Attached files
| file | filename |
|---|---|
| 10-K - Boomerang Systems, Inc. | v171138_10k.htm |
| EX-32.2 - Boomerang Systems, Inc. | v171138_ex32-2.htm |
| EX-31.2 - Boomerang Systems, Inc. | v171138_ex31-2.htm |
| EX-31.1 - Boomerang Systems, Inc. | v171138_ex31-1.htm |
| EX-32.1 - Boomerang Systems, Inc. | v171138_ex32-1.htm |
| EX-10.5 - Boomerang Systems, Inc. | v171138_ex10-5.htm |
SHAREHOLDERS
AGREEMENT
TAWREED
COMPANIES REPRESENTATION
AND
BOOMERANG
USA CORP.
Shareholders
Agreement
This
Shareholders Agreement (the "Agreement") is made and entered into on this 18th
day of June 2009 in Abu Dhabi.
BY
& BETWEEN
TAWREED
COMPANIES REPRESENTATION, an establishment licensed under the laws of the
Emirate of Abu Dhabi and the United Arab Emirates and whose principal address is
P.O Box 112358 (hereinafter referred to as the "First Party" which expression
shall where the context permits include its permitted successors and assigns)
represented by its owner Mr. Mohammed At Qubaisi;
AND
BOOMERANG
USA CORP, a company incorporated under the state laws ofthe State of Delaware,
USA whose address is 355 Madison Avenue, Morristown, NJ 07960, USA (hereinafter
referred to as the "Second Party" which expression shall where the context
permits include its permitted successors and assigns) represented by its
Business Development Manager Mr. Woody Nash.
(Each
hereinafter referred to as the "Party" and/or the "Shareholder" or collectively
referred to as the "Parties" and/or the "Shareholders" and/or the
"Partners")
WHEREAS
A) The
First Party is an establishment licensed in the Emirate of Abu Dhabi and is in
the business of company representation and wishes to expand its business in the
Emirate of Abu Dhabi;
B) The
Second Party is in the business of marketing, designing, engineering,
manufacturing, installing, and supporting robotic automation systems, with a
current focus on automated car parking systems and automated self storage
systems, and wishes to incorporate a similar business (hereinafter referred to
as the "Business") in the Emirate of Abu Dhabi with possible additional branches
elsewhere in the UAE (hereinafter referred to as the "Territory");
C) The
Parties wish to engage in a cooperative and collaborative business alliance that
results in enhancing and expanding the Business in the Territory;
D) As a
result, the Parties wish to enter into this Agreement to set out the precise
nature of the relationship between them and address the Parties' respective
duties and obligations together with the financials pertaining to the
Business.
NOW
THEREFORE in consideration of the mutual covenants and agreements contained in
this agreement and other good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged), the Parties agree as
follows:
1.
Preamble and Annexes:
The above
preamble forms an integral part of this Agreement.
2.
Definitions and Interpretations:
2.1 In
this Agreement, unless the context otherwise requires:
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AED
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means
the lawful currency of the UAB
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BUSINESS
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means
the marketing, designing, engineering, manufacturing, installing, and
supporting robotic automation systems, with a current focus on automated
car parking systems and automated self storage systems. and any other
activities related thereto.
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BOOMERANG
PRODUCTS
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means
al1 products manufactured or sold by the Second Party or any of its
affiliates or subsidiaries from time to time;
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COMMERCIAL
COMPANIES
LAW
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means
the UAB Federal Commercial Companies Law No. 8 of 1984 (as
amended);
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COMMENCEMENT
DATE
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means
the date of this Agreement;
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CONFIDENTIAL
INFORMATION
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means
all information passing from one Party to the other Party relating
to the business of the disclosing Party, including but not limited to
trade secrets, know how, techniques, products, business and marketing
plans and projections. arrangements and agreements with third parties,
customer information, formulae, recipes, concepts not reduced to material
form, plans and models but excludes information:
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a.
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which
is in or becomes part of this public domain other than through breach of
this Agreement;
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b.
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which
the receiving Party can prove by contemporaneous written documentation was
already known to it at the time of disclosure by the disclosing Party or
its representatives;
or
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c.
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which
the receiving Party acquires from a third party entitled to disclose
it;
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COMPETENT
AUTHORITIES
COMPANY
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means
the concerned licensing authorities of the Company;
means Boomerang Systems Middle East
LLC;
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FORCE
MAJEURE
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means
any cause preventing either Party from performing any or all of its
obligations which arises from or is attributable to EITHER acts, events,
omissions or accidents beyond the reasonable control of the Party so
prevented including without limitation strikes, lock-outs or other
industrial disputes (whether involving the workforce of the Party so
prevented or of any other Party), act of God, war, riot, civil commotion,
malicious damage, compliance with any law or governmental order, rule,
regulation or direction, accident, breakdown of plant or machinery, fire,
flood, or storm OR war, civil war, armed conflict or terrorist attack,
nuclear, chemical or biological contamination or sonic
boom;
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INTELLECTUAL
PROPERTY
RIGHTS
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means
any current and future intellectual property rights and any similar or
analogous intangible rights and privileges, including but not limited
to:
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a.
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all
rights under patents, utility models, designs, copyrights, Trademarks in
connection with the Products, Services and Know How;
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b.
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copyrights,
trade marks, trade names, domain names, rights in logos and get-up,
inventions, Confidential Information, trade secrets and know-how, patents,
stock pictures, images, utility models, all rights of whatsoever nature in
computer software and data, privacy rights; and
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c.
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any
rights and privileges related to any of the above;
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in
every case in any part of the world and whether or not registered,
including in relation to the above:
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i.
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all
granted registrations and all applications for
registration;
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ii.
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all
renewals, reversions or extensions;
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iii.
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the
right to sue for damages for past infringement; and
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iv.
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all
forms of protection of a similar nature which may subsist anywhere in the
world;
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MEMORANDUM
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means
the memorandum of association of the Company, as the
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OF
ASSOCIATION
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same
may be amended, modified or superseded from time to time in accordance
with the provisions of the Commercial Companies Law and this
Agreement;
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PRODUCTS
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means
any products required by the Company in connection with the
Business;
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TERRITORY
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means
the UAE;
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TRADEMARKIS
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means
the registered trademarks, as well as any trademarks, trade dress,
copyrights, design patents, utility patents and any other forms of
intellectual property rights pertaining thereto; and
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UAE
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means
the United Arab
Emirates.
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2.2 The
headings in this Agreement are for convenience only and will not be used in its
interpretation.
2.3 The
singular includes the plural and vice-versa where the context
requires.
2.4 The
masculine includes the feminine and vice-versa where the context
requires.
2.5 A
reference in this Agreement to any Clause is, except where it is expressly
stated to the
contrary, a reference to such clause of this Agreement.
2.6 Any
reference to any law, order, regulation or other similar instrument shall be
construed as a reference to the law, order, regulation or instrument as amended,
replaced, consolidated or re-enacted.
2.7 Any
reference to this Agreement or to any other document shall include any permitted
variation, amendment or supplement to such document.
2.8 A
reference to a person in this Agreement includes firms, partnerships and
corporations and their successors and permitted assignees or
transferees.
2.9 Any
phrase introduced by the terms "including", "include", "in particular" or any
similar expression shall be construed as illustrative and shall not limit the
sense of the words preceding those terms.
3. The Formation of the Company
3.1 As
soon as practicable, but no more than two (2) months from the execution of this
Agreement, the Parties shall incorporate a limited liability company in the
Emirate of Abu Dhabi under the name of "Boomerang Systems Middle East LLC"
(the "Company") or such other name as may be mutually agreed upon between
the Parties and further approved by the Competent Authorities, to be owned by
the Parties pursuant to Clause 3.6 hereunder. The Company shall obtain branch
licenses in one or more other Emirates as and when decided by the Board and in
conformity with all legal and regulatory requirements.
3.2 The
corporate objects of the Company are as stated in the above preamble to this
Agreement and the Memorandum of Association of the Company attached as Exhibit A
to this Agreement and forming a integral part thereof.
3.3 The
Company shall, at all times, conduct its business affairs honestly and
independently from the respective businesses of the Parties, provided that the
Company may transact business with any Party pursuant to arms length commercial
terms. All Products purchased by the Company shall be Boomerang Products unless
the Second Party is not able to provide a particular Product needed by the
Company.
3.4 The
duration of the Company shall be five (5) years. Such period may be
automatically renewed for similar terms unless any of the Parties notifies the
other Party of his willingness to dissolve the company, within ninety (90) days
before the expiration of the duration of the Company, for reasons that
materially adversely affect the business of the Company and/or materially
adversely affect the Party wishing to terminate the Agreement.
3.5 The
Company's Memorandum of Association will be prepared in line with this Agreement
and in any event will be in a form and substance satisfactory to the Competent
Authorities.
3.6 The
Parties will be the initial Shareholders of the Company and the initial share
capital of the Company shall be One Hundred Fifty Thousand (150.000) Dirhams,
the nominal value of each share being AED 1,000/- (One Thousand UAE
Dirhams) and shall be contributed in cash by the Shareholders as
follows:
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NAME
OF SHAREHOLDER
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INITIAL
CAPITAL SHARE
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First
Party
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51 | % | ||
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Second
Party
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49 | % | ||
3.7 All
profits of the Company shall be shared equally between the Parties (i.e., 50% to
the First Party and 50% to the Second Party). In the event of dissolution of the
Company, the Company's assets shall be divided in the same proportion as
profits.
3.8 Any
changes to the Company's share capital will be in accordance with the provisions
of the Commercial Companies Law and the Memorandum of Association of the
Company. The Company shall be entitled to satisfy any part or all of its working
capital and other financial requirements by way of loans from banks or other
external sources on terms approved by the Board of Directors including but not
limited to loans from one or both Parties.
4.
Management of the Company
4.1 It is
agreed and understood that, to the extent permitted by the applicable laws,
Clause 4 shall be included in the Memorandum of Association of the Company; and
in any event, the Parties hereby agree to abide by said Clause 4.
4.2 The
general business and affairs of the Company shall be managed by a Board of
Directors in accordance with applicable laws and regulations and the Memorandum
of Association of the Company.
4.3 The
formation and operation of the Board of Directors of the Company shall be
governed by the rules and guidelines set forth as follows:
4.3.1
Unless otherwise agreed in writing by each Shareholder, the initial Board of
Directors shall be comprised of four (4) members (each a "Director"). The First
Party and the Second Party shall each appoint two Directors.
4.3.2
Each Party shall have the right in its sole discretion to remove and replace any
Director appointed by it at any time. Appointment (as well as removal and
replacement) shall be made by written notice from the relevant Party to the
Company with a copy to the other Party in accordance with the provisions hereof
and the Memorandum of Association.
4.3.3
Meetings may be called by a Director upon fourteen (14) days prior notice in
writing being given to the other Directors specifying the proposed date, time
and location of the meeting together with the details of the matters to be
discussed. A meeting of the Board may be called at shorter notice if each of the
Directors so agrees in writing. All legitimate business expenses incurred by the
Directors in relation to such meetings shall be borne by the
Company.
4.3.4 A
meeting of the Board shall be held not less than once every six
months.
4.3.5 A
Director shall be considered present at a meeting of the Board of Directors if
he (or she) dials in by telephone or similar technology. All reasonable efforts
will be made to hold meetings at a time that is mutually convenient for
Directors located in different time zones.
4.3.6 A
quorum for purposes of the valid constitution of a meeting of the Board of
Directors of the Company shall be three (3) Directors then in office or their
alternates. T f the presence of a quorum fails, the Board of Directors meeting
shall be reconvened as soon as practicable in accordance with the Memorandum of
Association of the Company and in respect of the same agenda. Each Board meeting
will be chaired in rotation.
4.3.7
Each Director shall be entitled to one vote. Each Director shall have the power
to appoint any other Director to act on his behalf during his absence and at his
discretion to remove such alternate Director and on such appointment being made
the Alternate Director (except as regards the power to appoint an alternate)
shall be subject in all respects to the terms and conditions existing with
reference to the other Directors of the Company and every Alternate Director
while so acting shall exercise and discharge all the functions powers and duties
of the Director whom he represents. Any Director acting as an alternate shall
have an additional vote for every Director for whom he acts as alternate in
addition to any vote to which he may himself be entitled as a Director. Every
appointment and removal of an Alternate Director pursuant to clause 4.3.7 shall
be effected by an instrument in writing signed by the appointer and delivered to
the principal office of the Company for the time being.
4.3.8 All
decisions and resolutions of the Board of Directors shall be passed by unanimous
vote of the Directors present at a duly convened meeting of the Board. A
resolution in writing signed by four (4) Directors shall be as valid and
effective as if it had been passed at a duly convened meeting of the
Board.
4.3.9 The
Board shall ensure that minutes of their meetings and copies of all resolutions
are kept at the head office of the Company.
4.3.1 0
In the event of deadlock, the Parties hereby agree to attempt to find an
amicable solution to such deadlock so as to not hinder the business and
operation of the
Company.
4.3.11
The business and affairs of the Company shall be managed by the Board of
Directors. Subject to any limitations on the duties and authorities of the Board
of Directors set forth under the Commercial Companies Law or other applicable
law and/or the Memorandum-of Association of the Company, the Board of Directors
shall have full power and authority to make all decisions and take all actions
on behalf of the Company (which decisions and actions shall be binding on the
Company and the Parties) including but not limited to the
following:
a) To
mortgage, pledge, charge or otherwise encumber any or all of the Company's
assets;
b) To
give security in the Company's name or guarantee on behalf of the Company any
debt, liability or obligation (including without limitation issuing financial
guarantees on behalf of the Company relating to obligations of other
parties);
c) To
enter into any loan or finance or loan arrangement, on behalf of the Company;
and including, without limitation, seeking and availing of bank loans, credit
facilities, overdrafts, letters of credit, letters of guarantee and all other
facilities and executing all related documents in connection with the
above.
d) To
approve the Company's quarterly budget and commit the Company to any capital
expenditure not pre-authorized in said quarterly budget;
c) To
engage the Company in any binding obligation outside the ordinary course of
business;
f) To
nominate the auditor of the Company for approval by the Parties in accordance
with applicable law;
g) To
open, operate (and close) bank accounts and/or accounts with other financial
institutions, to appoint (or modify) the authorized signatories and signatory
arrangements, in respect of all such accounts of the Company;
h) To
acquire or establish any business additional to the business of the Company or
expand or make any material change to the business of the Company;
i) To
exit any line of Business previously engaged in by the Company,
j) To
take, hold, subscribe for or agree to purchase or acquire shares in the capital
of another company;
k) To
amalgamate or merge the Company with any other business or company;
I) To
implement any proceedings for winding up, reorganizing or dissolving the Company
as decided by the Extra Ordinary General Assembly of the Company;
m) To
define the trading policies of the company, specifically in the form of
materials and consumables purchasing policy;
n) To
alter the arrangements for managing the Company as established by the
Board;
o) To
confirm the appointment of a General Manager, to select and appoint other senior
managers of the Company; and
p) To
issue one or more Powers of Attorney to the General Manager and/or any other
person as and when deemed necessary by the Board.
4.3.12
Without prejudice to Clause 4.3.11 above, the Board shall have the following
specific responsibilities:
a) To
ensure that the Company accounts are maintained in a proper manner, according lo
approved accounting principles, and kept continually up-to-date;
b) To
ensure that within ten (10) days of the end of each month, following the
Commencement Date. each Party is sent a financial statement and management
account, in relation to the business of the Company;
c) To
ensure that, the Company is carried on in a proper, prudent, commercial and
business like manner;
d) To
ensure that the insurable assets of the Company are insured and kept insured
with an insurance company of repute and in their full replacement value, against
all risks that would usually be insured against by the operator of a business
similar to the Company and, in addition, take out indemnity insurance in such
amount and against such risks as the Board, shall think necessary or
prudent;
e) Within
three (3) months of the end of each account reference date, to review, consider
and recommend to the Parties approval of the Company's audited
accounts;
f) To
consider and approve the operating costs of the Company as detailed in the
Company's quarterly budget;
g) To
consider and approve the work programs and budgets to be submitted to the Board
by the General Manager;
h) To
approve the budget for advertising and promotional campaigns and material in
respect of the Company and its services;
5.
General Assembly
5.1
Invitation to and Convening of the General Assembly
The
General Assembly of the Company shall be composed of all the Partners. The
General Assembly is to be convened pursuant to the invitation of the Company's
Board of Directors at least once a year on the date and at the place fixed by
the Board within the four (4) months following the end of the financial
year. The Board is required to convene the General Assembly if
requested to do so by a number of Partners owning no less than one quarter (25%)
of the share capital. The invitations to attend the General Assembly
are to be sent by registered mail with acknowledgment of receipt addressed to
each Partner at least twenty one (21) days prior to the date of the meeting. The
invitations must indicate the details of the agenda and relevant documents, in
addition to the venue, date and time of the meeting. Each Partner is
entitled to attend the General Assembly irrespective of the number of shares he
holds. Any Partner may, pursuant to a proxy, authorize another Partner to
represent him at the General Assembly, and each Partner shall have a number of
votes equal to the number of shares he owns or represents. Any
Partner, which is a company or any other corporate entity, may appoint a duly
authorized representative to attend and vote on its behalf at a General
Assembly.
5.2
Deliberations and Decisions of the General Assembly
The
General Assembly may not deliberate on matters not included in the agenda unless
significant issues are disclosed during the meeting of the General Assembly and
require discussions. If any Partner requests that any specific matter
be included in the agenda, the Board is required to respond to this request
otherwise the relevant Partner may resort to the General Assembly. Each Partner
has the right to discuss the matters included in the agenda, and the Board is
committed to respond to any questions raised by a Partner provided that such
response does not prejudice the Company's interest. If any Partner deems that
the reply is not sufficient, he may resort to the General Assembly whose
decision shall be binding. Minutes shall be recorded containing
sufficient summary of the General Assembly's deliberations which have been
approved. The minutes and decisions of the General Assembly shall be recorded in
a special register kept at the Company's head office. Any Partner may peruse the
register in person or through a proxy. The Partners and their duly authorized
proxies may also peruse the balance sheet, profit and loss account, and the
annual report of the Company. Any decision adopted by the General
Assembly in violation to the provisions of the Commercial Companies Law or the
Memorandum of Association of the Company, benefiting some Partners or causing
damage to other Partners without due regard for the interests of the Company
shall be deemed null and void, without prejudice to any bona fide third parties.
In such case, only the Partners who objected to the said decision or those who
could not object for acceptable reasons may request the cancellation of such
decision.
5.3
Binding Character of General Assembly's Decisions
The
decisions of the General Assembly passed pursuant to the provisions of Federal
Law No. (8) of 1984 Concerning Commercial Companies, as amended, and of the
Memorandum of Association of the Company, shall be binding on all Partners
including those absent or Dissident.
5.4
Ordinary General Assembly
5.4.1
Annual General Assembly
The
agenda for the Annual General Assembly must include the following matters: a)
reviewing and approving the report of the Board of Directors on the activities
and financial accounts of the Company during the year, as well as the auditor's
report;
b)
discussing and approving the balance sheet and the profit and loss
account;
c)
determining the dividends that \\—ill be distributed to the
Partners;
d)
appointing the members of the Board and fixing their remuneration;
and
e)
appointing the Auditors and fixing their remuneration.
5.4.2
Powers of the Ordinary General Assembly
The
Ordinary General Assembly shall be competent to deliberate on the following
matters:
a) to
appoint the Board members and fix their remuneration and powers;
b) to
approve the audited accounts of the Company;
c) to
appoint the Company's Auditors or fix the Company's accounting
policy;
d) to
approve the business plan and/or budget of the Company;
e) to
establish and register branches in the name of the Company; and
f) any
other matter not within the competence of the Extraordinary General Assembly
pursuant to the provisions of the Commercial Companies Law or the memorandum of
Association.
5.4.3
Majority required to pass Resolutions
The
resolutions of the Ordinary General Assembly shall not be valid unless adopted
by a vote of Partners representing at least seventy five percent (75%) of the
share capital of the Company. If the above majority is not achieved at the first
meeting, a second meeting shall be convened during the next twenty one (21) days
following the first meeting and the resolutions shall be passed with a majority
of votes represented therein.
5.5
Extraordinary General Assembly
5.5.1
Powers of the Extraordinary General Assembly
The
Extraordinary General Assembly shall be competent to deliberate on the following
matters:
a)
Increase, reduction or restructuring of the authorized share
capital;
b)
Adopting any resolutions relating to the issuance of shares;
c)
Bringing substantial changes to the nature of the Company's activities or any
branch thereof, including the initiation or termination by the Company or one of
its branches of any substantial activity;
d) Any
merger consolidation or reorganization of the Company with any other
company;
e) Any
other acts concerning the winding up, dissolution and liquidation of the
Company;
f)
Amendment of the Memorandum of Association of the Company;
g)
Amendment of the Company's name, head office or legal form;
h)
Extension of the Company's term; and
i)
Requiring compulsory contributions from the Partners in excess of the
contributions stipulated in the Company's business plan.
5.5.2
Resolutions of the Extraordinary General Assembly
The
resolutions of the Extraordinary General Assembly shall not be valid unless
adopted by a vote of Partners representing one hundred percent (100%) of the
share capital of the Company;
The
unanimous vote of the Partners shall be necessary for any decision increasing
the Partners' liabilities;
Any
decision reducing the capital of the Company shall not be valid unless an
approval thereof is obtained from the competent governmental
departments. In light of the above, the Board is required to notify
all related legal documents and any amendments thereto to the Department of
Planning and Economy in Abu Dhabi.
In any
case, all written resolutions signed by all Shareholders shall be binding on the
Company in the same manner as resolutions adopted at a duly convened General
Assembly.
6.
General Manager
6.1 The
Board shall delegate its powers of management in respect of the day-to-day
management to a General Manager to be appointed in due course. The General
Manager shall at all times be responsible and subject to the control of the
Board. The remuneration of the General Manager shall be decided and annually
reviewed by the Board at the Board's discretion.
6.2 The
General Manager shall be responsible for the day-to-day management of the
Company and he shall have all powers not reserved to the Board. His powers shall
include (but not be limited to) the following:
a)
Establishing and maintaining the Company's accounting systems and financial
controls in connection with the business of the Company and ensuring that the
Company accounts are maintained according to established accounting principles
and practices;
b)
Detell1lining the operating costs and capital requirements of the Company and
preparing work programs and budgets for approval by the Board;
c)
Supervising and controlling the performance by the Company's employees of their
duties and obligations within their respective job descriptions and ensuring
that the Company's assets and finances are sufficiently protected in order to
avoid any mismanagement or misappropriation of funds;
d)
Planning and implementing advertising and promotional campaigns and material in
respect of the Company and its services;
e)
Applying for and obtaining for the Company telephone, facsimile and telex
connections and applying for and obtaining all necessary amenities and
pell1lissions and no objections and approval from all public utilities and
bodies;
f)
Source, approve and maintain all sub-contract requirements;
g) On
behalf of and at the cost of the Company maintaining in force the lease or
leases of premises as required by the Company to carry on its business and for
maintaining its licenses;
h)
Reporting to the Board at its regular meetings and otherwise as and when called
upon to do so.
i)
Communicating to all Directors the substance of what is communicated about the
Company to any other Director(s).
j)
Engaging and dismissing employees of the Company;
k)
Signing, filing, delivering and submitting application forms and other document~
to the Department of Immigration and Naturalization for the purpose of obtaining
transit visas, visit visas, and other types of visas or entry permits on behalf
of the Company and to sign and file any document, forms or papers that may be
required by the Department of Immigration and Naturalization;
l)
Signing, filing and delivering any application forms or documents or papers that
may be required by: Labor Ministry and labor authorities; Abu Dhabi
Municipality; Abu Dhabi Chamber of Commerce and Industry; Ministry of Economy;
Any other Ministry and or Government Office or Department; Any statutory or
administrative body, local authority or body;
m)
Signing and carrying on correspondence with all or any governmental office,
departments and ministries and statutory and administrative bodies on behalf of
the Company in relation to any of the matters mentioned above;
n)
Generally monitoring the Company's performance on a day-to-day basis and taking
whatever steps may be necessary from time to time to improve the performance and
profitability of the Company;
o)
Operating the Company's bank accounts (or other accounts) in relation to the
dayto- day operations of the Company as per an account mandate approved by the
Board of Directors which shall provide that the General Manager may sign checks
(or make payments by wire transfer or similar means) in the amount of AED 20,000
(twenty thousand) or less. The mandate shall provide that any amount exceeding
AED 20,000 (twenty thousand), whether paid in one payment or collectively
through multiple payments made within a 90 day period requires the written
approval of the Board of Directors; and
p)
Causing all employees at the start of their employment by the Company to execute
one or more agreements (in a form approved by the Board) regarding
noncompetition, confidentiality and Intellectual Property assignment in favor of
Second Party.
6.3 The
General Manager shall procure that a written agenda for each meeting of the
Board specifying the matters to be raised at the meeting is sent together with
the notice convening the meeting to all Directors-and their alternates not less
than seven days before the date of the meeting.
6.4 The
General Manager shall have all the powers and duties granted to him by virtue of
this Agreement to manage the Company, except for those reserved specifically for
the Board of Directors and the General Assembly.
7. Understanding of the
Parties
7.1 The
First Party agrees and undertakes to perform in a diligent and professional
manner the following:
a) To
provide to the Company initial office premises free-of-charge for the operation
of the Business in the Emirate of Abu Dhabi. The written approval of the Second
Party in relation to such facility shall be required prior to the commencement
of the Business. Should the Second Party not approve the facility, the First
Party agrees to take all necessary steps to ensure that the facility meets the
Second Party's requirements for the operation of the Business. The obligation to
provide such premises free-of-charge shall terminate if the Company's office
space requirements exceeds the area of the initial office premises
..
b) To
carry out and facilitate any formalities required from time to time so as to
enable the Company to carry out is Business in the Territory, including without
limitation assisting in obtaining all necessary licenses and authorizations in
each Emirate in the UAE where the Board determines that the Company shall
conduct business.
c) To
procure the Company with a Lease Agreement in the Company's name pertaining to
the lease of the premises and to insure that such lease is constantly renewed
and in legal order.
d) To
keep strictly confidential all the know-how and other information acquired from
the Second Party whether in mitten, oral or any other form or forms. both during
the term of this agreement and thereafter.
e) To not
provide or accept any form of direct or indirect compensation for providing any
products or services identical, similar, or related to the Business except
through the Company for as long as it has an ownership stake in the Company and
for 36 months after divesting its ownership stake.
f) To
provide the Company with its share of cash required for starting up the Business
and as forecasted prior to the execution of this Agreement.
g) To
provide the Company Additional Capital Contributions if and as decided by the
Extra Ordinary General Assembly of the Company if the business so
requires.
h) To use
its best endeavors to procure customers and acquire business for the
Company.
i) To
actively participate in professional marketing plans to increase the sales in
the Territory and to conduct its best efforts to reflect the market trend, rates
and various jobs intended to be undertaken by the Company.
j) To
transfer and assign all the order books for its potential customers to the
Company once the Company becomes operational.
k) To
communicate with the Second Party on regular basis regarding any new
developments related to the Business.
l) To
have the Company reimburse the Second Party once the Company receives positive
cash flow for 50% of any mutually agreed to out of pocket expenses related to
the Business provided the First Party can provide adequate documentation that
sold expenses were previously paid in full (or committed to be paid in full) by
the Second Party.
m) To
perfolTI1 all obligations under the Intellectual Property Rights license set
forth under 7.3.5.
n) Not to
compete, or represent any competitor, related to the Business or any endeavors
substantially similar to the Business for a period equal to the telTI1 of this
Agreement plus three (3) years.
7.2 The
Second Party hereby undertakes to perfolTI1 in a diligent and professional
manner in and all of the following services in connection with the
Business:
a) To
provide the knowledge, technology and know-how relating to the Business and to
make every effort to work at II level defined by the customer's
requirements.
b) To
license to the Company to a properly executed license agreement (as contemplated
by Clause 7.3.5), certain intellectual property, including but not limited to,
the technical know-how, infolTI1ution, drawings and specifications for the
development of robotics, automated parking systems and automated car wash
systems.
c) To
assist the First Party in acquiring new business by providing the latter with
complete information on technology, specification, drawings, visual or audio
recordings literature or catalogs related to the Business.
d) To
technically train an agreed number of the Company's personnel in relation to the
Business, on site or in the USA as necessary. The time and period of such
training shall be decided by mutual consultation of the Parties and all the
expenses related to such training shall be borne by the Company.
e) To
provide the Company with its share of cash required for starting up the Business
and as forecasted prior to the execution of this Agreement.
f) To
provide the Company Additional Capital Contributions if and as decided by the
Extra Ordinary General Assembly of the Company if the business so
requires.
g) To
provide the Company with a reasonable quotation for any project to be undertaken
by the Company in the Territory bearing in mind that such quotation will include
a fair profit margin to cover the overhead and profit of the Second Party's
parent company. Such quotation shall be in line with the First Party's
recommendation vis-a-vis the project and the customer.
7.3 The
Parties hereby mutually agree to the following:
7.3.1 To
run and develop the business in a professional manner and to an extent defined
by the Board from lime to time and in total compliance with the Articles of
Association.
7.3.2 To
prepare a detailed budget for the operation of the Company and to spend in
line
with such
budget .
7.3.3 To
invest equally in the Company at start-up and make capital calls as set forth in
as and when decided by the Extra ordinary General Assembly of the
Company.
7.3.4 To
mark up the quotation received from the Second Party regarding a project to be
undertaken in the Territory in a way that maximizes profit for the Company
without affecting its sales operations.
7.3.5
That all Intellectual Property Rights, including without limitation, know-how,
formulas, the Boomerang name (and all derivations thereof) secret data,
trademarks, patents, copyrights and all other related information, brought
forward by the Second Party for the operation of the Business and in connection
with this Agreement shall remain vested in the Second Party at all times. The
Parties further agree that all inventions, discoveries, trade secrets, designs
and improvements created or made by the either Party and which arise out of the
Business are and will be the sole and exclusive ownership of the Second Party by
virtue of this agreement and without the need for execution of any further
assignment by Firs! Party or the Company. The Second Party shall grant the
Company a license to use such intellectual property rights throughout the
duration of the Company.
7.3.6 The
Parties further agree that any equipment, tools and machinery purchased after
the execution of this Agreement and during the course of business shall remain
the property of the Company. In the event of termination of this Agreement or
winding up of the Company, all such equipment, tools and machinery shall be sold
and the proceeds pertaining thereto shall be split evenly between the
Parties.
8.
Compliance with Ancillary Agreements
Each
party hereby agrees and undertakes to' the other Party to procure the compliance
of the Company with its obligations under any Agreement required to fulfill the
objects of the Company.
9.
Dividend Policy
Nothing
in this Agreement is intended to limit the extent to which the Company may
declare and pay dividends to the Shareholders in respect of each Financial Year
during the term of this Agreement, and the Company shall pay such dividends
(whether cash or otherwise) as may be declared by the Board of directors
pursuant, and subject to the Commercial Companies Law and the Memorandum of
Association.
10.
Budgets and Financial Information
10.1 The
Shareholders shall procure that the Board of Directors will prepare and deliver
to them in the agreed format:
a) Prior
to the commencement of each financial year, an annual budget and cash flow
forecast for the next financial year;
b) Within
10 days of the end of each month, an audited management account (including
comparisons against budget) made up to the end of each month;
c) Annual
audited accounts of the Company within one month of the end of the financial
year to which they relate;
d) As and
when available, full details of any actual or prospective material change in the
business or the financial position or affairs of the Company.
e) Follow
GAAP accounting standards.
11.
Dealing with Shares
11.1 No
Shareholder shall pursuant to article 9 of the Memorandum of Association and
without obtaining prior approval of the other Shareholder:
11.1.1
Sell, assign, transfer, pledge, mortgage, charge or otherwise encumber any share
of any interest in any share;
11.1.2
Grant an option over any share or any interest in any share; or
11.1.3
Enter into any agreement in respect of the votes attached to any
share.
11.1.4 A
transfer of any share pursuant to Article 9 of the Memorandum of Association
shall be on the
following conditions:
11.1.5 If the Shareholder
transfers any share to a person who is not already a Shareholder it shall
require the transferee as a condition of the transfer to execute a deed in the
form of the Deed of Adherence confirming to the other Shareholders that it shall
be bound by this Agreement as a Shareholder in respect of each share
transferred;
11.1.6
Each Shareholder shall procure that the Board registers in the Register a
transfer of shares carried out in accordance with this Agreement and the
Memorandum of Association in the agreed form.
12.
Winding up of the Company
The
Parties shall (unless they agree otherwise in writing) procure that the Company
is wound up in accordance with the provisions of the Commercial Companies Law
and the Memorandum of Association. Following winding up, the Boomerang name (and
any derivations thereof) may not be used by the First Party.
13.
Compliance with this Agreement
Each
Shareholder undertakes to the others that it shall take all practicable steps
including, without limitation, the exercise of votes it directly or indirectly
controls at meetings of the Board of Directors and General Assembly of the
Company to ensure that the terms of this Agreement are complied with and to
procure that the Board of Directors and the Company complies with its
obligations and that it shall do all such other acts and things as may be
necessary or desirable to implement this Agreement.
14.
Term and Termination
14.1 The
Term of this Agreement shall commence on the Commencement Date and shall expire
upon the expiration of the duration of the Company (the "Term"), unless
terminated earlier as provided in Clause 14.2 below.
14.2 This
Agreement may terminate earlier than upon the expiration of the duration of the
Company by the first to occur of:
a) An
agreement between all the Parties to terminate this Agreement;
b) Upon
ninety (90) days written notice, before the expiration of the period specified
for the Company, of one Party to the other Party expressing his willingness to
dissolve the Company, in compliance with clause 3.4; and/or
c)
Termination and liquidation of the Company as per the Memorandum of
Association.
d) Upon
five (5) days written notice of one Party to the other of a breach of any term
of this Agreement that is not cured within the five (5) day notice
period.
15
Liabilities of Shareholders
15.1 The
Shareholders shall have no liability with respect to liabilities and obligations
of the Company.
15.2 Each
Shareholders shall remain liable to the other related to any breach of this
Agreement, including, without limiting the foregoing, any breach of Clause
7.
16.
Confidentiality
16.1 Each
Party may use the Confidential Information of a disclosing Party only for the
purposes of this Agreement and must keep confidential all Confidential
Information of each disclosing Party except to the extent (if any) the recipient
of any Confidential Information is required by law to disclose the Confidential
Information.
16.2
Either Party may disclose Confidential Information of the other Party to those
of its employees and agents who have a need to know the Confidential Information
for the purposes of this Agreement but only if the employee or agent executes a
confidentiality undertaking in a form approved by the other Party.
17.
Intellectual Property Rights
17.1
Nothing in this Agreement shall give either Party any rights in respect of the
Intellectual Property Rights of the other Party and each Party acknowledges that
it shall not acquire any of the Intellectual Property Rights of the other Party
and that all such Intellectual Property Rights remain vested at all times in the
respective Party.
18.
Notices
All
notices delivered pursuant to the provisions hereof shall be deemed delivered
when (a) actually delivered by hand, (b) ten days after being sent by registered
mail, or (c) two days after being sent via a nationally recognized courier
service. or (d) one day after being sent by facsimile, to the recipient's
address or facsimile number set forth hereunder, or to such other address or
facsimile number of which the recipient last shall have notified the other Party
in writing:
For the
First Party:
Tawreed
Companies Representation
P.O. Box
112358, Abu Dhabi, UAE
Tel:
+971-24952734 Fax: +971-26740066
Attention:
Mr. Cyrus Hodes
For the
Second Party:
BOOMERANG
USA CORP.
355
Madison Avenue, Morristown, NJ, 07960, USA
Tel:
+18004941421 Fax: +1973 387 8512
Attention:
Mr. Woody Nash- Business Development Manager
19.
Governing Law and Arbitration
19.1 This
Agreement shall be governed by and construed in accordance with the laws of the
Emirate of Abu Dhabi and the United Arab Emirates.
19.2
Should a dispute arise between the Parties, the Parties will meet and attempt to
come to an amicable agreement. If they fail to reach a resolution within 30 days
or then the dispute may be referred to final and binding arbitration by either
Party.
19.3
Subject to Clause 19.2, any dispute arising out of or in connection with this
Agreement, including any question regarding its existence, validity or
termination, may be referred to and finally resolved by arbitration under the
Rules of the London Court of International Arbitration (LCTA) as applied by the
Dubai international Financial Center (the "DIFC"), which Rules are deemed to be
incorporated by reference into this clause. The number of arbitrators shall be
one. The seat, or legal place, of arbitration shall be Dubai. The language to be
used in the arbitration shall be English.
19.4
Notwithstanding any provision to contrary in this Agreement, this Clause 19
shall survive the expiry or termination of this Agreement or any other provision
hereof7
20.
Miscellaneous
20.1
Expenses: the Parties shall jointly bear all legal and other costs and expenses
in connection with the preparation, negotiation and execution of this Agreement.
All fees and expenses incurred in connection with the formation of the Company
shall be accounted for in the financial records of the Company. All reasonable
expenses incurred individually by any of the Parties for the purposes of
establishing the Company shall be reimbursed by the Company to the Party
incurring the expense, upon the Company's establishment as a legal entity,
provided that the Party incurring the expense provides the Company with an
invoice for such expenses (to be charged at cost, with no mark-up) with
appropriate receipts and/or documentation.
20.2
Assignment: This Agreement shall inure to the benefit of and be binding upon the
Parties and their successors and permitted assignees. Neither this Agreement nor
any rights or obligations hereunder may be assigned, in whole or in part, by any
Party without the prior written consent of the other Party, which consent shall
not be unreasonably withheld.
20.3
Completion: Each of the Parties hereto endeavors, in good faith and in a spirit
of cooperation, to successfully and timely complete the transactions
contemplated by this Agreement.
20.4
Severability of Provisions: If, for any reason whatsoever, any provision of this
Agreement should be proven to be invalid, in whole or in part, such invalidity
shall only affect the portion of such provision which shall be proven to be
invalid and in all other respects this Agreement shall remain in full force and
effect and unaffected by such invalid provision as if the same had not been
included herein.
20.5
Clause Headings: Clause headings contained herein are for convenience of
reference purposes only and shall not be used in the construction or
interpretation of this Agreement.
20.6 No
Waiver of Rights and Default: No failure or delay of a Party in the exercise of
any right given to such Party hereunder shall constitute a waiver of such right,
nor shall any single or partial exercise of any such right preclude any other or
further exercise thereof or of any other right. The waiver by a Party of any
default by the other Party under any provision hereof shall not be deemed to be
a waiver of any subsequent default of any other right.
20.7
Language: This Agreement has been negotiated and drafted in the English
language. If reference to an Arabic translation in required, any ambiguity in
the Arabic text or any disagreement concerning the Arabic text shall be resolved
by reference to the English text. All communications between the Parties shall
be in the English language, and in the event of any dispute or controversy,
English shall prevail.
20.8
Remedies Cumulative: Except as specifically provided herein, the remedies
provided herein shall be cumulative and shall not preclude the assertion by the
First Party or by the Second Party of any other rights or the seeking of any
other remedies against the other, or its successors or assigns. Nothing
contained herein shall preclude a Party from seeking equitable relief, where
appropriate,
20.9
Entire Agreement and Amendment: This Agreement and the other instruments and
documents referred to herein or delivered pursuant hereto, contains the entire
agreement among the Parties with respect to the subject matter hereof and
supersedes all prior oral or written agreements, commitments or understandings
with respect to such matters. No amendment, modification or discharge of this
Agreement shall be valid or binding unless set forth in writing and duly
executed by the Party against whom enforcement of the amendment, modification or
discharge is sought.
20.10 No
Commercial Agency: The Parties expressly agree that this is not a commercial
agency agreement and that the First Party is not the commercial agent of the
Second Party. The First Party undertakes that it will not make any attempt to
register this Agreement (or make any other registration) with the V.A.E. Ministry of Economy
(or any other authority) pursuant to the V.A.E. Federal Law No. 18 of 1981
Governing Commercial Agencies, as amended or any similar law or
regulation.
20.11
Survival: Clauses 7, 15, 16, 17 and 19 shall survive termination of this
Agreement.
IN WITNESS WHEREOF, the
Parties have caused this Agreement to be executed by their duly authorized
representative on the date set forth below.
First
Party
Tawreed
Companies Representation
Second
Party
Boomerang
USA Corp.