Edgar Filing: ARMOR HOLDINGS INC

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

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

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

FORM 10-K/A
(AMENDMENT NO. 1)

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 For the fiscal year ended December 31, 2004
OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the transition period from ________ to __________

COMMISSION FILE NUMBER 0-18863

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

ARMOR HOLDINGS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

DELAWARE 59-3392443
(STATE OR OTHER JURISDICTION OF (IRS EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)

13386 INTERNATIONAL PARKWAY
JACKSONVILLE, FLORIDA 32218
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

(904) 741-5400
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
Title of each class: Common Stock, $0.01 par value
Name of each exchange on which registered: New York Stock Exchange

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
None

Indicate by check mark whether the Registrant: (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding twelve months (or for such shorter period that
the Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes [ x ] No [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of the Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K [ ]

Indicate by check mark whether the registrant is an accelerated filer
(as defined in rule 12B-2 of the Act)

Yes [ x ] No [ ]

The aggregate market value of voting and non-voting common equity held
by non-affiliates of the Registrant as of June 30, 2004, the last business day
of the Registrant's most recently completed second fiscal quarter (based on the
closing sale price of the Common Stock on the New York Stock Exchange on such
date) was $1,113,665,784.

The number of shares of the Registrant's Common Stock outstanding as of
April 27, 2005 was 34,535,765.

DOCUMENTS INCORPORATED BY REFERENCE

None

This Amendment is filed pursuant to General Instruction G(3) to Form
10-K for the sole purpose of filing the information required to be disclosed
pursuant to Part III of Form 10-K for the Company's fiscal year ended December
31, 2004, and to file the attached exhibits pursuant to Part IV of Form 10-K for
the Company's fiscal year ended December 31, 2004.

TABLE OF CONTENTS

Page Number
-----------

PART III Item 10. Directors and Executive Officers of the Registrant 4

Item 11. Executive Compensation 7

Item 12. Security Ownership of Certain Beneficial Owners
and Management and Related Stockholder Matters 17

Item 13. Certain Relationships and Related Transactions 22

Item 14. Principal Accounting Fees and Services 23

PART IV Item 15. Exhibits, Financial Statements and Schedules 24

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

DIRECTORS

Armor Holdings, Inc.'s (the "Company" or "Armor Holdings") Certificate
of Incorporation, as amended, and Amended and Restated Bylaws provide that the
Company may have between three and fifteen directors, with such number to be
fixed by the Board of Directors. The Company currently has six directors, but
the Board has expanded the number of directors to seven effective as of the
Annual Meeting of Stockholders of the Company, and will include Robert R.
Schiller as a director-nominee for election at the Annual Meeting of
Stockholders. The Company's directors are elected annually at the annual meeting
of stockholders. Their respective terms of office continue until the next annual
meeting of stockholders and until their successors have been elected and
qualified in accordance with the Company's Amended and Restated Bylaws. There
are no family relationships among any of our directors or executive officers.

The following persons are the current directors of the Company and Mr.
Schiller is a director-nominee:

WARREN B. KANDERS, 47, has served as the Founder and Chairman of the
Company's Board since January 1996 and as Chief Executive Officer since April 9,
2003. Mr. Kanders has served as a member of the Board of Directors of Clarus
Corporation since June 2002 and as the Executive Chairman of Clarus
Corporation's Board of Directors since December 2002, as the Executive Chairman
of the Board of Net Perceptions, Inc. since April 2004, and as the Chairman of
the Board of Directors of Langer, Inc. since November 2004. From October 1992 to
May 1996, Mr. Kanders served as Founder and Vice Chairman of the Board of Benson
Eyecare Corporation. Mr. Kanders also serves as President of Kanders & Company,
Inc., a private investment firm owned and controlled by Mr. Kanders that makes
investments in and renders consulting services to public and private entities.
Mr. Kanders received a B.A. degree in Economics from Brown University in 1979.

BURTT R. EHRLICH, 65, has served as one of the Company's directors
since January 1996. Mr. Ehrlich has served as a member of the Board of Directors
of Clarus Corporation since June 2002 and as a member of the Board of Directors
of Langer, Inc. since February 2001. Mr. Ehrlich served as Chairman and Chief
Operating Officer of Ehrlich Bober Financial Corp. (the predecessor of Benson
Eyecare Corporation) from December 1986 until October 1992, and as a director of
Benson Eyecare Corporation from October 1992 until November 1995.

DAVID R. HAAS, 63, has served as one of the Company's directors since
April 2004. Mr. Haas has served as a member of the Board of Directors of
Information Holdings, Inc. from July 1998 to December 2004. Since 1995, Mr. Haas
has been a private investor and a financial consultant specializing in financial
planning and financing in varying industries. From 1990 until 1994, Mr. Haas was
Senior Vice President and Controller of Time Warner, Inc., a leading media and
entertainment company. Prior to Warner Communications Inc.'s merger with Time
Inc. in 1990, Mr. Haas held various senior financial positions with Warner
Communications Inc.

ROBERT R. SCHILLER, 42, has served as the Company's President since
January 1, 2004 and Chief Operating Officer since April 2003. Mr. Schiller has
also held other positions at the Company and has served as an Executive Vice
President from November 2000 to April 2003, Chief Financial Officer and
Secretary from November 2000 to March 2004, as Executive Vice President and
Director of Corporate Development from January 1999 to October 2000, and as Vice
President of Corporate Development from July 1996 to December 1998. Mr. Schiller
graduated with a B.A. in Economics from Emory University in 1985 and received a
M.B.A. from Harvard Business School in 1991.

NICHOLAS SOKOLOW, 55, has served as one of the Company's directors
since January 1996. Mr. Sokolow has served as a member of the Board of Directors
of Clarus Corporation since June 2002. Mr. Sokolow has also served as a member
of the Board of Directors of Net Perceptions, Inc. since April 2004. Mr. Sokolow
has been a partner in the law firm of Sokolow, Carreras & Associates since 1994.
From June 1973 until October 1994, Mr. Sokolow was an associate and partner in
the law firm of Coudert Brothers.

THOMAS W. STRAUSS, 62, has served as one of the Company's directors
since May 1996. Mr. Strauss has served as a member of the Board of Directors of
Langer, Inc. from June 2002 to June 2004. Since 1995, Mr. Strauss has been a
principal with Ramius Capital Group, a privately held investment management
firm. From June 1993 until July 1995, Mr. Strauss was co-chairman of Granite
Capital International Group, an investment

banking firm. From 1963 to 1991, Mr. Strauss served in various capacities with
Salomon Brothers Inc., an investment banking and brokerage firm, including
President and Vice-Chairman.

DEBORAH A. ZOULLAS, 52, has served as one of the Company's directors
since July 2002. Ms. Zoullas is a private investor. From December 1998 until
December 2000, Ms. Zoullas served as the Executive Vice President of Sotheby's
Holdings, Inc. and during 2000 served on its Board of Directors. From 1974 until
1996, Ms. Zoullas worked in various capacities within the Investment Banking
Division of Morgan Stanley & Co. Incorporated. Ms. Zoullas is an Advisory
Director of Morgan Stanley, a member of the Advisory Board of The Stanford
Business School, a Director of the Helena Rubinstein Foundation and a member of
the Executive Committee of The Projects Committee of Memorial Sloan Kettering.

EXECUTIVE OFFICERS

The following table sets forth the name, age and position of each of
the Company's current executive officers. The Company's executive officers are
appointed by and serve at the discretion of the Board of Directors of the
Company.

NAME AGE POSITION
---- --- --------

Warren B. Kanders 47 Chairman of the Board of Directors and Chief Executive Officer
Robert R. Schiller 42 President and Chief Operating Officer
Glenn J. Heiar 45 Chief Financial Officer
Robert F. Mecredy 58 President - Aerospace & Defense Group
Scott T. O'Brien 51 President - Armor Holdings Products Division
Gary W. Allen 50 President - Mobile Security Division

See the caption "Directors" above for biographical data with respect to
Messrs. Kanders and Schiller.

GLENN J. HEIAR, 45, has served as the Company's Chief Financial Officer
since March 2004, Chief Accounting Officer since March 2003 and Chief Financial
Officer of the Company's Mobile Security Division since February 2002. From 1996
until 2001, Mr. Heiar was a Vice President and the Chief Financial Officer of
Pirelli Cables and Systems, North America. From 1987 to 1996, Mr. Heiar worked
for Alcatel Alsthom as a Financial Vice President and in various other financial
positions. Mr. Heiar graduated with a B.B.A. in Accounting from the University
of Wisconsin in 1982 and received a M.B.A. from the University of North Carolina
in 1992. Mr. Heiar is a certified public accountant and a certified management
accountant.

ROBERT F. MECREDY, 58, has served as President of the Company's
Aerospace & Defense Group since December 2003 and Corporate Vice President for
Government Affairs since October 2001. From 1991 to 2001, Mr. Mecredy worked at
Firearms Training Systems, Incorporated, holding positions ranging from Director
of U.S. Military Marketing and Sales through Chief Executive Officer, President
and Director. From 1988 to 1990, Mr. Mecredy served as the Director of Army and
Marine Corps programs for Raytheon's Washington, D.C. Office. Mr. Mecredy
actively served in the U.S. Army from 1966 through 1986 (when he was honorably
discharged) where he held positions of increasing responsibility, including,
among other positions, Deputy Director of the Army Staff and White House
Liaison. Mr. Mecredy graduated Summa Cum Laude from Park University with a B.S.
in Economics in 1974 and received a M.B.A. from Webster University in 1980.

SCOTT T. O'BRIEN, 51, has served as President of the Company's Products
Division since March 2005 and President and Chief Operating Officer of Safari
Land Ltd., Inc., one of our subsidiaries in our Products Division, since April
1999 when we acquired Safari Land Ltd., Inc. Since first joining Safari Land
Ltd., Inc. in 1974, Mr. O'Brien held progressively more responsible positions
before being appointed President and Chief Operating Officer in 1993. Mr.
O'Brien served as Vice President of Operations from 1988 until 1993; Vice
President of Manufacturing from 1985 until 1988; and Vice President of the Body
Armor Division from 1978 until 1985. Mr. O'Brien graduated with a B.A. in
Business Administration from California State University, Fullerton, in 1976.

GARY W. ALLEN, 50, has served as President of the Company's Mobile
Security Division, which includes O'Gara-Hess & Eisenhardt, AMS-France and
Germany, since October 2004. Mr. Allen began at O'Gara-Hess & Eisenhardt, as a
Plant Manager from 1994 - 1995. He spent the next several years in various
senior leadership positions including Senior V.P. Worldwide Operations and V.P.
Worldwide Operations. Preceding his career at

O'Gara, Mr. Allen spent 10 years with General Electric's Aircraft Engine plant,
fulfilling various roles in Supervision, Management, Production Control and
Operations. When Mr. Allen left GE he was Manager of Shop Operation's and
Structures, a $240 million dollar business. Before joining General Electric, Mr.
Allen served in the U.S. Navy Submarine Group. Mr. Allen was honorably
discharged from the U.S. Navy in 1979. Mr. Allen received an A.B.A. from the
University of Cincinnati in Industrial Management and graduated with a B.A. in
Business Administration from Wilmington College in 1992.

AUDIT COMMITTEE

The Company's Audit Committee consists of Mr. Haas (Chairman), Mr.
Strauss and Ms. Zoullas, all of whom were determined by the Board to be
independent of Armor Holdings based on the New York Stock Exchange's definition
of "independence". The Board of Directors has identified Mr. Haas as the audit
committee financial expert and has determined that Mr. Haas is independent based
on the New York Stock Exchange's definition of "independence".

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires that the Company's directors
and executive officers and any persons who own more than 10% of our capital
stock to file with the Securities and Exchange Commission (the "Commission")
(and, if such security is listed on a national securities exchange, with such
exchange), various reports as to ownership of such capital stock. Such persons
are required by Commission regulations to furnish the Company with copies of all
Section 16(a) forms they file.

Based solely upon reports and representations submitted by the
directors, executive officers and holders of more than 10% of our capital stock,
except as described below, all Forms 3, 4 and 5 showing ownership of and changes
of ownership in our capital stock during the 2004 fiscal year were timely filed
with the Commission and the New York Stock Exchange. The Form 3 filing for Mr.
Haas was filed on July 28, 2004, which was more than 10 days after he became a
director of the Company.

CODE OF ETHICS

The Company has adopted a Code of Ethics for Senior Executive and
Financial Officers and a Code of Business Conduct and Ethics for Directors,
Officers and Employees both of which apply to the Company's principal executive
officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions. The foregoing materials may
be accessed at www.armorholdings.com, our Internet website, at the tab "Investor
Relations." In addition, you may request, without charge, a copy of such
materials by submitting a written request for any of such materials to: Armor
Holdings, Inc., c/o the Secretary at 13386 International Parkway, Jacksonville,
Florida 32218.

ITEM 11. EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

The following summary compensation table sets forth information
concerning the annual and long-term compensation earned for the periods
presented below by the Company's chief executive officer and the Company's four
most highly compensated executive officers other than the Company's Chief
Executive Officer who were serving as executive officers at the end of fiscal
2004 and whose annual salary and bonus during fiscal 2004 exceeded $100,000
(collectively, the "Named Executive Officers").

LONG-TERM COMPENSATION
AWARDS
---------------------------------
RESTRICTED
ANNUAL COMPENSATION STOCK SECURITIES ALL OTHER
FISCAL SALARY BONUS AWARDS(1) UNDERLYING COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($) ($) ($) OPTIONS ($)
--------------------------- ------ ------- ------------ -------------- -------------- --------------

Warren B. Kanders 2004 525,000 1,000,000 499,969 (2) 250,000 68,149 (3)
Chairman of the Board 2003 382,000 400,000 4,552,005 (4) 300,000 143,000 (5)
and CEO 2002 - - 1,661,123 (6) 585,000 (7) 525,000 (5)

Robert R. Schiller 2004 500,000 1,000,000 499,969 (8) - 35,000 (9)
President and Chief 2003 432,638 400,000 3,314,017 (10) 200,000 -
Operating Officer 2002 320,000 - 2,471,554 (11) 50,000 -

Glenn J. Heiar 2004 300,000 262,500 87,461 (12) 100,000 13,525 (13)
Chief Financial Officer 2003 220,000 100,000 93,278 (14) - -
2002 198,423 - - 100,000 -

Robert F. Mecredy 2004 300,000 450,000 149,991 (15) - 15,000 (16)
President of Aerospace 2003 200,000 190,000 114,225 (17) 100,000 -
& Defense Group 2002 200,000 - - 25,000 -

Stephen E. Croskrey 2004 300,000 262,500 87,461 (19) - -
Former President and CEO of 2003 300,000 225,000 82,536 (20) - -
Armor Holdings Products 2002 300,000 - 31,419 (21) 200,000 -
Division (18)

(1) As of December 31, 2004, each Named Executive Officer owned the following
number of shares of restricted common stock (which number includes the
restricted stock awarded to such Named Executive Officer as bonus compensation
on February 10, 2005 but was included as compensation in fiscal 2004): Mr.
Kanders, 220,398, Mr. Schiller, 168,091, Mr. Heiar, 30,474, Mr. Mecredy, 32,651,
and Mr. Croskrey, 4,805. The value of the restricted common stock owned by each
Named Executive Officer as of December 31, 2004 was as follows: Mr. Kanders,
$10,363,114, Mr. Schiller, $7,903,639, Mr. Heiar, $1,432,887, Mr. Mecredy,
$1,535,250, and Mr. Croskrey, $225,931, and were calculated using the closing
price of our common stock on December 31, 2004 which was $47.02. No dividends,
to the extent declared and paid on our unrestricted common stock, will be paid
on our unvested restricted common stock.

(2) Represents the value of a stock bonus granted on February 10, 2005 (2004
bonus compensation which has been included as compensation in fiscal 2004)
pursuant to the 2002 Stock Incentive Plan. The number of shares issued pursuant
to the February 10, 2005 stock bonus was calculated using the closing price on
February 10, 2005 which was $44.76, as quoted on the New York Stock Exchange.
11,170 shares of restricted common stock were granted to Mr. Kanders on February
10, 2005 of which 3,723 shares vest on January 1, 2006 and 2007 and 3,724 shares
vest on January 1, 2008.

(3) Represents the amount paid to Mr. Kanders as a supplemental expense
reimbursement for expenses incurred by Mr. Kanders during fiscal 2003 and 2004
but excludes any office expense reimbursements paid in fiscal 2004. For more
information regarding office expense reimbursements paid to Mr. Kanders, please
see "Employment Agreements - Warren B. Kanders" and "Certain Relationships and
Related Transactions," respectively. In addition to the information disclosed in
the table: (i) on January 3, 2005, Mr. Kanders was granted presently exercisable
stock options to purchase 150,000 shares at an exercise price of $45.93 per
share; sales of common stock issued upon an exercise of any such options are
subject to the following lock-up restrictions: 50,000 shares will be restricted
from sale until January 3, 2006; 50,000 shares will be restricted from sale
until January 3, 2007; and 50,000 shares will be restricted from sale until
January 3, 2008; in addition, upon Mr. Kanders' voluntary termination of
employment with the Company, any of the foregoing lock-up periods which have not
yet expired shall be extended for an additional five year period; and (ii) on
March 25, 2005, Mr. Kanders was granted presently exercisable stock options to
purchase 328,800 shares at an exercise price of $37.90 per share; sales of
common stock issued upon an exercise of any such options will be subject to the
following lock-up restrictions: 50,000 shares will be restricted from sale until
January 1, 2007; 100,000 shares will be restricted from sale until January 1,
2008; 128,800 shares will be restricted from sale until January 1, 2009; and
50,000 shares will be restricted from sale until January 1, 2010; in addition,
upon Mr. Kanders' voluntary termination of employment with the Company, if the
foregoing lock-up periods have not yet expired, they shall each be extended for
an additional five year period.

(4) Represents the value of stock bonuses granted on July 26, 2003 and February
10, 2004 (2003 bonus compensation which has been included as compensation in
fiscal 2003) pursuant to the 2002 Stock Incentive Plan. The number of shares
issued pursuant to the February 10, 2004 stock bonus was calculated using the
closing price on February 10, 2004 which was $28.90, as quoted on the New York
Stock Exchange. 200,000 shares of restricted common stock were granted to Mr.
Kanders on July 26, 2003; such shares vested on November 11, 2003 and have been
deferred until the earlier of November 11, 2008 and two years of continuous
employment by Mr. Kanders with Armor Holdings; the delivery of such restricted
stock has been accelerated by Armor Holdings and were delivered on or about
April 26, 2005 less a certain number of shares necessary to pay applicable
withholding taxes payable upon receipt of such shares. The accelerated and
delivered restricted shares are subject to a lock-up period through November 11,
2005; upon Mr. Kanders' voluntary termination of employment with the Company, if
the foregoing lock-up period has not yet expired, it shall be extended for an
additional five year period; upon a change in control of the Company, the
lock-up period that is still in effect in respect of such shares upon the
occurrence of such change in control shall terminate. We calculated the value of
the July 26, 2003 stock bonus using the closing price of our common stock, as
quoted on the New York Stock Exchange, on November 11, 2003, the date on which
such stock bonus vested. The closing price of our common stock on the New York
Stock Exchange on November 11, 2003 was $20.76. 13,841 shares of restricted
common stock were granted to Mr. Kanders on February 10, 2004 of which 4,613
shares vest on February 9, 2005 and 4,614 shares vest on each of February 9,
2006 and February 9, 2007.

(5) Represents the compensation paid to Kanders & Co., Inc. ("Kanders & Co."), a
corporation controlled by Mr. Kanders, for investment banking services provided
to Armor Holdings.

(6) Represents the value of stock bonuses granted on August 12, 2002 pursuant to
the 2002 Stock Incentive Plan. The number of shares issued pursuant to these
bonuses was calculated using the closing price on August 12, 2002 of $15.04 as
quoted on the New York Stock Exchange. 100,000 shares of restricted common stock
were granted to Mr. Kanders on August 12, 2002 which vest on December 31, 2016,
subject to acceleration under certain circumstances, including, among other
things, the vesting of 75% of such shares upon us achieving $100 million of
earnings before interest, taxes, depreciation and amortization ("EBITDA") during
any rolling four-quarter period and the vesting of the remaining 25% of such
shares upon us achieving $125 million of EBITDA during any rolling four-quarter
period. Such shares vested in fiscal 2004. 10,447 shares of restricted common
stock were granted to Kanders & Co. on August 12, 2002 and such shares vested on
December 31, 2004.

(7) The securities underlying options granted to Mr. Kanders during 2002 include
35,000 shares of common stock underlying an option granted to Kanders & Co.

(8) Represents the value of a stock bonus granted on February 10, 2005 (2004
bonus compensation which has been included as compensation in fiscal 2004)
pursuant to the 2002 Stock Incentive Plan. The number of shares issued pursuant
to the February 10, 2005 stock bonus was calculated using the closing price on
February 10, 2005 which was $44.76, as quoted on the New York Stock Exchange.
11,170 shares of restricted common stock were granted to Mr. Schiller on
February 10, 2005 of which 3,723 shares vest on January 1, 2006 and 2007 and
3,724 shares vest on January 1, 2008.

(9) Represents the amount paid to Mr. Schiller as a supplemental expense
reimbursement for expenses incurred by Mr. Schiller during fiscal 2004. In
addition to the information disclosed in the table: (i) on January 3, 2005, Mr.
Schiller was granted presently exercisable stock options to purchase 100,000
shares at an exercise price of $45.93 per share; sales of common stock issued
upon an exercise of any such options are subject to the following lock-up
restrictions: 33,333 shares will be restricted from sale until January 3, 2006;
33,333 shares will be restricted from sale until January 3, 2007; and 33,334
shares will be restricted from sale until January 3, 2008; in addition, upon Mr.
Schiller's voluntary termination of employment with the Company, any of the
foregoing lock-up periods which have not yet expired shall be extended for an
additional five year period; and (ii) on March 25, 2005, Mr. Schiller was
granted presently exercisable stock options to purchase 219,200 shares at an
exercise price of $37.90 per share; sales of common stock issued upon an
exercise of any such options will be subject to the following lock-up
restrictions: 33,333 shares will be restricted from sale until January 1, 2007;
66,666 shares will be restricted from sale until January 1, 2008; 85,867 shares
will be restricted from sale until January 1, 2009; and 33,334 shares will be
restricted from sale until January 1, 2010; in addition, upon Mr. Schiller's
voluntary termination of employment with the Company, any of the foregoing
lock-up periods which have not yet expired shall be extended for an additional
five year period.

(10) Represents the value of stock bonuses granted on November 4, 2003 and
February 10, 2004 (2003 bonus compensation which has been included as
compensation in fiscal 2003) pursuant to the 2002 Stock Incentive Plan. The
number of shares issued pursuant to the February 10, 2004 stock bonus was
calculated using the closing price on February 10, 2004 which was $28.90, as
quoted on the New York Stock Exchange. 150,000 shares of restricted common stock
were granted to Mr. Schiller on November 4, 2003; such shares vested on November
11, 2003 and have been deferred until the earlier of November 11, 2008, and two
years of continuous employment by Mr. Schiller with Armor Holdings the delivery
of such restricted stock has been accelerated by Armor Holdings and were
delivered on or about April 26, 2005 less a certain number of shares necessary
to pay applicable withholding taxes payable upon receipt of such shares. The
accelerated and delivered restricted shares are subject to a lock-up period
through November 11, 2005; upon Mr. Schiller's voluntary termination of
employment with the Company, if the foregoing lock-up period has not yet
expired, it shall be extended for an additional five year period; upon a change
in control of the Company, the lock-up period that is still in effect in respect
of such shares upon the occurrence of such change in control shall terminate. We
calculated the value of the November 4, 2003 stock bonus using the closing price
of our common stock, as quoted on the New York Stock Exchange, on November 11,
2003, the date on which such stock bonus vested. The closing price of our common
stock on the New York Stock Exchange on November 11, 2003 was $20.76. 6,921
shares of restricted common stock were granted to Mr. Schiller on February 10,
2004 and such shares vest on February 9, 2007.

(11) Represents the value of stock bonuses granted on March 13, 2002 and August
12, 2002 pursuant to the 2002 Executive Stock Plan and the 2002 Stock Incentive
Plan. The number of shares issued pursuant to these bonuses was calculated using
the closing price on March 13, 2002 and August 12, 2002 which was $23.93 and
$15.04, respectively, as quoted on the New York Stock Exchange. 100,000 shares
of restricted common stock were granted to Mr. Schiller pursuant to the 2002
Executive Stock Plan on March 13, 2002 which vest on December 31, 2016, subject
to acceleration under certain circumstances, including, among other things, the
vesting of 75% of such shares upon us achieving $100 million of EBITDA during
any rolling four-quarter period and the vesting of the remaining 25% of such
shares upon us achieving $125 million of EBITDA during any rolling four-quarter
period. Such shares vested in fiscal 2004. 5,223 shares of restricted common
stock were granted to Mr. Schiller pursuant to the 2002 Stock Incentive Plan on
August 12, 2002 and such shares vested on December 31, 2004.

(12) Represents the value of a stock bonus granted on February 10, 2005 (2004
bonus compensation which has been included as compensation in fiscal 2004)
pursuant to the 2002 Stock Incentive Plan. The number of

shares issued pursuant to the February 10, 2005 stock bonus was calculated using
the closing price on February 10, 2005 which was $44.76, as quoted on the New
York Stock Exchange. 1,954 shares of restricted common stock were granted to Mr.
Heiar on February 10, 2005 of which 651 shares vest on each of January 1, 2006
and 2007, and 652 shares vest on January 1, 2008.

(13) Represents the amount paid to Mr. Heiar as a supplemental expense
reimbursement for expenses incurred by Mr. Heiar during fiscal 2004. In addition
to the information disclosed in the table, Mr. Heiar was granted: (i) 25,000
shares of restricted stock on February 10, 2005, which will vest upon a change
of control of the Company; (ii) presently exercisable stock options to purchase
25,000 shares on February 10, 2005, at an exercise price of $44.76; sales of
common stock issued upon an exercise of any such options will be subject to the
following lock-up restrictions: all of the shares will be restricted from sale
for two years from February 10, 2005 (the "Vesting Date"), 75% of the shares
will be restricted from sale for three years from the Vesting Date, 50% of the
shares will be restricted from sale for four years from the Vesting Date, and
25% of the shares will be restricted from sale for five years from the Vesting
Date; and (iii) presently exercisable stock options to purchase 75,000 shares on
March 25, 2005, at an exercise price of $37.90 per share; sales of common stock
issued upon an exercise of any such options will be subject to the following
lock-up restrictions: 6,250 shares will be restricted from sale until January 1,
2008; 12,500 shares will be restricted from sale until January 1, 2009; 18,750
shares will be restricted from sale until January 1, 2010; 18,750 shares will be
restricted from sale until January 1, 2011; 12,500 shares will be restricted
from sale until January 1, 2012; and 6,250 shares will be restricted from sale
until January 1, 2013; in addition, upon Mr. Heiar's voluntary termination of
employment with the Company, any of the foregoing lock-up periods which have not
yet expired shall be extended for an additional five year period.

(14) Represents the value of stock bonuses granted on March 21, 2003 and March
15, 2004 (2003 bonus compensation which has been included as compensation in
fiscal 2003) pursuant to the 2002 Stock Incentive Plan. The number of shares
issued pursuant to these bonuses was calculated using the closing price on March
21, 2003 and March 12, 2004 which was $9.87 and $28.95, respectively, as quoted
on the New York Stock Exchange. 5,000 shares of restricted common stock were
granted to Mr. Heiar on March 21, 2003 of which 1,500 shares have vested, 1,500
shares vest on December 31, 2004 and 2,000 shares vest on December 31, 2005.
1,520 shares of restricted common stock were granted to Mr. Heiar on March 15,
2004 which shares vest on December 31, 2006.

(15) Represents the value of a stock bonus granted on February 10, 2005 (2004
bonus compensation which has been included as compensation in fiscal 2004)
pursuant to the 2002 Stock Incentive Plan. The number of shares issued pursuant
to the February 10, 2005 stock bonus was calculated using the closing price on
February 10, 2005 which was $44.76, as quoted on the New York Stock Exchange.
3,351 shares of restricted common stock were granted to Mr. Mecredy on February
10, 2005 of which 1,117 shares vest on each of January 1, 2006, 2007 and 2008.

(16) Represents the amount paid to Mr. Mecredy as a supplemental expense
reimbursement for expenses incurred by Mr. Mecredy during fiscal 2004. In
addition to the information disclosed in the table, Mr. Mecredy was granted: (i)
25,000 shares of restricted stock on February 10, 2005, which will vest upon a
change of control of the Company; (ii) presently exercisable stock options to
purchase 75,000 shares on February 10, 2005, at an exercise price of $44.76;
sales of common stock issued upon an exercise of any such options will be
subject to the following lock-up restrictions: all of the shares will be
restricted from sale for two years from February 10, 2005 (the "Vesting Date"),
75% of the shares will be restricted from sale for three years from the Vesting
Date, 50% of the shares will be restricted from sale for four years from the
Vesting Date, and 25% of the shares will be restricted from sale for five years
from the Vesting Date; and (iii) presently exercisable stock options to purchase
75,000 shares on March 25, 2005, at an exercise price of $37.90 per share; sales
of common stock issued upon an exercise of any such options will be subject to
the following lock-up restrictions: 6,250 shares will be restricted from sale
until January 1, 2008; 12,500 shares will be restricted from sale until January
1, 2009; 18,750 shares will be restricted from sale until January 1, 2010;
18,750 shares will be restricted from sale until January 1, 2011; 12,500 shares
will be restricted from sale until January 1, 2012; and 6,250 shares will be
restricted from sale until January 1, 2013; in addition, upon Mr. Mecredy's
voluntary termination of employment with the Company, any of the foregoing
lock-up periods which have not yet expired shall be extended for an additional
five year period.

(17) Represents the value of stock bonuses granted on March 21, 2003 and March
15, 2004 (2003 bonus compensation which has been included as compensation in
fiscal 2003) pursuant to the 2002 Stock Incentive Plan. The number of shares
issued pursuant to these bonuses was calculated using the closing price on March
21, 2003 and March 12, 2004 which was $9.87 and $28.95, respectively, as quoted
on the New York Stock

Exchange. 6,000 shares of restricted common stock were granted to Mr. Mecredy on
March 21, 2003 of which 1,800 shares have vested, 1,800 shares vest on December
31, 2004 and 2,400 shares vest on December 31, 2005. 1,900 shares of restricted
common stock were granted to Mr. Mecredy on March 15, 2004 which shares vest on
December 31, 2006.

(18) Mr. Croskrey, our former President and CEO, Products Division, terminated
his employment with the Company effective March 7, 2005, and the information
contained in this table is as of that date. For more information see the
Employment Agreement section below.

(19) Represents the value of a stock bonus granted on February 10, 2005 (2004
bonus compensation which has been included as compensation in fiscal 2004)
pursuant to the 2002 Stock Incentive Plan. The number of shares issued pursuant
to the February 10, 2005 stock bonus was calculated using the closing price on
February 10, 2005 which was $44.76, as quoted on the New York Stock Exchange.
1,954 shares of restricted common stock were granted to Mr. Croskrey on February
10, 2005 which vest on March 8, 2008. In addition, on February 10, 2005, Mr.
Croskrey was granted stock options to purchase 10,000 shares at an exercise
price of $44.76 which were accelerated on March 7, 2005 and are presently
exercisable; sales of common stock issued upon an exercise of any such options
will be subject to a lock-up restriction through March 7, 2008, and the shares
will be held by Armor Holdings as collateral to secure Mr. Croskrey's
obligations under the Resignation and Severance Agreement and General Release he
executed with Armor Holdings.

(20) Represents the value of stock bonuses granted on March 15, 2004 (2003 bonus
compensation which has been included as compensation in fiscal 2003) pursuant to
the 2002 Stock Incentive Plan. The number of shares issued pursuant to these
bonuses was calculated using the closing price on March 12, 2004 which was
$28.95 as quoted on the New York Stock Exchange. Pursuant to such calculations,
2,851 shares of restricted common stock were granted to Mr. Croskrey and such
shares vest on December 31, 2006.

(21) Represents the value of stock bonuses granted on August 12, 2002 pursuant
to the 2002 Stock Incentive Plan. The number of shares issued pursuant to these
bonuses was calculated using the closing price on August 12, 2002 which was
$15.04 as quoted on the New York Stock Exchange. Pursuant to such calculations,
2,089 shares of restricted common stock were granted to Mr. Croskrey and such
shares vested on December 31, 2004.

OPTIONS GRANTED IN FISCAL 2004

The Company granted the following options to its Named Executive Officers during
fiscal 2004.

INDIVIDUAL GRANTS POTENTIAL REALIZABLE
----------------------------------------------------------------------------------- VALUE AT ASSUMED ANNUAL
NUMBER OF PERCENT OF RATES OF STOCK PRICE
SECURITIES TOTAL OPTIONS APPRECIATION FOR OPTION
UNDERLYING GRANTED TO EXERCISE OR TERM
OPTIONS EMPLOYEES BASE PRICE EXPIRATION ------------------------
NAME GRANTED (#) IN FISCAL YEAR ($/SH) DATE 5% ($) 10% ($)
--------------------- ----------- -------------- ----------- ---------- --------- -----------
Warren B. Kanders 250,000 (1) 25.5% 28.90 2/10/14 4,543,764 11,514,789
Robert R. Schiller - (2) - - - - -
Glenn J. Heiar 100,000 (3) 10.2% 28.46 3/11/14 1,789,834 4,535,791
Robert F. Mecredy - (4) - - - - -
Stephen E. Croskrey - (5) - - - - -
------------------------------------------------------------------------------------------------------------------

(1) In addition to the information disclosed in the table: (i) on January 3,
2005, Mr. Kanders was granted presently exercisable stock options to purchase
150,000 shares at an exercise price of $45.93 per share; sales of common stock
issued upon an exercise of any such options are subject to the following lock-up
restrictions:

50,000 shares will be restricted from sale until January 3, 2006; 50,000 shares
will be restricted from sale until January 3, 2007; and 50,000 shares will be
restricted from sale until January 3, 2008; in addition, upon Mr. Kanders'
voluntary termination of employment with the Company, any of the foregoing
lock-up periods which have not yet expired shall be extended for an additional
five year period; and (ii) on March 25, 2005, Mr. Kanders was granted presently
exercisable stock options to purchase 328,800 shares at an exercise price of
$37.90 per share; sales of common stock issued upon an exercise of any such
options will be subject to the following lock-up restrictions: 50,000 shares
will be restricted from sale until January 1, 2007; 100,000 shares will be
restricted from sale until January 1, 2008; 128,800 shares will be restricted
from sale until January 1, 2009; and 50,000 shares will be restricted from sale
until January 1, 2010; in addition, upon Mr. Kanders' voluntary termination of
employment with the Company, if the foregoing lock-up periods have not yet
expired, they shall each be extended for an additional five year period.

(2) In addition to the information disclosed in the table: (i) on January 3,
2005, Mr. Schiller was granted presently exercisable stock options to purchase
100,000 shares at an exercise price of $45.93 per share; sales of common stock
issued upon an exercise of any such options are subject to the following lock-up
restrictions: 33,333 shares will be restricted from sale until January 3, 2006;
33,333 shares will be restricted from sale until January 3, 2007; and 33,334
shares will be restricted from sale until January 3, 2008; in addition, upon Mr.
Schiller's voluntary termination of employment with the Company, any of the
foregoing lock-up periods which have not yet expired shall be extended for an
additional five year period; and (ii) on March 25, 2005, Mr. Schiller was
granted presently exercisable stock options to purchase 219,200 shares at an
exercise price of $37.90 per share; sales of common stock issued upon an
exercise of any such options will be subject to the following lock-up
restrictions: 33,333 shares will be restricted from sale until January 1, 2007;
66,666 shares will be restricted from sale until January 1, 2008; 85,867 shares
will be restricted from sale until January 1, 2009; and 33,334 shares will be
restricted from sale until January 1, 2010; in addition, upon Mr. Schiller's
voluntary termination of employment with the Company, any of the foregoing
lock-up periods which have not yet expired shall be extended for an additional
five year period.

(3) In addition to the information disclosed in the table, Mr. Heiar was
granted: (i) presently exercisable stock options to purchase 25,000 shares on
February 10, 2005, at an exercise price of $44.76; sales of common stock issued
upon an exercise of any such options will be subject to the following lock-up
restrictions: all of the shares will be restricted from sale for two years from
February 10, 2005 (the "Vesting Date"), 75% of the shares will be restricted
from sale for three years from the Vesting Date, 50% of the shares will be
restricted from sale for four years from the Vesting Date, and 25% of the shares
will be restricted from sale for five years from the Vesting Date; and (ii)
presently exercisable stock options to purchase 75,000 shares on March 25, 2005,
at an exercise price of $37.90 per share; sales of common stock issued upon an
exercise of any such options will be subject to the following lock-up
restrictions: 6,250 shares will be restricted from sale until January 1, 2008;
12,500 shares will be restricted from sale until January 1, 2009; 18,750 shares
will be restricted from sale until January 1, 2010; 18,750 shares will be
restricted from sale until January 1, 2011; 12,500 shares will be restricted
from sale until January 1, 2012; and 6,250 shares will be restricted from sale
until January 1, 2013; in addition, upon Mr. Heiar's voluntary termination of
employment with the Company, any of the foregoing lock-up periods which have not
yet expired shall be extended for an additional five year period.

(4) In addition to the information disclosed in the table, Mr. Mecredy was
granted: (i) presently exercisable stock options to purchase 75,000 shares on
February 10, 2005, at an exercise price of $44.76; sales of common stock issued
upon an exercise of any such options will be subject to the following lock-up
restrictions: all of the shares will be restricted from sale for two years from
February 10, 2005 (the "Vesting Date"), 75% of the shares will be restricted
from sale for three years from the Vesting Date, 50% of the shares will be
restricted from sale for four years from the Vesting Date, and 25% of the shares
will be restricted from sale for five years from the Vesting Date; and (ii)
presently exercisable stock options to purchase 75,000 shares on March 25, 2005,
at an exercise price of $37.90 per share; sales of common stock issued upon an
exercise of any such options will be subject to the following lock-up
restrictions: 6,250 shares will be restricted from sale until January 1, 2008;
12,500 shares will be restricted from sale until January 1, 2009; 18,750 shares
will be restricted from sale until January 1, 2010; 18,750 shares will be
restricted from sale until January 1, 2011; 12,500 shares will be restricted
from sale until January 1, 2012; and 6,250 shares will be restricted from sale
until January 1, 2013; in addition, upon Mr. Mecredy's voluntary termination of
employment with the Company, any of the foregoing lock-up periods which have not
yet expired shall be extended for an additional five year period.

(5) On February 10, 2005, Mr. Croskrey was granted stock options to purchase
10,000 shares at an exercise price of $44.76 which were accelerated on March 7,
2005 and are presently exercisable; sales of common stock

issued upon an exercise of any such options will be subject to a lock-up
restriction through March 7, 2008, and the shares will be held by Armor Holdings
as collateral to secure Mr. Croskrey's obligations under the Resignation and
Severance Agreement and General Release he executed with Armor Holdings.

AGGREGATE OPTION EXERCISES IN FISCAL 2004 AND FISCAL YEAR END OPTION VALUES

The following table contains certain information regarding stock
options exercised during fiscal 2004 and options to purchase the Company's
common stock held as of December 31, 2004, by each of the Named Executive
Officers. The stock options listed below were granted without tandem stock
appreciation rights. The Company has no freestanding stock appreciation rights
outstanding.

NUMBER OF SECURITIES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS AT 12/31/04 IN-THE-MONEY OPTIONS AT
(#) 12/31/04 (1)
SHARES --------------------------------- ---------------------------------
ACQUIRED VALUE
ON EXERCISE REALIZED EXERCISABLE NON-EXERCISABLE EXERCISABLE NON-EXERCISABLE
NAME (#) (2)($) ($) ($)
------------------------ --------------- ------------- --------------- ---------------- --------------- ----------------

Warren B. Kanders 204,375 6,175,087 443,125 700,000 11,238,363 16,807,500
Robert R. Schiller 224,306 6,287,171 217,360 183,334 6,367,001 5,585,187
Glenn J. Heiar 41,818 704,094 8,182 150,000 206,759 3,119,500
Robert F. Mecredy 50,000 1,124,201 - 75,000 - 2,192,746
Stephen E. Croskrey 250,000 5,736,845 100,000 - 2,309,000 -

(1) Calculated on the basis of $47.02 per share, the closing sales price of the
common stock on the New York Stock Exchange on December 31, 2004, less the
exercise price payable for such shares.

(2) Calculated on the basis of the closing share price of the common stock on
the New York Stock Exchange on the date of exercise, less the exercise price
paid for such shares.

On March 25, 2005, the Board of Directors accelerated the vesting
schedule of all of the unvested and non-exercisable options owned by the Named
Executive Officers. The following table contains updated information regarding
options to purchase common stock as of March 31, 2005 by each of the Named
Executive Officers, all of which are presently exercisable and subject to
lock-up restrictions of varying durations which are expected to expire in the
period from 2005 to 2010, which coincides with their original vesting schedules.
The stock options listed below were granted without tandem stock appreciation
rights. The Company has no freestanding stock appreciation rights outstanding.

NUMBER OF SECURITIES VALUE OF UNDERLYING
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS AT
OPTIONS AT 3/31/05 (#) 3/31/05 (1)
------------------------------- -------------------------------

SHARES NOT SHARES SHARES NOT SHARES
SUBJECT TO SUBJECT TO SUBJECT TO SUBJECT TO
LOCK-UP LOCK-UP LOCK-UP LOCK-UP
NAME ($) ($)
---------------------- --------------- ---------------- ----------- -----------

Warren B. Kanders 526,458 1,095,467 7,520,629 9,174,003
Robert R. Schiller 217,360 502,534 4,208,616 3,764,680
Glenn J. Heiar 74,391 180,000 1,006,958 690,400
Robert F. Mecredy 8,334 216,666 116,676 1,331,320
Stephen E. Croskrey - 10,000 - -

(1) Calculated on the basis of $37.09 per share, the closing sales price of the
common stock on the New York Stock Exchange on March 31, 2005, less the exercise
price payable for such shares.

COMPENSATION OF DIRECTORS

On July 26, 2004, the Company's directors, other than Mr. Kanders who
was compensated pursuant to his employment agreement, received stock options to
purchase up to 12,500 shares of our common stock at an exercise price of $35.40
per share, of which options to purchase 3,125 shares of common stock were to
vest at the end of each fiscal quarter thereafter. On March 25, 2005, the Board
of Directors approved an accelerated grant of 37,500 options to each of the
non-management directors. However, due to limited availability under the 2002
Stock Incentive Plan, such options were not issued at such time. If a new stock
incentive plan is approved by the Company's stockholders at the 2005 Annual
Meeting of Stockholders, Armor Holdings will grant such options to the
non-management directors as approved by the Board of Directors. In addition to
the foregoing, the non-management directors of Armor Holdings will receive cash
in the amount of $16,000 which is payable quarterly during the course of the
year. Non-attendance by a member of the Board at any Board meeting will result
in a reduction of $2,000 in compensation for each missed meeting. In addition,
the Chairs of the Nominating/Corporate Governance Committee and the Audit
Committee will each be paid $25,000 to serve as the Chair of such committee.
Members of a Board Committee will each be paid $5,000, except for the Chairs of
the Nominating/Corporate Governance Committee and the Audit Committee who will
each be paid the Chair compensation set forth in the immediately preceding
sentence. For the year commencing from and after the 2005 Annual Meeting of
Stockholders, the Chairs of the Nominating/Corporate Governance Committee and
the Audit Committee will each be paid $50,000 to serve as the Chair of such
Committee, which will be payable quarterly during the course of the year. The
members of the Board are reimbursed by us for their travel and other expenses
incurred by them in connection with company business. If Mr. Schiller is elected
to the Board of Directors, he will be compensated pursuant to his employment
agreement and will not be entitled to receive the compensation that is paid to
our non-management directors.

EMPLOYMENT AGREEMENTS

Other than as set forth below, as of April 27, 2005, the Company did
not have any employment agreements with its Named Executive Officers. However,
the Company is in the process of negotiating employment agreements with certain
of its executive officers, including a new employment agreement with Mr.
Kanders, and the Company anticipates disclosing the terms of such employment
agreements in the proxy statement for the 2005 Annual Meeting of Stockholders
which will be filed with the Commission subsequent to the filing of this Annual
Report on Form 10-K/A (Amendment No. 1).

WARREN B. KANDERS

As of January 1, 2002, we entered into an employment agreement with
Warren B. Kanders which provides that he will serve as the Executive Chairman of
our Board of Directors for a five year term expiring December 31, 2006, for
which Mr. Kanders received options to purchase 550,000 shares of common stock,
of which 75,000 shares can be acquired at an exercise price of $23.93 and the
remaining 475,000 shares can be acquired at an exercise price of $24.07. These
options vest as follows: 100,000 options vested on each of December 31, 2002,
December 31, 2003 and December 31, 2004 and 250,000 options vest on December 31,
2006. Mr. Kanders also received a restricted stock grant of 100,000 shares,
which vested in fiscal 2004. On August 12, 2002, we also granted to Mr. Kanders
a restricted stock award in the amount of 10,447 shares pursuant to our 2002
Stock Incentive Plan which vested on December 31, 2004. Pursuant to his
employment agreement, Mr. Kanders may be entitled, at the discretion of the
Compensation Committee of the board, to participate in the other option plans
and other bonus plans we have adopted based on his performance and our overall
performance. A "change in control" of Armor Holdings will allow Mr. Kanders to
terminate his employment agreement and Mr. Kanders will be entitled to the
vesting of all 550,000 options and 100,000 restricted stock grants granted to
him under the employment agreement. Mr. Kanders will also be entitled to
acceleration of such vesting on the options and restricted stock grants upon the
termination of his employment agreement by us without cause. Furthermore, in the
event the employment agreement is terminated by Mr. Kanders due to the
occurrence of a change in control or terminated by Armor Holdings without cause,
Mr. Kanders shall be entitled to receive, in one lump sum, within 5 business
days of the occurrence of the change in control or his termination by Armor
Holdings without cause, the greater of his base compensation throughout the term
of the employment agreement or twice his annual base compensation. A termination
for cause will result in the termination of any unvested options and restricted
stock grants. In the event Mr. Kanders terminates the employment agreement,
other than due to a change in control, all vested options and restricted stock
grants granted to Mr. Kanders shall remain subject to the terms of the agreement
by which such options and restricted stock grants were issued, and

the unvested portion of such options and restricted stock grants shall
terminate. A termination of the employment agreement due to Mr. Kanders' death
or disability will result in the termination of the unvested portion of the
restricted stock awarded pursuant to Mr. Kanders' employment agreement. Mr.
Kanders has also agreed to certain confidentiality and non-competition
provisions. Mr. Kanders' employment agreement also contains other provisions
that are customary for agreements of this type.

Effective April 9, 2003, Mr. Kanders was also appointed to serve as our
Chief Executive Officer pursuant to an amendment dated July 26, 2003 to his
employment agreement. Pursuant to his employment with Armor Holdings, Mr.
Kanders shall receive a base salary in the amount of $525,000. On July 26, 2003,
Mr. Kanders received from us 200,000 shares of restricted stock pursuant to our
2002 Stock Incentive Plan. Under the terms of the restricted stock award, which
were amended in Amendment No. 2 to Mr. Kanders' employment agreement, dated as
of November 4, 2003, all of the 200,000 shares of restricted stock will vest on
the date the closing price of our common stock on the New York Stock Exchange
shall equal $20 per share or more; provided that such $20 price per share is
attained on or before July 26, 2006, and maintained for five consecutive trading
days; provided, further, that the payment of such restricted stock bonus award
will be deferred for a period of five years after the vesting date, subject to
certain acceleration provisions. On November 11, 2003, the 200,000 share
restricted stock award vested in its entirety; provided that the payment of such
restricted stock award was deferred until the earlier of November 11, 2008 and
two years of continuous employment by Mr. Kanders with the Company; the delivery
of such restricted stock has been accelerated by the Company and were delivered
on or about April 26, 2005 less a certain number of shares necessary to pay
applicable withholding taxes payable upon receipt of such shares. The restricted
shares are subject to a lock-up period through November 11, 2005; upon Mr.
Kanders' voluntary termination of employment with the Company, if the foregoing
lock-up period has not yet expired, it shall be extended for an additional five
year period; upon a change in control of the Company, the lock-up period that is
still in effect in respect of such shares upon the occurrence of such change in
control shall terminate. Mr. Kanders also received from us on July 26, 2003
300,000 stock options to purchase our common stock from us at an exercise price
of $14.32 per share pursuant to our 2002 Stock Incentive Plan, which stock
options were accelerated on March 25, 2005 and are presently exercisable; sales
of common stock issued upon an exercise of any such options are subject to the
following lock-up restrictions: 100,000 shares will be restricted from sale
until each of July 26, 2005 and 2006; in addition, upon Mr. Kanders' voluntary
termination of employment with the Company, any of the foregoing lock-up periods
which have not yet expired shall be extended for an additional five year period.
On February 10, 2004, we granted to Mr. Kanders (i) 250,000 stock options to
purchase our common stock from us at an exercise price of $28.90 per share
pursuant to our 2002 Stock Incentive Plan, which stock options were accelerated
on March 25, 2005 and are presently exercisable; sales of common stock issued
upon an exercise of any such options are subject to the following lock-up
restrictions: 83,333 shares will be restricted from sale until January 1, 2006
and 83,334 shares will be restricted from sale until January 1, 2007; in
addition, upon Mr. Kanders' voluntary termination of employment with the
Company, any of the foregoing lock-up periods which have not yet expired shall
be extended for an additional five year period; and (ii) a restricted stock
grant of 13,841 shares pursuant to our Stock Incentive Plan of which 4,613
vested on February 9, 2005 and 4,614 vest on each of February 9, 2006 and 2007.
In addition, on January 3, 2005, Mr. Kanders was granted presently exercisable
stock options to purchase 150,000 shares at an exercise price of $45.93 per
share pursuant to our 2002 Stock Incentive Plan; sales of common stock issued
upon an exercise of any such options are subject to the following lock-up
restrictions: 50,000 shares will be restricted from sale until January 3, 2006;
50,000 shares will be restricted from sale until January 3, 2007; and 50,000
shares will be restricted from sale until January 3, 2008; in addition, upon Mr.
Kanders' voluntary termination of employment with the Company, any of the
foregoing lock-up periods which have not yet expired shall be extended for an
additional five year period. In addition, we granted to Mr. Kanders on February
10, 2005 a restricted stock award of 11,170 shares pursuant to our 2002 Stock
Incentive Plan of which 3,723 vest on each of January 1, 2006 and 2007 and 3,724
shares vest on January 1, 2008. We also granted to Mr. Kanders on March 25, 2005
328,800 stock options to purchase our common stock from us at an exercise price
of $37.90 per share pursuant to our 2002 Stock Incentive Plan, which stock
options were immediately exercisable upon their grant thereof; sales of common
stock issued upon an exercise of any such options are subject to the following
lock-up restrictions: 50,000 shares will be restricted from sale until January
1, 2007, 100,000 shares will be restricted from sale until January 1, 2008,
128,800 will be restricted from sale until January 1, 2009, and 50,000 will be
restricted from sale until January 1, 2010; in addition, upon Mr. Kanders'
voluntary termination of employment with the Company, any of the foregoing
lock-up periods which have not yet expired shall be extended for an additional
five year period. See "Item 13 - Certain Relationships and Related Transactions"
below for a description of compensation paid to an entity controlled by Mr.
Kanders.

STEPHEN E. CROSKREY

As of March 7, 2005, we entered into a resignation and severance
agreement and general release with Stephen Croskrey (the "Severance Agreement")
pursuant to which Mr. Croskrey (i) resigned as the President and Chief Executive
Officer of our Products Division and from all other positions held by him at our
direct and indirect subsidiaries or affiliates; and (ii) released Armor Holdings
and its affiliates from any and all Claims (as defined in Mr. Croskrey's
Severance Agreement) and certain other matters through the date of the Severance
Agreement.

Pursuant to the terms of the Severance Agreement, provided that Mr.
Croskrey is not in breach of the terms of the Severance Agreement, we will make
severance payments in the aggregate amount of $337,500, which shall be payable
to Mr. Croskrey over a period of 18 months commencing six months after March 7,
2005 in equal amounts in accordance with our payroll practices in effect from
time to time for employees generally, and subject to withholding for applicable
taxes and other mutually agreed amounts. We will also make a lump sum payment of
$112,500 in September 2005 to an entity controlled by Mr. Croskrey for certain
services to be rendered to us.

In addition, certain options previously granted to Mr. Croskrey became
fully vested as of March 7, 2005, and the termination date of certain of such
options were extended. Certain options and restricted shares owned by Mr.
Croskrey will be delivered by Mr. Croskrey to Armor Holdings to be held by Armor
Holdings as collateral to secure Mr. Croskrey's obligations under the Severance
Agreement, and Mr. Croskrey granted Armor Holdings a security interest therein
in order to secure Mr. Croskrey's obligations under the Severance Agreement.

Mr. Croskrey's Severance Agreement also contains certain
confidentiality and non-competition provisions, medical and group term life
insurance benefits and other provisions that are customary for agreements of
this type.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

During fiscal 2004, none of the members of the Company's Compensation
Committee, (i) served as an officer or employee of the Company or its
subsidiaries, (ii) was formerly an officer of the Company or its subsidiaries or
(iii) entered into any transactions with the Company or its subsidiaries. During
fiscal 2004, none of our executive officers (i) served as a member of the
compensation committee (or other board committee performing similar functions
or, in the absence of any such committee, the board of directors) of another
entity, one of whose executive officers served on the Company's Compensation
Committee, (ii) served as director of another entity, one of whose executive
officers served on the Company's Compensation Committee, or (iii) served as
member of the compensation committee (or other board committee performing
similar functions or, in the absence of any such committee, the board of
directors) of another entity, one of whose executive officers served as a
director of the Company.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS

SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS

The table below shows the number of options and range of exercise
prices the Company granted to various employees and directors during our fiscal
year ended December 31, 2004 under our 1999 Stock Incentive Plan and Amended and
Restated 2002 Stock Incentive Plan (the "2002 Stock Incentive Plan").

PLAN NAME NUMBER OF GRANTS GRANT PRICE RANGES
------------------------------ -------------------- -----------------------

------------------------------ -------------------- -----------------------
1999 Stock Incentive Plan 28,000 $33.04 - $33.92
2002 Stock Incentive Plan 951,000 $28.46 - $41.85

The following table sets forth certain information regarding our equity
plans at December 31, 2004.

(C)
(A)
(B)
Number of
securities to be Number of securities remaining
issued upon Weighted-average available for future issuance
exercise of exercise price of under equity compensation plans
outstanding outstanding (excluding securities reflected in
options, warrants options, warrants column (A))
Plan Category and rights and rights
---------------------------------- -------------------- ------------------- ------------------------------------

Equity compensation plans
approved by security holders 2,898,516 $23.08 1,648,012

Equity compensation plans not
approved by security holders 260,000 $23.93 0
--------------------
Total 3,158,516
====================

The table below shows the number of options and range of exercise
prices we granted to various employees and directors during our quarter ended
March 31, 2005 under our 1999 Stock Incentive Plan and 2002 Stock Incentive
Plan.

PLAN NAME NUMBER OF GRANTS GRANT PRICE RANGES
------------------------------ -------------------- -----------------------

------------------------------ -------------------- -----------------------
1999 Stock Incentive Plan 130,000 $37.90 - $44.76
2002 Stock Incentive Plan 1,300,000 $37.90 - $45.93

The following table sets forth certain information regarding our equity
plans at March 31, 2005.

(A) (B) (C)
Number of
securities to be
issued upon Weighted-average Number of securities remaining
exercise of exercise price of available for future issuance
outstanding outstanding under equity compensation plans
options, warrants options, warrants (excluding securities reflected in
Plan Category and rights and rights column (A))
---------------------------------- -------------------- ------------------- ------------------------------------

Equity compensation plans
approved by security holders 4,220,026 $29.76 156,345

Equity compensation plans not
approved by security holders 160,000 $23.93 0
--------------------
Total 4,380,026
====================

Certain of the unvested stock options previously granted to employees
were accelerated on March 25, 2005, are presently exercisable and are subject to
lock-up restrictions of varying durations. In addition, on March 25, 2005, the
Company accelerated the issuance of certain stock options that the Company would
have awarded in the future to Mr. Kanders, Mr. Schiller, Mr. Heiar, Mr. Mecredy,
Mr. Scott O'Brien and Mr. Gary Allen. The newly awarded stock options were
vested upon issuance, are presently exercisable and are subject to lock-up
restrictions of varying durations which coincide with the original vesting
schedules. For more information regarding the recently accelerated stock
options, please see the section labeled "Executive Compensation".

We have two non-qualified equity plans, the 2002 Executive Stock Plan
and the 1998 Stock Option Plan, that have not been approved by stockholders. The
2002 Executive Stock Plan provides for the grant of a total of 470,000 stock
options and stock awards to our key employees. The Board of Directors, or a
committee designated by the Board consisting of two or more independent
directors, is authorized to set the price and terms and conditions of the
options and awards granted under the 2002 Executive Stock Plan. Options under
the 2002 Executive Stock Plan are substantially the same as the 2002 Stock
Incentive Plan except that we may only grant non-qualified stock options under
the 2002 Executive Stock Plan. The 2002 Executive Stock Plan was adopted on
March 13, 2002 and all shares available for grant under the 2002 Executive Stock
Plan were granted to our executive officers on March 13, 2002.

The 1998 Stock Option Plan provides for the grant of a total of 725,000
stock options to our key employees. The Board of Directors, or a committee
designated by the Board consisting of two or more independent directors, is
authorized to set the price and terms and conditions of the options granted
under the 1998 Stock Option Plan. Options under the 1998 Stock Option Plan are
substantially the same as the Amended and Restated 1996 Stock Option Plan except
that we may only grant non-qualified stock options under the 1998 Stock Option
Plan. The 1998 Stock Option Plan was adopted on December 7, 1998 and all shares
available for grant under the 1998 Stock Option Plan were granted to our
executive officers effective January 1, 1999 or, if later, the renewal date of
their respective employment agreements.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth as of April 27, 2005 the number of
shares and percentage of our common stock owned by (i) each person known to the
Company to beneficially own five percent or more of the Company's common stock,
(ii) each of the Company's directors, (iii) each of our Named Executive
Officers, and (iv) our executive officers and directors as a group. Unless
otherwise indicated, each of the stockholders shown in the table below has sole
voting and investment power with respect to the shares beneficially owned.
Unless otherwise indicated, the address of each person named in the table below
is c/o Armor Holdings, Inc., 13386 International Parkway, Jacksonville, Florida
32218.

Amount and
nature of
beneficial
Name ownership (1) Percentage (16)
---- ------------- ---------------

Warren B. Kanders and Kanders Florida Holdings, Inc. (2) 3,879,113 10.7%

T. Rowe Price Associates, Inc. (3) 2,813,300 8.1%

FleetBoston Financial Corporation (4) 2,065,005 6.0%

Friess Associates LLC (5) 1,768,900 5.1%

Robert R. Schiller (6) 916,705 2.6%

Stephen Croskrey (7) 249,423 *

Nicholas Sokolow (8) 188,291 *

Burtt R. Ehrlich (9) 113,880 *

Thomas W. Strauss (10) 128,591 *

David R. Haas (11) 9,375 *

Glenn J. Heiar (12) 270,692 *

Deborah A. Zoullas (13) 37,169 *

Robert F. Mecredy (14) 227,424 *

All directors and executive officers as a group (12 persons) (15) 6,356,840 16.8%

* Less than 1%.

(1) As used in this table, a beneficial owner of a security includes any person
who, directly or indirectly, through contract, arrangement, understanding,
relationship or otherwise has or shares (a) the power to vote, or direct the
voting of, such security or (b) investment power which includes the power to
dispose, or to direct the disposition of, such security. In addition, a person
is deemed to be the beneficial owner of a security if that person has the right
to acquire beneficial ownership of such security within 60 days of April 27,
2005.

(2) The amount of securities reported as beneficially owned includes: (i)
2,098,395 shares held by Kanders Florida Holdings, Inc., of which Mr. Kanders is
the sole stockholder and sole director and (ii) 117,100 shares of restricted
stock sales of which will be restricted until November 11, 2005; upon Mr.
Kanders' voluntary termination of employment with the Company, if the foregoing
lock-up period has not yet expired, it shall be extended for an additional five
year period; upon a change in control of the Company, any lock-up release period
that is still in effect in respect of such shares upon the occurrence of such
change in control shall terminate. The amount of securities reported as
beneficially owned also includes presently exercisable stock options to
purchase: (i) 328,800 shares at an exercise price of $37.90 per share; sales of
common stock issued upon an exercise of any such options will be subject to the
following lock-up restrictions: 50,000 shares will be restricted from sale until
January 1, 2007; 100,000 shares will be restricted from sale until January 1,
2008; 128,800 shares will be restricted from sale until January 1, 2009; and
50,000 shares will be restricted from sale until January 1, 2010; in addition,
upon Mr. Kanders' voluntary termination of employment with the Company, if the
foregoing lock-up periods have not yet expired, they shall each be extended for
an additional five year period; (ii) 110,000 shares at an exercise price of
$23.93 per share; (iii) 225,000 shares at an exercise price of $24.07 per share;
(iv) 250,000 shares at an exercise price of $24.07 per share; sales of common
stock issued upon an exercise of any such options will be restricted from sale
until December 31, 2006; in addition, upon Mr. Kanders' voluntary termination of
employment with the Company, if the foregoing lock-up period has not yet
expired, it shall be extended for an additional five year period; (v) 100,000
shares at an exercise price of $14.32 per share; (vi) 200,000 shares at an
exercise price of $14.32 per share; sales of common stock issued upon an
exercise of any such options are

subject to the following lock-up restrictions: 100,000 shares will be restricted
from sale until July 26, 2005, and 100,000 shares will be restricted from sale
until July 26, 2006; in addition, upon Mr. Kanders' voluntary termination of
employment with the Company, any of the foregoing lock-up periods which have not
yet expired shall be extended for an additional five year period; (vii) 8,125
shares at an exercise price of $14.44 per share; (viii) 83,333 shares at an
exercise price of $28.90 per share; (ix) 166,667 shares at an exercise price of
$28.90 per share; sales of common stock issued upon an exercise of any such
options are subject to the following lock-up restrictions: 83,333 shares will be
restricted from sale until January 1, 2006, and 83,334 shares will be restricted
from sale until January 1, 2007; in addition, upon Mr. Kanders' voluntary
termination of employment with the Company, any of the foregoing lock-up periods
which have not yet expired shall be extended for an additional five year period;
and (x) 150,000 shares at an exercise price of $45.93 per share; sales of common
stock issued upon an exercise of any such options are subject to the following
lock-up restrictions: 50,000 shares will be restricted from sale until January
3, 2006; 50,000 shares will be restricted from sale until January 3, 2007; and
50,000 shares will be restricted from sale until January 3, 2008; in addition,
upon Mr. Kanders' voluntary termination of employment with the Company, any of
the foregoing lock-up periods which have not yet expired shall be extended for
an additional five year period. The amount of securities reported as
beneficially owned excludes: (i) 9,228 shares of common stock awarded to the
reporting person by the issuer as a restricted stock award, of which 4,614
shares vest on each of February 9, 2006, and February 9, 2007; (ii) 11,170
shares of common stock awarded to the reporting person by the issuer as a
restricted stock award, of which 3,723 shares vest on each of January 1, 2006
and 2007, and 3,724 shares vest on January 1, 2008; and (iii) 4,760 shares held
for the benefit of Mr. Kanders' children.

(3) This information has been obtained from Schedule 13G/A filed by T. Rowe
Price Associates, Inc. on February 15, 2005. The address of T. Rowe Price
Associates, Inc. is 100 E. Pratt Street, Baltimore, MD 21202.

(4) This information has been obtained from the Schedule 13G filed by
FleetBoston Financial Corporation on February 13, 2004. The address of
FleetBoston Financial Corporation is 100 Federal Street, Boston, MA 02110.

(5) This information has been obtained from Schedule 13G filed by Friess
Associates LLC on February 14, 2005. The address of Friess Associates LLC is 115
E. Snow King, Jackson, WY 83001.

(6) The amount of securities reported as beneficially owned includes 95,325
shares of restricted stock sales of which will be restricted until November 11,
2005; upon Mr. Schiller's voluntary termination of employment with the Company,
if the foregoing lock-up period has not yet expired, it shall be extended for an
additional five year period; upon a change in control of the Company, any
lock-up release period that is still in effect in respect of such shares upon
the occurrence of such change in control shall terminate. The amount of
securities reported as beneficially owned also includes presently exercisable
stock options to purchase: (i) 219,200 shares at an exercise price of $37.90 per
share; sales of common stock issued upon an exercise of any such options will be
subject to the following lock-up restrictions: 33,333 shares will be restricted
from sale until January 1, 2007; 66,666 shares will be restricted from sale
until January 1, 2008; 85,867 shares will be restricted from sale until January
1, 2009; and 33,334 shares will be restricted from sale until January 1, 2010;
in addition, upon Mr. Schiller's voluntary termination of employment with the
Company, any of the foregoing lock-up periods which have not yet expired shall
be extended for an additional five year period; (ii) 50,000 shares at an
exercise price of $23.93 per share; (iii) 66,666 shares at an exercise price of
$17.12 per share; (iv) 133,334 shares at an exercise price of $17.12 per share;
sales of common stock issued upon an exercise of any such options are subject to
the following lock-up restrictions: 66,667 shares will be restricted from sale
until October 8, 2005, and 66,667 shares will be restricted from sale until
October 8, 2006; in addition, upon Mr. Schiller's voluntary termination of
employment with the Company, any of the foregoing lock-up periods which have not
yet expired shall be extended for an additional five year period; (v) 100,694
shares at an exercise price of $15.05 per share; (vi) 50,000 shares at an
exercise price of $15.05 per share; sales of common stock issued upon an
exercise of any such options will be restricted from sale until December 31,
2005; in addition, upon Mr. Schiller's voluntary termination of employment with
the Company, if the foregoing lock-up period has not yet expired, it shall be
extended for an additional five year period; and (vii) 100,000 shares at an
exercise price of $45.93 per share; sales of common stock issued upon an
exercise of any such options are subject to the following lock-up restrictions:
33,333 shares will be restricted from sale until January 3, 2006; 33,333 shares
will be restricted from sale until January 3, 2007; and 33,334 shares will be
restricted from sale until January 3, 2008; in addition, upon Mr. Schiller's
voluntary termination of employment with the Company, any of the foregoing
lock-up periods which have not yet expired shall be extended for an additional
five year period. The amount of securities reported as beneficially owned
excludes: (i) 11,170 shares of restricted stock 3,723 shares of which will vest
on each of

January 1, 2006 and 2007, and 3,724 shares of which will vest on
January 1, 2008; and (ii) 6,921 shares of restricted stock which vests on
February 9, 2007.

(7) Mr. Croskrey, our former President and CEO, Products Division,
terminated his employment with the Company effective March 7, 2005, and the
information contained in this table is as of that date. The amount of securities
reported as beneficially owned also includes presently exercisable stock options
to purchase 10,000 share at an exercise price of $44.76 per share. The amount of
securities reported as beneficially owned excludes: (i) 2,851 shares of
restricted stock which will vest on December 31, 2006 and (ii) 1,954 shares of
restricted stock which will vest on March 7, 2008.

(8) The amount of securities reported as beneficially owned also includes
presently exercisable stock options to purchase: (i) 9,000 shares at an exercise
price of $3.75 per share; (ii) 10,000 shares at an exercise price of $9.6875 per
share, (iii) 10,000 shares at an exercise price of $13.1875 per share, (iv)
12,500 shares at an exercise price of $14.44 per share, (v) 12,500 shares at an
exercise price of $24.07 per share, (vi) 15,000 shares at an exercise price of
$14.32 per share, and (vii) 9,375 shares at an exercise price of $35.40 per
share. Also includes 60,000 shares owned by S.T. Investors Fund, LLC, a limited
liability company of which Mr. Sokolow is a member, 10,000 shares owned by Mr.
Sokolow's profit sharing plan and 11,200 shares held for the benefit of Mr.
Sokolow's children and of which Mr. Sokolow disclaims beneficial ownership. The
amount of securities reported as beneficially owned excludes stock options to
purchase 3,125 shares at an exercise price of $35.40 which vests on June 30,
2005.

(9) The amount of securities reported as beneficially owned also includes
presently exercisable stock options to purchase: (i) 12,500 shares at an
exercise price of $24.07 per share and (ii) 9,375 shares at an exercise price of
$35.40 per share. Excludes: (i) 5,000 shares owned by Mr. Ehrlich's children;
(ii) 6,500 shares in trust for the benefit of his children, of which Mr.
Ehrlich's spouse is trustee; and (iii) 400 shares owned by Mr. Ehrlich's
spouse's individual retirement account of which Mr. Ehrlich disclaims beneficial
ownership. The amount of securities reported as beneficially owned also excludes
stock options to purchase 3,125 shares at an exercise price of $35.40 per share
which vest on June 30, 2005.

(10) The amount of securities reported as beneficially owned also includes
presently exercisable stock options to purchase: (i) 46,591 shares at an
exercise price of $7.50 per share (ii) 10,000 shares at an exercise price of
$9.6875 per share, (iii) 10,000 shares at an exercise price of $13.1875 per
share, (iv) 12,500 shares at an exercise price of $14.44 per share, (v) 12,500
shares at an exercise price of $24.07 per share, (vi) 12,000 shares at an
exercise price of $14.32 per share, and (vii) 9,375 shares at an exercise price
of $35.40 per share. The amount of securities reported as beneficially owned
excludes stock options to purchase 3,125 shares at an exercise price of $35.40
which vests on June 30, 2005.

(11) The amount of securities reported as beneficially owned includes
presently exercisable stock options to purchase 9,375 shares at an exercise
price of $35.40. The amount of securities reported as beneficially owned
excludes stock options to purchase 3,125 shares at an exercise price of $35.40
which vests on June 30, 2005.

(12) The amount of securities reported as beneficially owned also includes
presently exercisable stock options to purchase: (i) 75,000 shares at an
exercise price of $37.90 per share; sales of common stock issued upon an
exercise of any such options will be subject to the following lock-up
restrictions: 6,250 shares will be restricted from sale until January 1, 2008;
12,500 shares will be restricted from sale until January 1, 2009; 18,750 shares
will be restricted from sale until January 1, 2010; 18,750 shares will be
restricted from sale until January 1, 2011; 12,500 shares will be restricted
from sale until January 1, 2012; and 6,250 shares will be restricted from sale
until January 1, 2013; in addition, upon Mr. Heiar's voluntary termination of
employment with the Company, any of the foregoing lock-up periods which have not
yet expired shall be extended for an additional five year period; (ii) 20,000
shares at an exercise price of $28.46; (iii) 80,000 shares at an exercise price
of $28.46; sales of common stock issued upon an exercise of any such options are
subject to the following lock-up restrictions: 20,000 shares will be restricted
from sale until March 11, 2006; 20,000 shares will be restricted from sale until
March 11, 2007; 20,000 shares will be restricted from sale until March 11, 2008;
and 20,000 shares will be restricted from sale until March 11, 2009; in
addition, upon Mr. Heiar's voluntary termination of employment with the Company,
any of the foregoing lock-up periods which have not yet expired shall be
extended for an additional five year period; (iv) 54,391 shares at an exercise
price of $21.75; and (v) 25,000 shares at an exercise price of $44.76; sales of
common stock issued upon an exercise of any such options will be subject to the
following lock-up restrictions: all of the shares will be restricted from sale
for two years from February 10, 2005 (the "Vesting Date"), 75% of the shares
will be restricted from sale for three years from the Vesting Date, 50% of the
shares will be restricted from sale

for four years from the Vesting Date, and 25% of the shares will be restricted
from sale for five years from the Vesting Date. The amount of securities
reported as beneficially owned excludes: (i) 1,954 shares of restricted stock of
which 651 will vest on each of January 1, 2006 and 2007, and 652 shares of which
will vest on January 1, 2008; (ii) 25,000 shares of restricted stock which will
vest upon a change of control of the Company; (iii) 2,000 shares of restricted
stock which vests on December 31, 2005; and (iv) 1,520 shares of restricted
stock which vests on December 31, 2006.

(13) The amount of securities reported as beneficially owned also includes
presently exercisable stock options to purchase: (i) 15,794 shares at an
exercise price of $13.98; (ii) 12,000 shares at an exercise price of $14.32 per
share, and (iii) 9,375 shares at an exercise price of $35.40 per share. The
amount of securities reported as beneficially owned excludes stock options to
purchase 3,125 shares at an exercise price of $35.40 per share which vest on
June 30, 2005.

(14) Includes stock options to purchase: (i) 8,333 shares at an exercise
price of $23.09 which are presently exercisable; (ii) 66,667 shares at an
exercise price of $17.12 which are presently exercisable; sales of common stock
issued upon an exercise of any such options are subject to the following lock-up
restrictions: 33,333 shares will be restricted from sale until October 8, 2005,
and 33,334 shares will be restricted from sale until October 8, 2006; in
addition, upon Mr. Mecredy's voluntary termination of employment with the
Company, any of the foregoing lock-up periods which have not yet expired shall
be extended for an additional five year period; (iii) 75,000 shares at an
exercise price of $44.76 which are presently exercisable; sales of common stock
issued upon an exercise of any such options will be subject to the following
lock-up restrictions: all of the shares will be restricted from sale for two
years from February 10, 2005 (the "Vesting Date"), 75% of the shares will be
restricted from sale for three years from the Vesting Date, 50% of the shares
will be restricted from sale for four years from the Vesting Date, and 25% of
the shares will be restricted from sale for five years from the Vesting Date;
and (iv) 75,000 shares at an exercise price of $37.90 which are presently
exercisable; sales of common stock issued upon an exercise of any such options
will be subject to the following lock-up restrictions: 6,250 shares will be
restricted from sale until January 1, 2008; 12,500 shares will be restricted
from sale until January 1, 2009; 18,750 shares will be restricted from sale
until January 1, 2010; 18,750 shares will be restricted from sale until January
1, 2011; 12,500 shares will be restricted from sale until January 1, 2012; and
6,250 shares will be restricted from sale until January 1, 2013; in addition,
upon the Mr. Mecredy's voluntary termination of employment with the Company, or
termination for cause, any of the foregoing lock-up periods which have not yet
expired shall be extended for an additional five year period. Excluded are the
following unvested grants of restricted stock: (i) 3,351 shares of which 1,117
shares will vest on each of January 1, 2006, January 1, 2007, and January 1,
2008; (ii) 25,000 shares which will vest upon a change of control of the
Company; (iii) 2,400 shares which will vest on December 31, 2005; and (iv) 1,900
shares which will vest on December 31, 2006.

(15) See footnotes (2) and (6) through (14).

(16) Percent is based on 34,535,765 shares of common stock outstanding as of
April 27, 2005.

The Company is not aware of any material proceedings to which any of
the Company's directors, executive officers, affiliates of the foregoing persons
or any security holder, including any owner of record or beneficial owner of
more than 5% of any class of the Company's voting securities, is a party adverse
to the Company or has a material interest adverse to the Company.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Effective as of January 1, 2003, we entered into a Transportation
Services Agreement with Kanders Aviation, LLC, an entity controlled by Mr.
Kanders. Pursuant to the terms of the Transportation Services Agreement and upon
our request, Kanders Aviation may, in its sole discretion, provide us with air
transportation services via certain aircraft. We intend to use the air
transportation services provided by Kanders Aviation, LLC only to the extent we
require air transportation services when our leased airplane is otherwise being
utilized by us. The Transportation Services Agreement will remain in effect
indefinitely until terminated by written notice by either party thereto to the
other party thereto. During the term of the Transportation Services Agreement,
we will reimburse Kanders Aviation in an amount equal to the fair market value
of the air transportation services provided by Kanders Aviation to us and any
additional expenses incurred by Kanders Aviation in connection with such air
transportation services.

We also agreed to reimburse Kanders & Co., a corporation controlled by
our Chairman of the Board and Chief Executive Officer, for the full cost of
maintaining his principal office in Stamford, Connecticut or such other location
as Mr. Kanders may determine, including, without limitation, costs for rent,
utilities, secretarial services, information services, transportation services
and similar office-related expenses ("Office Reimbursement Expenses") consistent
with prior reimbursements to Kanders & Co. During fiscal 2004, we reimbursed
Kanders & Co. for Office Reimbursement Expenses in the aggregate amount of
$369,000.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

Aggregate fees for professional services rendered for Armor Holdings by
PricewaterhouseCoopers LLP for the fiscal years ended December 31, 2004 and 2003
were:

2004 2003
---- ----
Audit Fees $1,949,801 $2,011,781
Audit Related Fees 492,296 268,697
Tax Fees 343,090 690,014
All Other Fees 10,000 --
----------- -----------
Total $2,795,187 $2,970,492
=========== ===========

AUDIT FEES

The Audit Fees for the fiscal years ended December 31, 2004 and 2003,
respectively, were for professional services rendered for the audit of our
consolidated financial statements for the fiscal years ended December 31, 2004
and 2003, as applicable, and for the review of our consolidated financial
statements included in our quarterly reports on Form 10-Q for fiscal 2004 and
2003, as applicable. In addition, Audit Fees for both fiscal years 2004 and 2003
also includes fees for services rendered to us by PricewaterhouseCoopers LLP for
statutory and subsidiary audits, issuance of comfort letters, consents and
assistance with review of documents filed with the Commission aggregating
$652,016 and $762,300 in fiscal years 2004 and 2003, respectively. Additionally,
Audit Fees for 2003 include $319,542 for income tax provision procedures.

AUDIT RELATED FEES

The Audit Related Fees as of the fiscal years ended December 31, 2004
and 2003, respectively, were for assurance and related services related to
employee benefit plan audits and due diligence related to mergers and
acquisitions.

TAX FEES

Tax Fees as of the fiscal years ended December 31, 2004 and 2003,
respectively, were for services related to tax compliance, including the
preparation of tax returns and claims for refund, tax planning and advice,
including assistance with and representation in tax audits and appeals, advice
related to mergers and acquisitions, tax services for employee benefit plans,
and requests for rulings or technical advice from tax authorities.

ALL OTHER FEES

All Other Fees for the fiscal year ended December 31, 2004 were for
equity compensation plan consultations and our subscription to an Internet-based
accounting research tool. There were no fees incurred for All Other Fees for the
fiscal year ended December 31, 2003. Auditor Independence

The Audit Committee has considered the non-audit services provided by
PricewaterhouseCoopers LLP and determined that the provision of such services
had no effect on PricewaterhouseCoopers LLP's independence from Armor Holdings.

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENTS AND SCHEDULES

(a) None.

(b) Exhibits

The following Exhibits are hereby filed as part of this Annual Report
on Form 10-K/A:

EXHIBIT NO. DESCRIPTION

31.1 Certification of Principal Executive Officer, as required by Rule
13a-14(a) of the Securities Exchange Act of 1934.

31.2 Certification of Principal Financial Officer, as required by Rule
13a-14(a) of the Securities Exchange Act of 1934.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

ARMOR HOLDINGS, INC.

/s/ Warren B. Kanders
---------------------------
Warren B. Kanders
Chairman of the Board of
Directors and Chief
Executive Officer
Dated: May 2, 2005

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the dates indicated:

/s/ Warren B. Kanders
-----------------------------------
Warren B. Kanders
Chairman of the Board of Directors
and Chief Executive Officer
Dated: May 2, 2005

/s/ Glenn J. Heiar /s/ Nicholas Sokolow
----------------------------------- ---------------------------
Glenn J. Heiar Nicholas Sokolow
Chief Financial Officer Director
(Principal Financial Officer and Dated: May 2, 2005
Principal Accounting Officer)
Dated: May 2, 2005

/s/ Burtt R. Ehrlich /s/ Thomas W. Strauss
----------------------------------- ---------------------------
Burtt R. Ehrlich Thomas W. Strauss
Director Director
Dated: May 2, 2005 Dated: May 2, 2005

/s/ David R. Haas /s/ Deborah A. Zoullas
----------------------------------- ---------------------------
David R. Haas Deborah A. Zoullas
Director Director
Dated: May 2, 2005 Dated: May 2, 2005