetary damages would not provide an adequate      
remedy to the aggrieved party in the event the covenants contained in Sections  
7.5, 7.6 and 7.7 were not complied with in accordance with their terms.         
Accordingly, the Seller, on the one hand, and AHI and the Purchaser on the      
other, agree that any breach or threatened breach by any of them of any         
provision of Sections 7.5, 7.6 or 7.7 shall entitle the other to injunctive and 
other equitable relief to secure the enforcement of these provisions, in        
addition to any other remedies (including damages) which may be available. If   
the Seller breaches the covenant set                                            

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forth in Section 7.6, the running of the five (5) year non-compete period       
described therein shall be tolled for so long as such breach continues. It is   
the desire and intent of the parties that the provisions of Sections 7.5, 7.6,  
and 7.7 be enforced to the fullest extent permissible under the laws and public 
policies of each jurisdiction in which enforcement is sought. If any provisions 
of Sections 7.5 and 7.6 relating to the time period, scope of activities or     
geographic area of restrictions is declared by a court of competent jurisdiction
to exceed the maximum permissible time period, scope of activities or geographic
area, as the case may be, the time period, scope of activities or geographic    
area shall be reduced to the maximum which such court deems enforceable. If any 
provisions of Section 7.6 or 7.7 other than those described in the preceding    
sentence are adjudicated to be invalid or unenforceable, the invalid or         
unenforceable provisions shall be deemed amended (with respect only to the      
jurisdiction in which such adjudication is made) in such manner as to render    
them enforceable and to effectuate as nearly as possible the original intentions
and agreement of the parties. In addition, if any party brings an action to     
enforce Sections 7.3, 7.5, 7.6 or 7.7 hereof or to obtain damages for a breach  
thereof, the prevailing party in such action shall be entitled to recover from  
the non-prevailing party all attorney's fees and expenses incurred by the       
prevailing party in such action.                                                

  7.9 Change of Name. Within ten days of Closing, Seller and each of its
direct and indirect subsidiaries shall use their commercial reasonable efforts  
to file a doing business or equivalent certificate under a name that does not   
include O'Gara or words similar to or susceptible of confusion with O'Gara in   
all jurisdictions in which it is qualified to do business. Within 90 days       
following the Closing Date, Seller shall change its name and the names of all   
its direct and indirect Subsidiaries to remove the words "O'Gara" or words      
similar to or susceptible to confusion with "O'Gara", by amendment of its       
certificate of incorporation.                                                   

      7.10 Advice of Changes. Until the Closing, the Seller and the Companies on
the one hand and AHI and the Purchaser on the other will immediately provide the
other parties hereto written notice in reasonable detail of any fact or         
occurrence or any pending or threatened occurrence with respect to its          
obligations hereunder of which any of them obtains knowledge which (i) if       
existing and known as of the date of this Agreement, would have been required to
be set forth or disclosed pursuant to this Agreement, (ii) if existing and known
at any time prior to or at the Closing, would make the performance by any party 
of a covenant contained herein impossible or make that performance materially   
more difficult, (iii) if existing and known at the time of Closing, would cause 
a condition to any party's obligations under this Agreement not to be satisfied,
(iv) results in a breach of any representation, warranty, covenant, or agreement
of the Seller or the Companies set forth in this Agreement or any document or   
certificate executed in connection herewith, or (v) would cause the Tangible Net
Assets to be less than the Minimum Tangible Net Assets.                         

   7.11 Maintenance of Insurance. To the extent Seller or its Subsidiaries
obtains insurance covering any violations of Environmental and Safety           
Requirements, the Seller and its Subsidiaries shall name AHI and the Purchaser  
as an additional insured and a loss payee under such policy.                    

     7.12 Sale of the French Carosserie. If, prior to the first anniversary of
the Closing Date, the Purchaser shall sell, agree to sell, or liquidate (the    
"Carosserie Sale") the French division of the Companies, known as the French    
Carosserie and its related service businesses                                   

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(the "Carosserie"), the Purchaser shall remit to the Seller an amount equal to  
67% of the proceeds of the Carosserie Sale, less (i) U.S.$1,779,000,            
representing the portion of the Purchase Price attributable to the purchase of  
the Carosserie as a part of the transactions contemplated hereby, (ii) any      
expenses incurred by the Purchaser or any of its Affiliates in connection with  
the Carosserie Sale, (iii) working capital and other capital investments in the 
French Carosserie made by or on behalf of the Purchaser, and (iv) the amount of 
any liabilities of the French Carosserie not assumed (including severance pay to
Carosserie employees) by the purchaser in the Carosserie Sale. The Seller and   
the Companies, on behalf of themselves and their controlled Affiliates, agree   
that prior to the Closing they shall not without the prior consent of the       
Purchaser (i) make any announcement to any employees of any of O'Gara France    
S.A., O'Gara-Hess & Eisenhardt France S.A. (formerly known as Labbe S.A.),      
Hellio Poids Lourds-Carosserie, Tolene, Peinture S.A., SARL Normandie           
Carosserie, Societe de Blindage et de Securite, Essonne Carosserie VI S.A.R.L.  
(formerly known as M.C.P.L., S.A.) concerning the transactions contemplated     
hereby, any or potential sale or closing of the Carosserie or (ii) terminate the
employment of any person employed by the Carosserie as of the date hereof.      
Announcements permitted pursuant to Section 8.18 shall not be deemed a violation
of this Section 7.12.                                                           

7.13 Registration Statement.                                        

     (a) AHI and the Seller shall use their respective best efforts to
file, as soon as practical after the date hereof, with the SEC under the        
Securities Act a registration statement on Form S-3 covering the resale by the  
Seller of the Consideration Shares (the "Registration Statement") and shall use 
their respective best efforts to cause the Registration Statement to be declared
effective on or prior to the Closing Date and to cause the Consideration Shares 
to be admitted for trading on the New York Stock Exchange upon official notice  
of issuance on or prior to the Closing.                                         

          (b) The Seller shall furnish all information concerning the Seller, or
Subsidiaries of the Seller, including the Companies and Company Subsidiaries, or
their respective officers and directors, including financial statements, as may 
be required by the Securities Act, as may be requested by the SEC or as AHI may 
reasonably request in connection with the preparation of the Registration       
Statement. None of the information supplied by the Seller for inclusion or      
incorporation by reference in the Registration Statement shall at the time the  
Registration Statement is filed with the SEC, at the time the Registration      
Statement becomes effective, or at the time any post-effective amendment thereto
becomes effective contain any untrue statement of a material fact or omit to    
state any material fact required to be stated therein or necessary in order to  
make the statements therein, in light of the circumstances under which they are 
made, not misleading. If at any time any event or circumstance relating to the  
Seller, or any Subsidiary of the Seller, including the Companies and Company    
Subsidiaries, or their respective officers or directors, should be discovered by
the Seller that should be set forth in an amendment or supplement to the        
Registration Statement, the Seller shall promptly inform AHI.                   

     (c) The Seller shall indemnify and hold harmless AHI for any Loss
incurred by AHI should any information provided by the Seller for inclusion or  
incorporation by reference in the Registration Statement ("Seller Information") 
contain any untrue statement ("Seller Information") of a material fact or omit  
to state any material fact required to be stated therein or necessary in order  
to make the statements therein, in light of the circumstances under which they  

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are made, not misleading. AHI shall indemnify and hold harmless the Seller for  
any Loss incurred by the Seller should the Registration Statement, except for   
the Seller Information, contain any untrue statement of a material fact or omit 
to state any material fact required to be stated therein or necessary in order  
to make the statements therein, in light of the circumstances under which they  
are made, not misleading.                                                       

   7.14 HSR Application. The Seller, the Companies, AHI, and the Purchaser
shall                                                                           

        (a) Take promptly all actions necessary to make the filings required
of them or any of their Affiliates under the HSR Act or any Non-U.S. Anti-Trust 
Law.                                                                            

    (b) Comply at the earliest practicable date with any request for
additional information or documentary material received by the Seller, the      
Companies, and AHI or any of their Affiliates from the FTC or the DOJ pursuant  
to the HSR Act or from any state Attorney General or other Governmental         
Authority in connection with antitrust matters.                                 

         (c) Cooperate with each other in connection with any filing under the
HSR Act or any Non-U.S. Anti-Trust Law and in connection with resolving any     
investigation or other inquiry concerning the transactions contemplated hereby  
commenced by the FTC, DOJ, any state Attorney General or any other Governmental 
Authority.                                                                      

(d) Use all commercially reasonable efforts to resolve such 
objections, if any, as may be asserted with respect to the transactions         
contemplated hereby under any antitrust law.                                    

       (e) Advise the other parties promptly of any material communication
received by such party from the FTC, DOJ, any state Attorney General or any     
other Governmental Authority regarding any of the transactions contemplated     
hereby, and of any understandings, undertakings or agreements (oral or written) 
such party proposes to make or enter into with the FTC, DOJ, any state Attorney 
General or any other Governmental Authority in connection with the transactions 
contemplated hereby.                                                            

  (f) Notwithstanding the foregoing or any other covenant herein
contained, in connection with the receipt of any necessary approvals under the  
HSR Act or any Non-U.S. Anti-Trust Law, none of AHI, the Seller, the Companies  
nor any of the Company Subsidiaries shall be required to (i) divest or hold     
separate or otherwise take or commit to take any action that limits AHI's or the
Purchaser's freedom of action with respect of, or its ability to retain, the    
Companies or any of the Company Subsidiaries or any material portions thereof or
any of the businesses, product lines, properties or assets of AHI, the          
Purchaser, the Companies or any of the Company Subsidiaries, without AHI's and  
the Purchaser's prior written consent; or (ii) to commence any litigation       
against any entity in order to facilitate the consummation of any of the        
transactions contemplated hereby.                                               

7.15 Transfers of Company Subsidiaries.                             

(a) Prior to the Closing, the Seller shall cause 100% of the
outstanding stock of O'Gara Security International, Inc., ("OSI") to be         
transferred from OHEAC to the Seller or its designee prior to the Closing Date. 

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         (b) Prior to the Closing Date, the Seller shall cause OSA to transfer
to the Seller or its designee Kroll Information Services, Inc. and Kroll-O'Gara 
Crisis Management Group, Inc.                                                   

  (c) Prior to the Closing Date, the Seller shall cause OHEAC to
transfer to the Seller or its designee O'Gara-Hess & Eisenhardt Armoring Company
(England) Limited and O'Gara-Hess & Eisenhardt Armoring Company Limited.        

(d) Prior to the Closing Date, the Seller shall cause O'Gara
Philippines, Inc. to transfer all of its assets to The Kroll-O'Gara Co.         
(Phils.), now known as O'Gara-Hess & Eisenhardt Philippines, and shall cause    
OHEAC to transfer O'Gara Philippines to the Seller or its designee.             

  (e) Prior to the Closing, the Seller shall cause its ownership
interest in S.A.R.L. Essonne Securite to be transferred to the Seller or its    
designee.                                                                       

        (f) Following the actions set forth in Sections 7.15(a) - (e) above,
the Seller shall take all actions necessary, and pay all associated costs,      
expenses, and transfer and excise taxes, so that each Company Subsidiary is a   
direct or indirect wholly-owned by a Company prior to the Closing; provided,    
however, that with respect to any Company Subsidiary which, pursuant to         
Applicable Law, is required to have more than one shareholder, the Seller shall 
take all actions necessary, and pay all associated costs, expenses and transfer 
and excise taxes, so that any shares of such Company Subsidiary not owned by one
of the Companies is transferred to a designee of the Purchaser prior to Closing.
At Purchaser's request, the Determining Accountant may conduct an audit of the  
books of The O'Gara Company de Mexico, S.A. de C.V. to properly allocate        
liabilities between Seller and such Company. The cost of such audit shall be    
shared by Seller and Purchaser. Seller shall assume all such liabilities        
determined to be the obligation of Seller and indemnify AHI and Purchaser       
against such liabilities.                                                       

         (g) The transfers and reorganizations referred to in Sections 7.15(a)
- (e) are referred to herein as the "Company Subsidiary Transfers" and the      
Company Subsidiaries transferred pursuant to Sections 7.15 (a)-(e) are referred 
to herein as the "Transferred Company Subsidiaries".                            

        (h) The Seller shall give the Purchaser reasonable advance notice of
Company Subsidiary Transfers and the transfer of any other Company Subsidiary   
and shall consult in detail with the Purchaser regarding the form and structure 
of such transfers.                                                              

   7.16 Bank Consents. AHI shall use its reasonable best efforts to obtain
the Bank Consents in a timely manner.                                           

7.17 ERISA Actions.                                                 

As of the Closing Date, Seller and the Companies shall have:        

       (a) taken all steps necessary to cause the Companies to cease to be
participating employers under the Kroll-O'Gara Retirement Plan (as amended and  
restated effective January 1 1999) (the " 401(k) Plan") as of the Closing Date; 

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          (b) provided that employees who cease to be eligible to participate in
the 401(k) Plan as a result of the sale of the Companies be fully vested in     
their account balances under the 401(k) Plan as of the Closing Date in          
accordance with the terms of the 401(k) Plan and applicable Treasury regulations
pertaining to the partial termination of a plan intended to be qualified within 
the meaning of section 401(a) of the Code; and                                  

        (c) taken all steps necessary to permit participants affected by the
sale to receive a distribution of their account balances in accordance with and 
to the extent allowed by the exception to the separation from service           
requirement for distributions from plans like the 401(k) Plan set forth in      
section 401(k)(10) of the Code and applicable Treasury regulations.             

  7.18 Inter-company Transfers. Between the date hereof and the Closing,
OHEAC shall be permitted to transfer to the Seller up to a maximum of $50,000   
per week; provided however, that Seller shall refund to the Companies $200,000  
of cash withdrawn from the Companies in April, 2001, or, in lieu thereof,       
refrain from taking any permitted transfer of cash from the Companies during the
four weeks following the date hereof.                                           

      7.19 Assignment of Intellectual Property. At the Closing, the Seller shall
execute, or cause to be executed, assignments in a form acceptable to the       
Purchaser and capable of being recorded with the appropriate Governmental       
Authority sufficient to effect the assignment to the Company, or other Person   
designated by the Purchaser, of all of the Intellectual Property set forth on   
Schedule 4.19, all other Company Intellectual Property, and, if requested by AHI
or the Purchaser, the contracts listed as items 4, 6, 7, and 8 on Schedule 4.14,
to the extent not previously owned, transferred, or assigned to one of the      
Companies (the "Intellectual Property Assignments.")                            

7.20 Aircraft Lease Transfer. Prior to the Closing Date, OHEAC shall
transfer and assign to the Seller the aircraft lease for a Gulfstream G-II      
aircraft owned by Victory Aviation, which was entered into in February 1995 and 
amended effective June 1, 1998 (the "Aircraft Lease Assignment"). To the extent 
that OHEAC has any prepaid amounts with respect to such lease arrangement, such 
amounts shall be a reduction to the calculation of the Closing Date Tangible Net
Assets (the "TNA Aircraft Adjustment").                                         

7.21 Shareholder Approval. If the board of directors of the Seller  
resolves to seek the approval of the shareholders of the Seller with respect to 
this Agreement or the transactions contemplated hereby, the Seller shall notify 
AHI and the Purchaser no later than the next business day after such resolution.

ARTICLE VIII. 
 MISCELLANEOUS

    8.1 Notices. Any notice, demand, claim or other communication under this
Agreement shall be in writing and shall be deemed to have been given upon the   
delivery, mailing or transmission thereof, as the case may be, if delivered     
personally or sent by certified mail, return receipt requested, postage prepaid,
or sent by facsimile or prepaid overnight courier to the parties at the         
addresses set forth below their names on the signature pages of this Agreement  
(or                                                                             

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at such other addresses as shall be specified by the parties by like notice). A 
copy of any notices delivered to Purchaser shall also be sent to (i) Kane       
Kessler, P.C., 1350 Avenue of the America, New York, New York 10019, Attention: 
Robert L. Lawrence, Esq., Fax No. (212) 245-3009. A copy of any notices         
delivered to the Seller shall also be sent to Kramer Levin Naftalis & Frankel   
LLP, 919 Third Avenue, New York, New York 10022, Attention: Peter S. Kolevzon,  
Esq., Fax No. (212) 715-8000.                                                   

8.2 Entire Agreement. This Agreement contains every obligation and  
understanding between the parties relating to the subject matter hereof and     
merges all prior discussions, negotiations and agreements, if any, between them,
and none of the parties shall be bound by any conditions, definitions,          
understandings, warranties or representations other than as expressly provided  
or referred to herein.                                                          

     8.3 Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted     
assigns.                                                                        

   8.4 Assignment. This Agreement may not be assigned by any party without
the written consent of the other party; provided, that AHI and the Purchaser may
assign this Agreement to a corporation, partnership, or limited liability       
company of which either AHI or the Purchaser maintains majority control;        
provided, however, that no such assignment shall relieve AHI or the Purchaser of
any liability hereunder.                                                        

     8.5 Waiver and Amendment. Any representation, warranty, covenant, term or
condition of this Agreement which may legally be waived, may be waived, or the  
time of performance thereof extended, at any time by the party hereto entitled  
to the benefit thereof, and any term, condition or covenant hereof (including,  
without limitation, the period during which any condition is to be satisfied or 
any obligation performed) may be amended by the parties thereto at any time. Any
such waiver, extension or amendment shall be evidenced by an instrument in      
writing executed on behalf of the appropriate party by its President or any Vice
President or other person, who has been authorized by its Board of Directors to 
execute waivers, extensions or amendments on its behalf. Except as otherwise    
expressly provided in this Agreement, no waiver by any party hereto, whether    
express or implied, of its rights under any provision of this Agreement shall   
constitute a waiver of such party's rights under such provisions at any other   
time or a waiver of such party's rights under any other provision of this       
Agreement. No failure by any party thereof to take any action against any breach
of this Agreement or default by another party shall constitute a waiver of the  
former party's right to enforce any provision of this Agreement or to take      
action against such breach or default or any subsequent breach or default by    
such other party.                                                               

     8.6 No Third Party Beneficiary. Except for the provisions of Section 5.4,
nothing expressed or implied in this Agreement is intended, or shall be         
construed, to confer upon or give any Person other than the parties hereto and  
their respective successors and permitted assigns, any rights or remedies under 
or by reason of this Agreement.                                                 

 8.7 Severability. In the event that any one or more of the provisions
contained in this Agreement shall be declared invalid, void or unenforceable,   
the remainder of the provisions of this Agreement shall remain in full force and
effect, and such invalid, void or unenforceable                                 

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provision shall be interpreted as closely as possible to the manner in which it 
was written. It is the desire and intent of the parties that the provisions of  
this Agreement be enforced to the fullest extent permissible under the laws and 
public policies of each jurisdiction in which enforcement is sought. If any     
provision of this Agreement relating to a time period or scope of activities is 
declared by a court of competent jurisdiction to exceed the maximum permissible 
time period or scope of activities, as the case may be, the time period or scope
of activities shall be reduced to the maximum which such court deems            
enforceable.                                                                    

8.8 Fees and Expenses. Except as provided in Section 6.9, each party
agrees to pay, without right of reimbursement from the other party, the costs   
incurred by it incident to the performance of its obligations under this        
Agreement and the consummation of the transactions contemplated hereby,         
including, without limitation, costs incident to the preparation of this        
Agreement, and the fees and disbursements of counsel, accountants and           
consultants employed by such party in connection herewith; provided; however,   
AHI shall pay the Seller's incremental audit costs associated with the audit of 
the Companies' Financial Statements as of and for the years ended December 31,  
1999 and 1998, up to the amount of $60,000 in fees and up to $10,000 in         
reasonable expenses associated therewith. Notwithstanding the foregoing, AHI and
the Seller shall each bear 50% of the fees payable in connection with the filing
required by the HSR Act or any Non-U.S. Anti-Trust Law. No expenses of the      
Seller relating to the transactions contemplated hereby shall be paid by any of 
the Companies or the Company Subsidiaries, but all such fees shall be paid      
directly by the Seller.                                                         

   8.9 Headings; Construction. The section and other headings contained in
this Agreement are for reference purposes only and shall not affect the meaning 
or interpretation of any provisions of this Agreement. Any reference in this    
Agreement to a section, exhibit or schedule shall, unless otherwise expressly   
indicated, refer to a section of or an exhibit or schedule to this Agreement.   

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

 8.11 Time of the Essence. Wherever time is specified for the doing or
performance of any act or the payment of any funds, time shall be considered of 
the essence.                                                                    

8.12 Injunctive Relief. It is possible that remedies at law may be  
inadequate and, therefore, the parties hereto shall be entitled to equitable    
relief including, without limitation, injunctive relief, specific performance or
other equitable remedies in addition to all other remedies provided hereunder or
available to the parties hereto at law or in equity.                            

8.13 Remedies Cumulative. No remedy made available by any of the    
provisions of this Agreement is intended to be exclusive of any other remedy,   
and each and every remedy shall be cumulative and shall be in addition to every 
other remedy given hereunder or now or hereafter existing at law or in equity.  

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 8.14 Governing Law. This Agreement has been entered into and shall be
construed and enforced in accordance with the laws of the State of New York     
without reference to the choice of law principles thereof.                      

8.15 Jurisdiction and Venue. This Agreement shall be subject to the 
exclusive jurisdiction of the state or federal courts sitting in New York       
County, New York. The parties to this Agreement agree that any breach of any    
term or condition of this Agreement shall be deemed to be a breach occurring in 
the State of New York by virtue of a failure to perform an act required to be   
performed in the State of New York and irrevocably and expressly agree to submit
to the jurisdiction of the United States District Court for the Southern        
District of New York or courts of the State of New York for the purpose of      
resolving any disputes among the parties relating to this Agreement or the      
transactions contemplated hereby. The parties irrevocably waive, to the fullest 
extent permitted by law, any objection which they may now or hereafter have to  
the laying of venue of any suit, action or proceeding arising out of or relating
to this Agreement, or any judgment entered by any court in respect hereof       
brought in New York County, New York, and further irrevocably waive any claim   
that any suit, action or proceeding brought in New York County, New York has    
been brought in an inconvenient forum. The parties hereto agree to service of   
process by certified or registered United States mail, postage prepaid,         
addressed to the party in question.                                             

   8.16 Participation of Parties. The parties hereto acknowledge that this
Agreement and all matters contemplated herein, have been negotiated among all   
parties hereto and their respective legal counsel and that all such parties have
participated in the drafting and preparation of this Agreement from the         
commencement of negotiations at all times through the execution hereof.         

 8.17 Further Assurances. The parties hereto shall deliver any and all
other instruments or documents reasonably requested by the other party in order 
to give effect to all of the terms and provisions of this Agreement including,  
without limitation, all necessary stock powers and such other instruments of    
transfer as may be necessary or desirable to transfer ownership of the          
Securities.                                                                     

    8.18 Publicity. No public announcement or other publicity regarding this
Agreement, the transactions contemplated hereby AHI, the Purchaser, the         
Companies, or the Company Subsidiaries shall be made without the prior written  
consent of the AHI and the Seller as to form, content, timing and manner of     
distribution. Notwithstanding the foregoing, nothing in this Agreement shall    
preclude the Seller from making any public announcement or filing required      
pursuant to any federal or state securities laws or stock exchange rules;       
provided that prior to such filing AHI shall be given a reasonable opportunity  
to review and comment on such public announcement or filing.                    

 [Signature pages follow:]

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   In Witness Whereof, the parties hereto have each executed and delivered
this Agreement as of the day and year first above written.                      

Armor Holdings, Inc.                     The Kroll-O'Gara Company               

By: /s/                                  By: /s/                    
        ------------------------------            ------------------------------

   Name: ________________________           Name: ________________________

   Title: ________________________          Title:________________________

Bengal Acquisition Corp.                 O'Gara-Hess & Eisenhardt Armoring      
         Company
By: /s/                                                             
___________________________           By: /s/                 
                                                ------------------------------
Name: ________________________                                      
                                            Name: ________________________

   Title:________________________           Title:________________________

                    The O'Gara Company

                     By: /s/
                                                  ----------------------------

                                              Name: __________________________

                                               Title: __________________________

                                  O'Gara Security Associates, Inc.

                     By: /s/
                                                 -----------------------------

                                              Name: __________________________

                                              Title:__________________________

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘8-K’ Filing		Date		First		Last			Other Filings
		5/15/02		20					10-Q
		12/31/01		20		44			10-K
		9/14/01		16		64
		8/15/01		56
		6/30/01		16		56			10-Q
		5/15/01		56					3,  3/A,  NT 10-Q
Filed on:		4/25/01
		4/24/01		3					10-K
For Period End:		4/23/01		1		2
		4/20/01		2		8
		4/19/01		11
		3/31/01		46		67			10-Q,  NT 10-Q
		12/31/00		11		65			10-K,  NT 10-K
		1/1/00		23		44
		12/31/99		11		79			10-K405,  NT 10-K
		2/12/99		59
		12/31/98		11		79			10-K,  10-K/A,  8-K,  8-K/A
		6/1/98		77
		1/1/98		32
		11/1/96		45
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