KRUG INTERNATIONAL CORP
AGREEMENT
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>3
<FILENAME>g72156ex10-1.txt
<DESCRIPTION>AGREEMENT
<TEXT>
<PAGE>

                              DATED 30 AUGUST 2001




                 BRADLEY INTERNATIONAL HOLDINGS LIMITED    (1)

                                      and

                     MARSHALL COOPER AND JOHN CLEGG    (2)




                    ----------------------------------------

                                   AGREEMENT
                    RELATING TO THE SALE AND PURCHASE OF THE
                      WHOLE OF THE ISSUED SHARE CAPITAL OF
                                BELDRAY LIMITED

                    ----------------------------------------

<PAGE>
                                    CONTENTS

<Table>
<Caption>
CLAUSE    HEADING                                                           PAGE
------    -------                                                           ----
<S>       <C>                                                               <C>
 1        Interpretation .................................................    1

 2        Recitals .......................................................    3

 3        Sale of Shares .................................................    3

 4        Conditions Precedent ...........................................    3

 5        Consideration ..................................................    4

 6        Completion .....................................................    4

 7        Option to Reacquire ............................................    5

 8        Undertakings ...................................................    5

 9        Costs ..........................................................    6

10        General Provisions .............................................    6

11        Notices ........................................................    7

12        Law ............................................................    7

Schedule 1 ...............................................................    8

Schedule 2 ...............................................................    9
</Table>

<PAGE>
THIS AGREEMENT is made on 30 August 2001 BETWEEN


(1)      BRADLEY INTERNATIONAL HOLDINGS LIMITED (Registered in England No.
         3407901) whose Registered Office is at P O Box 20, Beldray Road,
         Bilston, WV14 7NF (the "Seller"); and

(2)      THE PERSONS whose names and addresses are set out in Schedule 1 hereto
         (collectively the "Buyers" which expression shall include their
         respective legal personal representatives and successors in title from
         time to time).

1        INTERPRETATION

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

         "Agreed Form" means in a form which has been agreed by the parties and
         which has been duly executed or initialled for identification by them
         or on their behalf;

         "Beldray VAT Liability" means all liability to account for VAT in
         relation to the activities of the Company and its Related Companies
         prior to the separation of KUK from the Company's VAT grouping other
         than in respect of VAT inputs and outputs properly attributable to KUK
         or the Seller.

         "Business Day" means a day (other than a Saturday or Sunday) on which
         clearing banks are ordinarily open for business (other than solely for
         trading and settlement in euro) in London;

         "Completion Date" means the third business day following the date on
         which the last of the Conditions is satisfied or waived or such other
         date (not being after the Key Date) as the Seller and Buyers may agree
         in writing;

         "The Company" means Beldray Limited (Registered in England No. 62665)
         whose Registered Office is at P O Box 20, Beldray Road, Bilston, WV14
         7NF;

         "Conditions" means the conditions precedent set out in schedule 2;

         "The CVA Proposal" means the plan for a creditors voluntary arrangement
         of the Company to be proposed in the agreed form;

         "Key Date" means 31 December 2001 (or such other date as the Seller and
         the Buyers may agree in writing);

         "KUK" means KRUG International (UK) Limited (Registered in England No.
         516171) whose Registered Office is at P O Box 20, Beldray Road,
         Bilston, WV14 7NF;

         "Lease" means the reversionary lease of land and premises at Barton
         Industrial Estate, Mount Pleasant, Beldray Road, Bilston, West Midlands
         entered into by the Company relating to a previous lease of that land
         dated 8 June 1979 for a term of 35 years from 25 March 1979 (as revised
         from time to time) and shall included any Pre-Emption Agreement or
         other agreement relating to such land


                                       1




<PAGE>

         and premises under which KUK has any outstanding obligations as surety
         or guarantor;

         "Official Requirement" means any enactment, ordinance, pact, decree,
         treaty, code, directive, order, notice or official published plan or
         policy with legal or actual force in any geographical area and/or over
         any class of persons;

         "Option Exercise Event" means the appointment (other than the
         appointment anticipated in clause 2.2) of an administrator, receiver,
         or liquidator of the Company or, if earlier, the calling for
         performance by KUK of any obligation of guarantor or surety under the
         Lease due to a default under the Lease, in either event, during the
         period of the creditors voluntary arrangement as referred to in the CVA
         Proposal or, if longer, in the proposal approved by the Company's
         creditors in satisfaction of Condition 1;

         "Property" means the premises occupied by the Company at Beldray Road,
         Bilston, West Midlands including (for the avoidance of doubt) the
         property included in the Lease.

         "Related Company" in relation to a company means any company which at
         the relevant time is a subsidiary or holding company of that company or
         any subsidiary of any such holding company;

         "Security Documents" means any and all mortgages, debentures or
         guarantees securing facilities provided to the Company by National
         Westminster Bank Plc, Royal Bank of Scotland Commercial Services
         Limited or their Related Companies;

         "Shares" means the whole of the issued share capital of the Company;

         "VAT" means the Value Added Tax;

1.2      Any reference to an enactment is a reference to it as amended or as
         re-enacted with or without modification.

1.3      The clause or paragraph headings shall not affect construction.

1.4      References to individuals shall include corporations and vice versa,
         the masculine gender shall include the feminine and neuter genders and
         vice versa, and the singular shall include the plural and vice versa.

1.5      References to a clause or schedule are to a clause of, or a schedule
         to, this Agreement, references to this Agreement include its schedules
         and references in a schedule or part of a schedule to a paragraph are
         to a paragraph of that schedule or that part of that schedule;

1.6      Where any party gives in this Agreement any indemnity in favour of any
         other party, the obligation of the indemnifying party shall be to make
         the relevant payment forthwith in full on demand and without any
         set-off, counterclaim or other deduction.


                                       2
<PAGE>

1.7      All agreements, obligations and liabilities in this Agreement on the
         part of the Buyers are (unless expressly provided otherwise) joint and
         several and shall be construed accordingly and references to the Buyers
         shall include each of them severally.

2        RECITALS

2.1      The Company was incorporated in England as a private company limited by
         shares on 20 June 1899 under the Companies Acts 1862 to 1893.

2.2      A Court Order for the placing of the Company into administration under
         Part II of the Insolvency Act 1986 is to be sought immediately
         following execution of this Agreement. The Company proposes to exit
         that administration by seeking creditors approval to a creditors
         voluntary arrangement.

2.3      The Seller desires to sell and each of the Buyers is willing to
         purchase the number of the Shares specified opposite his respective
         name in column 2 of the Schedule for the consideration and upon the
         terms and subject to the conditions hereinafter contained.

3        SALE OF SHARES

3.1      Subject to clause 4, the Seller shall in accordance with clauses 5 and
         6 sell to each of the Buyers 50 per cent of the then issued share
         capital of the Company and the Buyers shall purchase the Shares with
         full title guarantee free from encumbrances and with the benefit of all
         present and future rights whether as to dividend capital voting or
         otherwise (including any dividend or other distribution declared paid
         or made on or after the date hereof).

3.2      References to "Shares" shall include any additional Shares issued in
         the share capital of the Company by way of capitalisation of profits or
         reserves or otherwise and any other securities directly or indirectly
         representing the Shares following any reorganisation or reconstruction
         of capital including any subdivision or consolidation to the extent
         that the Shares to be sold and purchased pursuant to clause 3.1 shall
         comprise the whole of the issued share capital of the Company.

4        CONDITIONS PRECEDENT

4.1      The obligations of the parties under clauses 3, 5, 6, 7 and 8 are
         conditional on the satisfaction or waiver of the Conditions on or
         before the Key Date (so that beneficial ownership in the Shares shall
         not pass unless and until the Conditions are satisfied or waived).

4.2      The Seller and the Buyers shall (subject to clause 4.3) use their
         reasonable endeavours to procure the satisfaction of the Conditions.
         The Buyers shall provide evidence (reasonably satisfactory to the
         Seller) of the satisfaction of the Conditions.

4.3      The Seller and the Buyers reserve the right to waive the Conditions
         wholly or in part and conditionally or otherwise (to such extent as
         they may jointly agree in writing) on or prior to the Key Date.


                                       3
<PAGE>
4.4      Any waiver by the Sellers and the Buyers under clause 4.3 is without
         prejudice to any other rights which the Sellers or the Buyers (as the
         case may be) may have under this Agreement.

5        CONSIDERATION

5.1      The consideration for the Shares shall be the payment by the Buyers of
         L1 and the performance by the Buyers of their obligations under this
         Agreement.

5.2      The Seller shall not be obliged to complete the sale of any of the
         Shares unless the sale and purchase of all the Shares is completed
         simultaneously.

6        COMPLETION

6.1      Completion shall take place at the Company's registered office (or such
         other place as the Buyer and the Seller shall agree) on the Completion
         Date whereupon:

         (a)      the Seller shall cause to be delivered to each of the Buyers
                  (a) share transfer(s) into the name of each of the Buyers in
                  respect of 50% of the then total issued share capital of the
                  Company duly executed and accompanied by the relevant share
                  certificate(s);

         (b)      the Seller shall procure the transfers mentioned in clause
                  6.1(a) shall be approved for registration (subject to their
                  being represented duly stamped);

         (c)      the Seller shall procure that all minute books, share
                  registers and other statutory books (duly written up to date),
                  the common seal and share certificate books, Certificate of
                  Incorporation and copies of the Memorandum and Articles of
                  Association of the Company shall be delivered to or made
                  available for collection by the Buyers;

         (d)      the Seller shall procure that Robert Thornton, Alistair Firth
                  and Geoffrey Hopwood resign as officers of the Company and
                  that a resolution of the Company is passed for the Company to
                  adopt new Articles of Association in such form as the Buyers
                  may reasonably require;

         (e)      the Seller shall procure that Geoffrey Hopwood, Robert
                  Thornton and Alistair Firth resign as officers of Hago
                  Products Limited;

         (f)      the Seller shall procure that Mark Stockslager and Alistair
                  Firth resign as trustees of the Beldray Pension Scheme;

         (g)      the Seller shall procure that the deeds relating to the
                  Property which are in the Seller's possession or control shall
                  be delivered to or/made available for collection by the
                  Buyers; and

         (h)      the Seller shall procure that the appropriate forms to amend
                  the mandate given by the Company to its bankers are supplied
                  to the Buyers.


                                       4
<PAGE>

7        OPTION TO REACQUIRE

7.1      Each of the Buyers further agrees for a consideration of L1 (if
         demanded) that the Seller shall have an option (the "Option") of
         purchasing all the Shares (subject to clause 7.5, the "Option Assets")
         from the Buyers for an aggregate consideration of L1 on the terms of
         this clause 7.

7.2      The Option is exercisable in whole but not in part by notice in writing
         from the Seller to the Buyers given at any time within six months of
         the happening of the Option Event, or such later date as the Seller and
         Buyers may from time to time agree in writing, whereupon the Buyers
         shall sell and the Seller shall purchase the Option Assets. A notice
         under this clause 7.2 shall be irrevocable.

7.3      The sale and purchase of the Option Assets shall be completed at the
         Company's then registered office (or such other place as the Buyers and
         the Seller may agree) on the fifth Business Day after the date of
         exercise of the Option when the Buyers shall deliver to the Seller or
         as it may direct duly executed transfers in respect of the Option
         Assets, together with the relative certificates (or an express
         indemnity in a form satisfactory to the Seller in the case of any
         certificate found to be missing) against satisfaction of the
         consideration payable for the Option Assets (if demanded)

7.4      Upon exercise of the Option the Buyers shall sell the Option Assets
         with full title guarantee, free from encumbrances and with all rights
         then or subsequently attaching to them and the Buyers shall execute and
         deliver other documents and take other steps at the reasonable request
         and cost of the Seller following completion of the sale and purchase of
         the Option Assets where this is required to vest the Option Assets in
         the Seller and otherwise to give it the full benefit of this Clause 7.
         Until the happening of the Option Event and while the Option remains
         exercisable the Buyers shall not encumber or dispose of the Option
         Assets or any interest in them except in accordance with this Clause 7.

7.5      References to the "Option Assets" include any additional shares issued
         in respect of other Option Assets by way of capitalisation of profits
         or reserves and any securities directly or indirectly representing
         Option Assets following any reorganisation or reconstruction of
         capital, including a subdivision or consolidation.

8        UNDERTAKINGS

8.1      Each of the Buyers hereby undertakes with the Seller:

         (a)      to procure that the Company does not agree any change to the
                  terms of the Lease without the prior written approval of KUK;

         (b)      to use all reasonable endeavours to ensure that whilst KUK has
                  any obligations as surety or guarantor under the Lease neither
                  KUK nor the Seller are disadvantaged by any transaction
                  involving the transfer of more than 50 per cent of the issued
                  shares in the capital of the Company at the relevant time (by
                  means of one transaction or a series of transactions) to one
                  or more persons who are not the spouse or child of a


                                       5
<PAGE>
                  Buyer (or a trustee for the same) such reasonable endeavours
                  shall include (without limitation) at an appropriate stage and
                  before Completion:

                  (i)      providing financial details of any such transferee
                           to KUK; and

                  (ii)     effecting an introduction between KUK and any such
                           transferee;

         (c)      to pay to KUK an amount in cash equivalent to 25% of the
                  consideration (after deduction of the reasonable professional
                  transaction costs incurred by the Buyers) payable for any
                  disposal by a Buyer of any interest in the Shares or of any
                  material part of the Company's assets or business which is
                  completed before the second anniversary of the Completion Date
                  such payment to be made within 2 business days of any such
                  completion.

9        COSTS

9.1      Subject to clause 9.2, the Buyers and the Seller will each bear their
         own legal and accountancy fees and expenses of and incidental to the
         preparation and implementation of this Agreement.

9.2      If in breach of this Agreement the Seller sells the Shares other than
         to the Buyers, the Seller undertakes (without prejudice to any other
         claim that the Buyer may have) to pay the Buyers' reasonable legal and
         accountancy fees and expenses incidental to the preparation of this
         Agreement up to a maximum amount payable by the Seller under this
         clause of L25,000.

10       GENERAL PROVISIONS

10.1     This Agreement constitutes the entire agreement between the parties
         with respect to the subject matter of this Agreement and shall entirely
         supersede all agreements, negotiations, statements of intent,
         warranties or representations whether written or oral made or given
         prior to the signing hereof.

10.2     The Buyers hereby acknowledge and declare that neither of them has
         entered into this Agreement in reliance upon any statements,
         representations, undertakings, warranties or information provided by
         the Seller, its Related Companies or any of their agents or employees.

10.3     This Agreement shall be binding on and enure for the benefit of the
         personal representatives and successors in title of the parties but
         shall not be assignable.

10.4     This Agreement may be executed in any number of counterparts all of
         which taken together shall constitute one and the same agreement and
         any of the parties hereto may execute this Agreement by signing such a
         counterpart.

10.5     Each of the parties hereto undertakes with the other or others of them
         to do, execute, perform or procure to be done executed or performed all
         such further acts, deeds, documents and things as such other or others
         of them may reasonably require to give effect to this Agreement or to
         conclude accounts or satisfy taxation authorities or legal requirements
         in relation to matters arising or periods ending on or prior to the
         Completion Date.


                                       6

<PAGE>
10.6     The Seller undertakes and agrees with each of the Buyers that until the
         Shares have been registered in the name of the Buyers in the register
         of members of the Company it will hold the legal interest in the Shares
         as trustee for the Buyers.

10.7     Except as expressly required by any Official Requirement or by any US
         or UK listing authority or the Securities and Exchange Commission all
         announcements or circulars by, for or on behalf of any of the parties
         and relating to any matter provided for in this Agreement shall be in
         a form approved in writing by or on behalf of the Seller's ultimate
         holding company and the Buyers in advance of issue (such approval not
         be unreasonably withheld or delayed).

11       NOTICES

11.1     Any notice pursuant to this Agreement shall be in writing signed by (or
         by some person duly authorised by) the person giving it and may be
         served by leaving it at or sending it by pre-paid, recorded delivery or
         registered post to, in the case of a notice to be served on any of the
         Buyers, the appropriate addresses set out in Schedule 1 to this
         Agreement or such other address or addresses as shall be notified to
         the Seller from time to time or, in the case of a notice to be served
         on the Seller, to its Registered Office for the time being. Any notice
         so served shall, if delivered by hand, be deemed to have been served
         when actually received by or on behalf of the person to be served and,
         if sent by post, be deemed to have been served 48 hours after it was
         posted and in proving service by post it shall be sufficient to prove
         that the envelope containing the same was correctly addressed and
         posted.

12       LAW

12.1     This Agreement shall be governed by and construed in all respects in
         accordance with English Law and the parties hereby irrevocably submit
         to the exclusive jurisdiction of the High Court of Justice in England.

AS WITNESS this Agreement has been signed by or on behalf of the parties hereto
the day and year first before written


                                       7
<PAGE>
                                   SCHEDULE 1



NAMES AND ADDRESSES OF THE BUYERS


Marshall Cooper
22 The Heights
Leek
Staffordshire
ST13 7LQ


John Clegg
Honey House
Viearage Lane
Long Compton
Shipston on Stour
CV36 5LH


                                       8
<PAGE>
                                   SCHEDULE 2

                              Conditions Precedent


The Conditions are that:

1        a creditors voluntary arrangement between the Company and its creditors
         is approved by the Company's creditors in accordance with Part 1 of the
         Insolvency Act 1986;

2        the Seller and KUK are each released from all their obligations under
         the Security Documents;

3        the creditors voluntary arrangement approved in satisfaction of
         condition 1 above envisages the Buyers continued involvement with the
         Company as owner/managers and includes:

         (a)      the payment in full of the Beldray VAT Liability by the
                  Company;

         (b)      the writing off of all outstanding intercompany balances owed
                  to the Company or its subsidiaries by any of their Related
                  Companies; and

         (c)      the payment by the Company to KUK of a lease guarantee fee
                  (the "Lease Guarantee Fee") equal to L1,000 per month (plus
                  any applicable VAT) for 24 months.

4        the Beldray VAT Liability is paid in full by the Company to HM Customs
         & Excise.

5        the Company enters into formal binding agreement(s) or undertaking:

         (a)      to pay the Lease Guarantee Fee;

         (b)      writing off all outstanding intercompany balances; and

         (c)      to refrain from agreeing to any changes to the terms of the
                  Lease without the prior written approval of KUK and to
                  reasonably promptly provide copies to KUK of any notices
                  served on the Company under the Lease.


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<PAGE>
<Table>
<Caption>
<S>                                          <C>
SIGNED by                                    ) /s/ Marshall Cooper
MARSHALL COOPER                              )
in the presence of:                          ) /s/ Paul Jones


SIGNED by                                    ) /s/ John Clegg
JOHN CLEGG                                   )
in the presence of:                          ) /s/ Paul Jones


SIGNED by ROBERT THORNTON                    ) /s/ Robert M. Thornton
for and on behalf of                         )
BRADLEY INTERNATIONAL LIMITED                )
in the presence of:                          )

W. BREWES                                      /s/ W. Brewes
Wragge & Co.
55 Celanove Row
</Table>


Wragge & Co. Document Id:\WRAGGE2\#2852247\R2M


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