\n| \n Schedule 14 The Plant<\/p>\n<\/td>\n | <\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
\nThis Agreement<\/strong> is dated 15 June 2011<\/p>\n<\/p>\n<\/p>\nParties<\/strong><\/p>\n<\/p>\n\n\n\n| \n (1)<\/p>\n<\/td>\n | \n Signature Industries Limited<\/strong>, a company incorporated under
\nthe laws of England (registered number 2800561) whose registered office is at
\nTom Cribb Road, Thamesmead, London SE28 0BH, United Kingdom (the
\nSeller<\/strong>);<\/p>\n<\/td>\n<\/tr>\n\n| \n (2)<\/p>\n<\/td>\n | \n McMurdo Limited<\/strong>, a company incorporated under the laws of
\nEngland (registered number 06952856) whose registered office is at Silver Point,
\nAirport Service Road, Portsmouth PO3 5PB (the Buyer<\/strong>); and<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n| \n (3)<\/p>\n<\/td>\n | \n Digital Angel Corporation<\/strong>, a company incorporated under the
\nlaws of the state of Delaware, whose registered office is 490 Villaume Avenue,
\nSouth St Paul, MN 55075 -2433 USA (the Guarantor<\/strong>).<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\nAgreed terms:<\/strong><\/p>\n<\/p>\n\n\n\n| \n 1 <\/strong><\/p>\n<\/td>\n| \n Definitions and interpretation<\/strong><\/p>\n<\/td>\n<\/tr>\n\n| \n 1.1<\/p>\n<\/td>\n | \n In this Agreement, unless the context otherwise requires, the following words
\nshall have the following meanings:<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n AAPLB Licence<\/strong> means the licence in the Agreed Form of the
\nIntellectual Property known as AAPLB from the Buyer to the Seller;<\/p>\n<\/p>\nAccounting Date<\/strong> means 31 December 2010;<\/p>\n<\/p>\nAccounts<\/strong> means the accounts relating to the Business
\nincorporated into the audited financial statements of the Seller for the
\naccounting reference period ended on the Accounting Date comprising a balance
\nsheet, profit and loss account, notes, the directors153 and auditors153 reports and
\ncashflow statements a copy of which is contained in the Disclosure Documents;\n<\/p>\n<\/p>\nAgency Agreements<\/strong> means those agreements with agents or
\ndistributors entered into on or prior to the Transfer Date by or on behalf of
\nthe Seller in connection with and in the ordinary course of the Business which
\nat the Transfer Date remain to be performed in whole or in part by the Seller
\nincluding those agreements listed in Schedule 10;<\/p>\n<\/p>\nAgreed Form <\/strong>means a document in a form approved by or on
\nbehalf of the Seller and the Buyer on or before the Completion Date;<\/p>\n<\/p>\nAgreed Form Schedules<\/strong> means the following Schedules:<\/p>\n<\/p>\n
\n(a) Schedule 1 (Apportionment of Price);<\/p>\n<\/p>\n (b) Schedule 6, Part 1 (the Employees); and<\/p>\n<\/p>\n (c) Schedule 14 (the Plant);<\/p>\n<\/p>\n<\/p>\n Assets<\/strong> means the assets of the Business agreed to be sold
\nand purchased pursuant to this Agreement as described in clause 3.1;<\/p>\n<\/p>\nBook Debts<\/strong> means the trade debts owing to the Seller on the
\nTransfer Date ;<\/p>\n<\/p>\nBusiness<\/strong> means the business of the design, manufacture and
\nsale of personal location beacons and complimentary search and rescue equipment
\n(including the products listed at Schedule 8) carried on by the Seller at the
\nTransfer Date (excluding the Retained Business);<\/p>\n<\/p>\nBusiness Contracts<\/strong> means the Agency Agreements, Customer
\nContracts, Supplier Contracts and the Leasing\/Hire Agreements;<\/p>\n<\/p>\nBusiness Day <\/strong>means any day which is not a Saturday, a Sunday
\nor a bank or public holiday in England;<\/p>\n<\/p>\nBusiness Information<\/strong> means all information, documentation,
\npapers, books, records, know-how and techniques (whether or not confidential and
\nin whatever form held) which predominantly relates to:<\/p>\n<\/p>\n\n\n\n| \n (a)<\/p>\n<\/td>\n | \n all or any part of the Business and Assets (including all books, accounts,
\ncredit reports, price lists, cost records, work tickets, catalogues,
\ncertificates of title, correspondence with the patent and trade mark agents
\nrelating to any registered Business Intellectual Property and all registration
\ncertificates therefor);<\/p>\n<\/td>\n<\/tr>\n | \n| \n (b)<\/p>\n<\/td>\n | \n any Products and Processes or services rendered by the Seller in connection
\nwith the Business (including the Central Data Store, formulae, designs,
\nspecifications, drawings, data, manuals or instructions, plans, product
\ndescriptions, user or test reports, type approval papers or certificates,
\ninstructional and promotional material and other technical material together
\nwith any plates, blocks, negatives and similar material relating thereto);<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
\n\n\n\n| \n (c)<\/p>\n<\/td>\n | \n the operations, management, administration, or financial affairs of the
\nBusiness (including all employee records and interview records, any business
\nplans or forecasts, information relating to future business development or
\nplanning information relating to litigation or legal advice); and<\/p>\n<\/td>\n<\/tr>\n | \n| \n (d)<\/p>\n<\/td>\n | \n the sale or marketing of any of the products manufactured and\/or sold or
\nservices rendered by the Business including all customer and supplier names and
\nlists, sales advertising and marketing information (including targets, sales and
\nmarket share statistics, market surveys and reports on research commissioned by
\nthe Seller and terms and conditions of sale or supply);<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n Business Intellectual Property <\/strong>means all Intellectual
\nProperty owned, or lawfully used or enjoyed by the Seller or any member of the
\nSeller153s Group predominantly in connection with the Business as carried on by
\nthe Seller as at the Transfer Date including:<\/p>\n<\/p>\n\n\n\n| \n (a)<\/p>\n<\/td>\n | \n those items of registered Intellectual Property (and applications therefor)
\ndescribed in Schedule 13 Part 1;<\/p>\n<\/td>\n<\/tr>\n | \n| \n (b)<\/p>\n<\/td>\n | \n the domain names referred to in Schedule 13 Part 2;<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n \n\n\n| \n (c)<\/p>\n<\/td>\n | \n all other Intellectual Property used in the Products and Processes;<\/p>\n<\/td>\n<\/tr>\n | \n| \n (d)<\/p>\n<\/td>\n | \n the Business Information;<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n \n\n\n| \n (e)<\/p>\n<\/td>\n | \n all Intellectual Property which is needed to fulfil any Customer Contracts;\n<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n Business Name<\/strong> means “Sarbe” or any name including the word
\n“Sarbe” or any colourable imitation of it;<\/p>\n<\/p>\nBuyer153s Solicitors<\/strong> means Blake Lapthorn of New Kings Court,
\nTollgate, Chandler’s Ford, Eastleigh SO53 3LG (reference: CO.MSP.572192.1);<\/p>\n<\/p>\nCAA<\/strong> means the Capital Allowances Act 2001;<\/p>\n<\/p>\nCapped Claims<\/strong> means any claims by the Buyer under (a) this
\nAgreement (including any Claims but excluding any claim by the Buyer under any
\nof the Employment Indemnities ) and (b) the Transaction Agreements;<\/p>\n<\/p>\nCentral Data Store<\/strong> means the Seller’s data store containing
\ntechnical details relating to the Products and Processes;<\/p>\n<\/p>\nClaim<\/strong> means any claim for breach of any of the Warranties;\n<\/p>\n<\/p>\n
\nCompletion<\/strong> means completion of the sale and purchase of the
\nBusiness and the Assets in accordance with clause 6;<\/p>\n<\/p>\nCompletion Date<\/strong> means (subject to clause 2) the date which
\nis the earlier of:<\/p>\n<\/p>\n\n\n\n| <\/td>\n | \n (a)<\/p>\n<\/td>\n | \n the date on which the last unsatisfied Condition has been satisfied;<\/p>\n<\/td>\n<\/tr>\n | \n| <\/td>\n | \n (b)<\/p>\n<\/td>\n | \n the date on which the Buyer has waived the last unsatisfied Relevant
\nCondition in accordance with clause 2.3; or<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n \n\n\n| <\/td>\n | \n (c)<\/p>\n<\/td>\n | \n such other date as the Buyer and Seller may agree in writing;<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n Completion Documents<\/strong> means the Transaction Agreements other
\nthan this Agreement;<\/p>\n<\/p>\nConditions <\/strong>means the conditions set out in clause 2.1;<\/p>\n<\/p>\nCreditors<\/strong> means all trade and other debts, accrued charges
\nand all other amounts owing by the Seller in connection with the Business on the
\nTransfer Date ;<\/p>\n<\/p>\nCustomer Contracts<\/strong> means all those contracts, engagements or
\norders entered into on or prior to the Transfer Date by or on behalf of the
\nSeller with customers for the sale, loan or hire of goods or equipment or
\nprovision of services by the Seller (including any related non-disclosure or
\nconfidentiality agreements with such customers) in connection with and in the
\nordinary course of the Business which at the Transfer Date remain to be
\nperformed in whole or in part by the Seller including those listed in Schedule
\n9;<\/p>\n<\/p>\nDisclosed<\/strong> means accurately and fairly disclosed to the
\nBuyer, expressly for the purposes of this Agreement, in the Disclosure Letter
\nmeaning that the matter or other information in question is disclosed in
\nsufficient detail to enable the Buyer to make a reasonably informed decision
\nabout its nature, scope and effect;<\/p>\n<\/p>\nDisclosure Documents<\/strong> means the documents contained in the
\nelectronic data room on the CD Rom initialled by the Seller and the Buyer or on
\ntheir behalf for identification;<\/p>\n<\/p>\nDisclosure Letter<\/strong> means a letter dated the same date as the
\nCompletion Date from the Seller to the Buyer together with the Disclosure
\nDocuments, both being in the form agreed by the Seller and the Buyer and which
\nhave been signed for identification by or on behalf of them;<\/p>\n<\/p>\nEC Treaty<\/strong> means the treaty establishing the European Union
\nin 1992;<\/p>\n<\/p>\n
\nEmployees<\/strong> means the persons wholly or mainly employed in the
\nBusiness at the date of this Agreement up to and including the Transfer Date
\n(whose names are set out in Schedule 6 Part 1 together with certain particulars
\nof their respective employments);<\/p>\n<\/p>\nEmployment Indemnities<\/strong> means all of the indemnities given by
\nthe Seller in Schedule 6, Part 2;<\/p>\n<\/p>\nEscrow Account<\/strong> means an interest bearing bank account in the
\njoint names of the Escrow Agents and designated as required by the Instruction
\nLetter;<\/p>\n<\/p>\nEscrow Agents<\/strong> means the Seller’s Solicitors and the Buyer’s
\nSolicitors;<\/p>\n<\/p>\nEscrow Agreement<\/strong> means the agreement, in Agreed Form, to be
\nsigned by the Seller and the Buyer instructing and authorising the Escrow Agents
\nto establish and operate the Escrow Account;<\/p>\n<\/p>\nEvent<\/strong> means any event, act, transaction, arrangement,
\ndefault or omission including, with out limitation, the receipt or accrual of
\nany income or gains or of any distribution, failure to distribute, acquisition,
\ndisposal, transfer, payment, loan or advance including, without prejudice to the
\ngenerality of the foregoing, the sale and purchase of the Business and the
\nAssets pursuant to this Agreement;<\/p>\n<\/p>\nExcluded Assets<\/strong> means the assets referred to in Schedule 7,
\nPart 1;<\/p>\n<\/p>\nExcluded Liabilities<\/strong> means all the liabilities or
\nobligations referred to in Schedule 7, Part 2;<\/p>\n<\/p>\nGoodwill<\/strong> means the goodwill, custom and connection of the
\nSeller in relation to the Business together with the exclusive right for the
\nBuyer and its successors and assigns to carry on the Business under the Business
\nName and respectively to represent themselves as carrying on the Business in
\nsuccession to the Seller;<\/p>\n<\/p>\nGuarantee Obligations<\/strong> has the meaning given at clause 19.4;\n<\/p>\n<\/p>\nHealth and Safety Laws <\/strong>means all applicable primary and
\nsubordinate legislation, common law, treaties, regulations, directives, orders,
\ncodes of practice and guidance notes in existence at or before Completion and
\ndesigned to protect humans against risks to health or safety arising from work
\nactivities or from premises occupied for work activities (including the Health
\nand Safety at Work etc Act 1974, the Offices, Shops and Railway Premises Act
\n1963, the Factories Act 1961, the Children and Young Persons Act 1933, the Fire
\nPrecautions Act 1971 and the Regulatory Reform (Fire Safety) Order 2005);<\/p>\n<\/p>\nImmigration, Asylum and Nationality Acts<\/strong> together mean the
\nImmigration, Asylum and Nationality Act 2006, the Asylum and Immigration Act
\n1996 and the Immigration Acts of 1971, 1996 and 1998;<\/p>\n<\/p>\n
\nImmigration Rules<\/strong> means the immigration rules deriving from
\nthe Immigration, Asylum and Nationality Acts;<\/p>\n<\/p>\nIndependent Accountant<\/strong> means such independent chartered
\naccountant qualified as such for not less than 10 years and engaged in private
\npractice as is appointed jointly by the Seller and the Buyer or (in default) by
\nthe President for the time being of the Institute of Chartered Accountants in
\nEngland and Wales;<\/p>\n<\/p>\nInstruction Letter <\/strong>means the letter in Agreed Form from the
\nSeller and Buyer to the Escrow Agents relating to the Retention;<\/p>\n<\/p>\nIntellectual Property<\/strong> means patents, know-how, goodwill,
\nregistered and unregistered trademarks and service marks (including any trade,
\nbrand or business names and any distinctive colours, smells or sounds used to
\ndifferentiate any goods or services), domain names, registered designs, design
\nrights, utility models, copyright (including all such rights in computer
\nsoftware, information and any databases), database rights, moral rights and
\ntopography rights, trade secrets and other confidential information, rights in
\nthe nature of unfair competition rights and right to sue for passing off and any
\nother similar intellectual or commercial rights (in each case whether or not
\nregistered or registrable for the full period thereof and all extensions and
\nrenewals thereof), applications for any of the foregoing and the right to apply
\nfor any of the foregoing in any part of the world and any similar rights
\nsituated in any country; and the benefit (subject to the burden) of any and all
\nagreements, arrangements and licences in connection with any of the foregoing;\n<\/p>\n<\/p>\nInterest Rate<\/strong> means 4% above the base rate of the Bank of
\nEngland from time to time;<\/p>\n<\/p>\nLeasing\/Hire Agreements<\/strong> means all those contracts,
\nengagements or orders entered into on or prior to the Transfer Date by or on
\nbehalf of the Seller in relation to the leasing, lease purchase or hire of goods
\nor equipment for use in and in the ordinary course of the Business which on the
\nTransfer Date remain to be performed in whole or in part as listed in Schedule
\n12;<\/p>\n<\/p>\nLicensed Sponsor<\/strong> means an organisation or educational
\ninstitution that is licensed by the UK Border Agency to sponsor migrants to come
\nto the UK under the points-based system;<\/p>\n<\/p>\nManagement Accounts<\/strong> means the unaudited accounts comprising
\na balance sheet as at 30 April 2011 and a profit and loss account for the period
\nwhich commenced on 1 January 2011 and ended on 30 April 2011, a copy of which
\nare contained in the Disclosure Documents;<\/p>\n<\/p>\nManagement Services Agreement<\/strong> means the agreement in the
\nAgreed Form in respect of certain management services to be provided to the
\nSeller;<\/p>\n<\/p>\nMigrant Worker<\/strong> means any worker or employee:<\/p>\n<\/p>\n
\n(a) under Tiers 1, 2 or 5 or a student under Tier 4 of the points-based
\nsystem; or<\/p>\n<\/p>\n (b) from Bulgaria or Romania; or<\/p>\n<\/p>\n (c ) from any EU Accession Worker State; or<\/p>\n<\/p>\n (d) who is employed under a work permit; or<\/p>\n<\/p>\n (e) who otherwise requires permission to work in the UK;<\/p>\n<\/p>\n MOD Contracts <\/strong>means those Customer Contracts set out in
\nclause 2.1.2;<\/p>\n<\/p>\nPatent Assignment<\/strong> means an assignment in the Agreed Form in
\nrespect of registered patents used in the Business, between the Seller (and each
\nmember of the Seller153s Group that owns any such registered patents) and the
\nBuyer;<\/p>\n<\/p>\n;<\/p>\n<\/p>\n Payment Date<\/strong> means the first anniversary of the Completion
\nDate;<\/p>\n<\/p>\n<\/p>\nPELS Contract <\/strong>means the development, manufacture and sale
\nagreement dated 28 July 2008 (as amended by an amendment agreement dated 18 May
\n2010) between (1) the Seller and (2) the UK Ministry of Defence (contract number
\nICE\/00032) a copy of which is in the Disclosure Documents;<\/p>\n<\/p>\nPlant<\/strong> means all fixed or moveable plant, equipment and
\nmachinery including tools wherever situated belonging to the Seller and used
\npredominantly in connection with the Business including those items listed in
\nSchedule 14;<\/p>\n<\/p>\nPrice<\/strong> means the total purchase price payable by the Buyer to
\nthe Seller as referred to in clause 4.1;<\/p>\n<\/p>\nProducts and Processes<\/strong> means:<\/p>\n<\/p>\n\n\n\n| \n (a)<\/p>\n<\/td>\n | \n any products, spare parts or processes developed, assembled, manufactured
\nand\/or sold by the Business (including any earlier or amended, modified,
\nimproved or developed version thereof and including the products listed at
\nSchedule 8);<\/p>\n<\/td>\n<\/tr>\n | \n| \n (b)<\/p>\n<\/td>\n | \n any products or processes which have been or were the subject of any research
\nor development undertaken predominantly by the Business (whether or not
\ncompleted or abandoned);<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n \n\n\n| \n (c)<\/p>\n<\/td>\n | \n any processes used by the Business;<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
\nin each case in the 24 month period up to and including the Transfer Date;\n<\/p>\n<\/p>\n<\/p>\n Relevant Claim<\/strong> means any claim by the Buyer pursuant to this
\nAgreement;<\/p>\n<\/p>\nRelevant Conditions<\/strong> means those Conditions set out at
\nclauses 2.1.1 and 2.1.2;<\/p>\n<\/p>\nRemedial Costs <\/strong>means all costs, claims, expenses,
\nliabilities, obligations and undertakings whatsoever resulting from any defects
\nin, or alleged defects in, goods or parts of goods sold or supplied or services
\nprovided in the course of the Business prior to the Transfer Date;<\/p>\n<\/p>\nRetained Business<\/strong> means any businesses including all the
\nassets, contracts and any other property and rights in connection with such
\nbusinesses (other than the Business and Assets) carried on or previously carried
\non by the Seller including the manufacture and supply of advanced aircrew
\npersonal locator beacons in satisfaction of the PELS Contract;<\/p>\n<\/p>\nRetained Stock <\/strong>means the stock-in-trade used in the Retained
\nBusiness together with any Stock given a nil value in accordance with the
\nprovisions of Schedule 2 including raw materials, goods and other assets
\npurchased for resale, stores, component parts, work in progress, together with
\nfinished products and packaging and promotional material;<\/p>\n<\/p>\nRetention<\/strong> means the sum of 200,000;<\/p>\n<\/p>\nRoke<\/strong> means Roke Manor Research Limited;<\/p>\n<\/p>\nSchedule of Apportionments <\/strong>means the schedule of
\napportionments made under clause 14.6;<\/p>\n<\/p>\nSecurity Interest<\/strong> means any encumbrance, mortgage, charge,
\nassignment for the purpose of security, pledge, lien, right of set-off,
\nretention of title or hypothecation for the purpose, or which has the effect, of
\ngranting security interest of any kind whatsoever and any agreement, whether
\nconditional or otherwise, to create any of the foregoing;<\/p>\n<\/p>\nSeller153s Scheme<\/strong> means the pension scheme known as the
\nPrudential Money Purchase Master Plan and the Prudential Stakeholder Plan, full
\nparticulars of which have been Disclosed;<\/p>\n<\/p>\nSeller153s Group<\/strong> means the Seller, its holding company and all
\ncompanies and undertakings which now or in the future become subsidiaries or
\nsubsidiary undertakings of the Seller or of any such holding company;<\/p>\n<\/p>\nSeller153s Solicitors<\/strong> means Kimbells LLP of Power House,
\nHarrison Close, Knowlhill, Milton Keynes MK5 8PA (reference: FMP\/ADS79-58);<\/p>\n<\/p>\n
\nSpecial Provisions Order<\/strong> means the VAT (Special Provisions)
\nOrder 1995 SI 1995\/1268;<\/p>\n<\/p>\nStock<\/strong> means the stock-in-trade of the Business at the | | | | | | | | | | | | | | | |