Pre-Effective Amendment to Registration of Securities by a Small-Business Issuer — Form SB-2
Filing Table of Contents
Document/Exhibit Description Pages Size
1: SB-2/A Pre-Effective Amendment No. 1 to Form SB-2 114 682K
2: EX-1.1 Underwriting Agreement 37 161K
3: EX-1.2 Form of Underwriter's Warrant 31 82K
4: EX-1.3 Share Deposit Agreement 4 22K
5: EX-1.4 Form of Warrant Agreement 40 102K
6: EX-1.5 Form of Agreement Among Underwriters 10 47K
7: EX-3.1 Articles of Incorporation 9 36K
8: EX-3.2 Bylaws of the Company 34 85K
9: EX-10.1 1996 Stock Option Plan 22 87K
10: EX-10.2 Strategic Alliance Agreement 6 34K
11: EX-10.3 Teaming Agreement 6 33K
12: EX-10.4 Card Access Systems 43 171K
13: EX-10.5 Software Value Added Reseller Agmt. 22 63K
14: EX-10.6 Agreement Bet. Ensec and Port Auth. 119 440K
15: EX-10.7 Agmt. for Purchase and Sale 14 29K
16: EX-10.8 Employment Agreements 11 55K
17: EX-11.1 Statement Regarding Computation 1 10K
18: EX-23.1 Consent of Grant Thornton LLP 1 8K
19: EX-27.1 Financial Data Schedule 2 13K
20: EX-27.2 Financial Data Schedule 2 13K
21: EX-27.3 Financial Data Schedule 2 13K
22: EX-27.4 Financial Data Schedule 2 13K
EX-10.7 — Agmt. for Purchase and Sale
| EX-10.7 | 1st Page of 14 | TOC | ↑Top | Previous | Next | ↓Bottom | Just 1st |
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Exhibit 10.7
Agreement for Purchase and Sale of the Bank
Automation Division of ENSEC ENGENHARIA E
SISTEMAS DE SEGURANCA S.A. and other
covenants made by and between DE LA RUE
INVESTIMENTOS LTDA. and ENSEC
ENGENHARIA E SISTEMAS DE SEGURANCA S.A.
--------------------------------------------
DE LA RUE INVESTIMENOS LTDA., a company established in the city of Rio de
Janeiro, State of Rio de Janiero at Av. Rio Branco, 99 - 15th floor, Federal Tax
No. 43.647.866/0001-00, herein represented by Its Manager Lourdes Helena Moreira
de Carvalho, hereinafter referred to as "DE LA RUE" and ENSEC ENGENHARIA E
SISTEMAS DE SEGURANCA S.A., herein represented by Its Director President Charles
Nelson Finkel, hereinafter referred to as "ENSEC",; WHEREAS ENSEC engages in
various activities including the manufacture and sale of security equipment and
systems and the exclusive representation in Brazil of the bank automation
equipment sold by De La Rue Sistemas Latin American (DLRSLA), also for providing
technical assistance to customers;
WHEREAS DE LA RUE is the holder of 44.7% of the share capital of ENSEC:
WHEREAS ENSEC is no longer interested in continuing with the activities related
to bank automation;
WHEREAS, DE AL RUE in its turn, is interested in as carrying out such activities
independently of ENSEC, the PARTIES (DE LA RUE and ENSEC) have decided upon the
following:
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1. OBJECT OF THE AGREEMENT
-----------------------
1.1 DE LA RUE hereby buys from ENSEC and ENSEC sells to DE LA RUE,
all the equipment and business relating to the bank automation activity,
meaning:
(i) the sale of all equipment and equipment parts listed in Exhibit
I, which is incorporated to this Agreement.
(ii) The assignment of ENSEC's rights resulting from the Distribution
Contract signed with DE La Rue Systems Latin America on 1 September,
1994 (Exhibit III).
(iii) The assignment, as specified hereinbelow, of all contracts ENSEC
has with customers established in Brazil, referring to the activity
being negotiated, whether relating to the sale, installation and
maintenance of equipment, or relating to the providing of technical
assistance. Such contracts are listed in Exhibit II to this Agreement
and this clause refers specifically as much to them as to any other
negotiations in progress between ENSEC and any potential customer and
which may be confirmed in the future.
2. PURCHASE AND SALE OF EQUIPMENT AND PARTS
---------------------------------------
2.1 The sale and transfer from ENSEC to DE LA RUE of the equipment
mentioned in Item 1 (i) and listed in Exhibit I, at present part of the
assets of ENSEC, shall be effective as soon
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as DE LA RUE has established itself in the State of Sao Paulo, ENSEC
undertakes to keep such equipment in its assets and to take care of it as
if it were its owner, until the sale is completed.
2.2 - ENSEC states that it has the full ownership and possession of such
equipment and parts; that such ownership and possession is not subject to
any judicial or nonjudicial claim or lawsuit; that such assets are all that
it actually has in connection with the Bank Automation business and that,
with such assets, De La Rue will be able to continue to operate the said
business, without any break in continuity; that it will carry out the
transfer of the said assets to De La Rue respecting all legal rules
applicable to the transaction, including those of a taxation nature,
undertaking to indemnify De La Rue as explained in Article 5 for any loss
resulting from any claim, lawsuit or proceeding which might arise due to
the nonperformance of any of these representations and warranties.
2.3 The Parties agree that the actual transfer of the equipment and parts
will take place within not more than forty-five (45) days.
3. CONTRACTS
---------
3.1 The assignment of rights of ENSEC under the Distribution Contract
signed with DLRSLA has been effectively
-3-
completed, as per the instrument in Exhibit IV to this Agreement.
3.2 Similarly, all rights of ENSEC under the contracts listed in Exhibit
II have also been transferred to DE LA RUE. Notwithstanding this,
considering that DE LA RUE will have to take steps of a bureaucratic nature
until it is actually installed in Seo Paulo and that the natural agreements
with the different customers will be necessary until the transfer has been
formally effected, the Parties agree that ENSEC will until then continue
attending such contracts normally under the technical supervision of DE LA
RUE, although it is hereby established that payments made thereto as a
result of such contracts, with effect from the date on which this agreement
is signed, shall be effectively due to DE LA RUE and shall be transferred
to DE LA RUE in full, exclusively deducting contributions to the PIS
(Social Development Plan) and to the COFINS (Social Contribution on
Billings), and ISS (Municipal Service Tax) which transfer shall be made
against payment by ENSEC to DE LA RUE of fees for the technical assistance
services that DE LA RUE will provide to ENSEC.
The parties estimate that the formal transfer of all the contracts
mentioned in Exhibit II will take place within ninety (90) days with effect
from the signing of this Agreement. ENSEC undertakes to make its utmost
effort to see that this time limit is respected.
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4. PAYMENT
-------
4.1 The price to be paid by DE LA RUE for the acquisition from ENSEC of
the bank automation business, including equipment and parts, the
contract with DLRSLA and all the prevailing and prospective contracts
with Brazilian customers shall be R$ 5.964.959,00 (five million nine
hundred and sixty-four thousand nine hundred fifty nine reals) and shall
be paid as explained hereinbelow:
- R$ 1.762.480,00 (one million seven hundred and sixty-two thousand four
hundred eighty reais) in cash and against signing of this Agreement;
- R$ 3.235.600,00 (three million two hundred and thirty five thousand
six hundred reals) for the accord and satisfaction to ENSEC of the
shareholding interest of DE LA RUE in its share capital, this amount
being considered according to its corresponding figure in the balance
sheet prepared by the purchaser on October 31, 1995, which will also
take place against the signing of this Agreement;
- R$ 968.879,00 (nine hundred sixty-six thousand eight hundred seventy
nine reais) corresponding to an interest held by ENSEC in the share
capital of DE LA RUE, which payment shall be made when the transfer has
been completed by ENSEC to DE LA RUE of all the equipment, parts and
contracts being negotiated.
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5. GUARANTEES GIVEN BY ENSEC
-------------------------
5.1 ENSEC undertakes, at its own expense, to dismiss, giving them
thirty (30) days prior notice and paying them their labour rights and
the corresponding social security obligations, all its employees
presently working in the bank automation division hereby transferred to
DE LA RUE, to us to enable DE LA RUE to contract them if it wishes, free
of any encumbrance relating to the past.
5.2 ENSEC guarantees to DE LA RUE that no labour liabilities exist with
regard to those employees, and undertakes to answer for any claim which
in the future may be filed against DE LA RUE as successor, consequent on
events which occurred before the actual contracting of those employees
and relating to the time when they had an employment relationship with
ENSEC, directly assuming the payments and, if necessary, compensating DE
LA RUE for any payment which DE LA RUE on such grounds has been obliged
to make, or for any expense, including financial expenses which may be
related thereto. Such compensation shall be made against a communication
in writing from DE LA RUE of the expense or payment made and within a
maximum of ten (10) days from such communication.
5.3 ENSEC represents and warrants to DE LA RUE, undertaking with such
representation and warranty, that it has no fiscal contingencies which
might on any grounds be imposed by the Government on DE LA RUE and
hereby commits itself and undertakes to assume any cost of a
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taxation or social security nature, or with the Mandatory Fund for
Unemployment Benefit (FGTS) which at any time may be imposed on DE LA RUE,
corresponding to acts or facts that occurred before the actual transfer of
the bank automation division to DE LA RUE, undertaking to Indemnify it for
any loss, including of a financial nature which DE LA RUE may sustain as a
result of such acts or facts. This indemnification or compensation shall be
payable by ENSEC to DE LA RUE within ten (10) days of the written
communication which DE LA RUE shall send to it for this purpose.
5.4 ENSEC represents and warrants to DE LA RUE, undertaking with such
representation and warranty, that no claim or debt exists with customers or
suppliers in connection with the contracts to be transferred to DE LA RUE,
including the contract signed with DLRSLA regarding its development in the
period before its actual transfer to DE LA RUE and, as a consequence of
that warranty, undertakes to answer including judicially, for any claim
sent to DE LA RUE which may arise regarding that period and undertakes to
compensate and indemnify DE LA RUE for any expense or loss, including those
of a financial nature, which for such reasons may be imposed on DE LA RUE.
Such indemnification or compensation shall be paid by ENSEC to DE LA RUE
within ten (10) days of the written communication which DE LA RUE shall
send to it for this purpose.
5.5 - De La Rue represents and warrants that ENSEC shall be notified of any
claim referring to the preceding items; that De La Rue shall make its
utmost efforts to discuss such claims
-7-
and to win the disputes and lawsuits deriving therefrom; that Ensec shall
be called upon to take part in all negotiations for settling such claims.
5.6 Whenever after being advised as provided in the preceding items, ENSEC
fails to indemnify or compensate DE LA RUE within the stipulated time
limit, it will be subject to a fine of 10%, in addition to 1% interest per
month applied to the amount charged, which will be price-level restated as
provided in law. If DE LA RUE is forced to go to court to collect its
credit, ENSEC will be responsible for paying the fees of DE LA RUE's
attorneys at the rate of 20% of the amount which it is ordered to pay.
6. TRANSITION PERIOD
-----------------
6.1 The parties estimate that between the signing of this Agreement and
the actual transfer to DE LA RUE of the assets and contracts subject to
this Agreement, at least ninety (90) days will elapse and agree that, in
this period, ENSEC shall continue to manage the businesses on behalf of DE
LA RUE, making, in good faith, every effort it would make if it were in
managing its own business.
6.2 In this period no contract will be terminated (except if it expires),
extended or negotiated by ENSEC, with consulting DE LA RUE and receiving
its consent; no debt shall be pardoned, negotiated or split into
installments, without consulting DE LA RUE and receiving its consent; no
obligation
-8-
shall be assumed, without consulting DE LA RUE and receiving its consent.
7. COMMISSIONS DUE TO ENSEC
------------------------
7.1 During the five (5) years subsequent to the signing of this Agreement,
respecting the limit in Item 7.3, in the sale by DE LA RUE of products
relating to bank automation, ENSEC shall be entitled to the following
commissions:
- 15% in the first year;
- 5% in subsequent years;
7.2 Such commissions shall apply to the net price of the sales made by DE
LA RUE in Brazil (the Territory), other than sales to the Central Bank,
after deducting expenses with freight, commissions and others and all taxes
imposed on the sale, such as Manufacturing Excise Tax (IPI), Sales &
Service Tax (ICMS) and also the Social Development Plan (PIS) and the
Social Security Financing Contribution (COFINS) and any other that may be
imposed and shall be due only after their actual receipt by DE LA RUE.
7.3 Such commissions shall be due up to a maximum equivalent in Reais of
US $2,000,000.00 (two million dollars) converted from dollars to reais at
the day rate on the date the commission is paid. When this limit is
reached, any obligation to pay such commissions on the part of DE LA RUE
shall cease,
-9-
even if the period of five (5) years established in item 7.1 has not ended.
7.4 After the five (5) year period in item 7.1 has ended, the obligation of
DE LA RUE to pay to ENSEC the commissions established herein shall cease
immediately and lawfully, without the need for any notification, even if
they have not reached the amount of US$ 2,000,000.00 (two million dollars),
which should be considered the maximum amount due to ENSEC on these
grounds, its stipulating not representing any obligation or assurance that
such an amount shall be reached.
7.5 After the end of the five (5) year period, therefor, ENSEC shall be the
exclusive creditor of commissions on net prices which have been paid to DE
LA RUE within this period.
7.6 The right to receive commissions refers exclusively to the sale of bank
automation equipment, without affecting service agreements, even if they
are the result of such sales.
7.7 - In order to be entitled to such commissions, Ensec undertakes as
reasonably requested by De La Rue to:
(i) - to advise De La Rue on developments in the bank automation business
in the Territory:
(ii) - to assist De La R in developing contacts and negotiations with
customers, in the Territory:
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(iii) - to guide De La Rue with regard to changes in legislation of the
Territory;
(iv) - to send potential customers to De La Rue;
(v) - to maintain good relationships with customers;
(vi) - to guide De La Rue with regard to its sales policy in the
Territory, transferring to it the experience Ensec has acquired in the
sector, in recent years;
(vii) - to actively provide support to the sales efforts of De La Rue,
informing it about prospective customers;
(viii) - to furnish to De La Rue periodical reports giving information on
the market or any information De La Rue Requests of it.
8. LEASE
-----
8.1 This Agreement includes the obligation assumed by ENSEC to lease to DE
LA RUE and by DE LA RUE to receive in lease, part of the real property
belonging to and occupied by ENSEC, at the above-mentioned address, for a
period of twelve (12) months counted as from 1 January, 1996, extendible
for identical periods, if one of the parties does not advise the other
party in writing of its intention not to extend the lease, giving at least
thirty (30) days notice.
-11-
8.2 ENSEC guarantees that it has the full ownership of the said property
and that it is in a position to lease it to De La Rue and to guarantee to
De La Rue the unquestioned use of the said property, while the lease
persists.
9. EFFECTIVENESS OF THE AGREEMENT
------------------------------
9.1 This Agreement is irrevocable and irreversible and it is considered
that it will produce all its effects as from the date on which it is
signed, regardless of transition periods, for exclusively logistical
reasons, as stipulated above, until the actual transfers of the assets and
rights subject to the Agreement.
9.2 Default of any obligation assumed hereunder shall require the party in
default to indemnify the other party for loss and damages and loss of
profits resulting therefrom, and also to pay a fine of 10% of the value of
the Agreement, if the default prevents it from performing the Agreement, or
of the specific estimated value of the defaulted obligation.
9.3 Any tolerance by either party with regard to the nonperformance of any
of the obligations subject to this Agreement shall not be considered a
waiver of the right to require it at any time, not can it be deemed a
novation or modification of the Agreement.
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Sao Paulo, December 7, 1995
_____________________________
DE LA RUE INVESTIMENTOS LTDA.
_______________________________________
ENSEC ENGENHARIA E SISTEMAS DE SEGURANCA S.A.
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WITNESSES:
--------------------------------
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Dates Referenced Herein
| Referenced-On Page |
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| This ‘SB-2/A’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| Filed on: | | 8/9/96 | | | | | | | None on these Dates |
| | 12/7/95 | | 13 |
| | 10/31/95 | | 5 |
| List all Filings |
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