Exhibit 10.5

 

 

NON-DISCLOSURE AGREEMENT

 

The undersigned (the “Director”), being a director and co-portfolio manager of
Harbert Discovery Fund GP, LLC, the General Partner of Harbert Discovery Fund LP
(collectively with Harbert Fund Advisors, Inc. and Harbert Management
Corporation (“Harbert”) and a member of the Board of Directors of Perceptron,
Inc., a Michigan corporation (the “Company”), may be provided certain
information and data in connection with serving as a director of the Company
which the Company wishes to keep confidential, including, but not limited to,
information (whether furnished in writing or electronic format or orally)
regarding the Company’s governance, board of directors, management, plans,
strategies, business, finances or operations, including information relating to
financial statements, evaluations, plans, programs, customers, plants, equipment
and other assets, products, processes, manufacturing, marketing, research and
development, know-how and technology, intellectual property and trade secrets
and information which the Company has obtained from third parties and with
respect to which the Company is obligated to maintain confidentiality
(collectively, “Confidential Information”). Except as provided in this
Agreement, the Director will not (i) disclose any Confidential Information in
any manner whatsoever, (ii) use any Confidential Information other than in
connection with serving as a director of the Company or (iii), in the case of
Jack Bryant, notwithstanding clause (ii) of this paragraph, use any Confidential
Information other than in connection with decisions by Harbert to purchase or
sell common stock of the Company in compliance with the terms of this Agreement,
without securing the prior written consent of the Company.

 

Nothing contained in this Agreement shall prevent the Director from privately
disclosing Confidential Information to (i) officers, directors, accountants and
counsel for the Company, (ii) the Director’s legal counsel (“Director
Representative”) who need to know such information for the sole purpose of
advising the Director on his actions as a director of the Company or (iii)
officers, directors, accountants and legal counsel of Harbert (“Harbert
Representatives”); provided however, that the Director shall not disclose
Confidential Information to the extent such disclosure would be reasonably
likely to constitute waiver of the attorney-client privilege between the Company
and its counsel or the Company’s attorney work product privilege. Any Director
Representative shall only be provided Confidential Information by the Director
to the extent that they are informed of the confidential nature of the
Confidential Information and agree or are otherwise obligated to keep such
information confidential and to restrict the use of such confidential
information in accordance with the terms of this Agreement. Prior to the
disclosure of Confidential Information from the Director, the Director
Representatives or Harbert Representatives who will receive Confidential
Information shall agree in writing to keep the Confidential Information
confidential, to restrict the use of Confidential Information in accordance with
the terms of this Agreement, to be bound by this Agreement on the same terms as
the Director and to permit the Company to enforce such agreement, and a copy of
such writing executed by the Director Representatives or Harbert Representatives
who will receive Confidential Information shall be delivered to the Company.

 

The term “Confidential Information” shall not include information which (a) is
at the time of disclosure or thereafter becomes generally available to the
public other than as a result of a disclosure by the Director, a Director
Representative, Harbert or Harbert Representatives in violation of this
Agreement; (b) was, prior to disclosure by the Company, already in the
possession of the Director, a Director Representative, Harbert or Harbert
Representatives, provided that the source of such information was, to such
person’s knowledge after reasonable inquiry, not bound by a confidentiality
agreement with or other contractual, legal or fiduciary obligation of
confidentiality to the Company; (c) becomes available to the Director, a
Director Representative, Harbert or Harbert Representatives on a
non-confidential basis from a source (other than the Company, a Company
affiliate or a Company agent, representative, attorney, advisor, director,
officer or employee (collectively, the “Company Representatives”)) that is, to
such person’s knowledge after reasonable inquiry, not bound by a confidentiality
agreement with or other contractual, legal or fiduciary obligation of
confidentiality to the Company, and is not, to such person’s knowledge after
reasonable inquiry, under an obligation to the Company not to transmit the
information to such person; or (d) was independently developed by the Director,
a Director Representative, Harbert or Harbert Representatives without reference
to or use of the Confidential Information.

 

 

The Director is aware, and will advise any Director Representative, Harbert or
Harbert Representatives who is informed of the matters that are the subject of
this Agreement, that the Confidential Information may constitute material,
non-public information and of the restrictions imposed by the United States
securities laws on the purchase or sale of securities by any person who has
received material, non-public information from a publicly traded company and on
the communication of such information to any other person who may purchase or
sell such securities in reliance upon such information. The Director, any
Director Representative, Harbert or Harbert Representatives to whom the Director
transmits Confidential Information under this Agreement will comply with all
applicable federal and state securities laws in connection with the purchase or
sale, directly or indirectly, of securities of the Company or any other entity
of which the Director is provided material non-public information in his
capacity as a director of the Company for as long as the Director, any Director
Representative, Harbert or Harbert Representatives are in possession of material
non-public information about the Company or such other entity. The Director and
the Company acknowledge that none of the provisions hereto shall in any way
limit the Director’s or Harbert or Harbert Representative’s activities in the
ordinary course of their businesses if such activities will not violate
applicable securities laws or the obligations specifically agreed to under this
Agreement.

 

The Director, any Director Representative, Harbert or any Harbert Representative
to whom the Director transmits Confidential Information under this Agreement
acknowledges that none of the Company, any Company affiliate or any Company
Representative makes any representation or warranty, express or implied, as to
the accuracy or completeness of the Confidential Information. None of the
Company, any Company affiliate or any Company Representative shall have any
liability to the Director, any Director Representative, Harbert or Harbert
Representative hereunder relating to or resulting from the use of the
Confidential Information by the Director, any Director Representative, Harbert
or Harbert Representative or any errors in or omissions from the Confidential
Information.

 

In the event that the Director, any Director Representative, Harbert or Harbert
Representative is requested in any proceeding or governmental inquiry to
disclose any Confidential Information, the Director will give the Company prompt
written notice, to the extent not legally prohibited, of such request so that
the Company may seek an appropriate protective order or waive compliance with
the applicable provisions of this Agreement. If the Company seeks a protective
order, the Director and Harbert agree, and shall cause Harbert, to provide such
cooperation as the Company shall reasonably request and in no event will they
oppose action by the Company to obtain a protective order or other relief to
prevent the disclosure of Confidential Information or to obtain reliable
assurance that confidential treatment will be afforded to the Confidential
Information. If in the absence of a protective order, the Director, any Director
Representative, Harbert or Harbert Representatives, based upon the advice of
counsel, is legally required to disclose Confidential Information, or if the
Company waives compliance with this Agreement, such person or entity may
disclose without liability under this Agreement such portion of the Confidential
Information which counsel advises that the Director, any Director
Representative, Harbert or Harbert Representatives is legally required to
disclose if the recipient of such Confidential Information is informed of this
Agreement and the confidential nature of such Confidential Information. For the
avoidance of doubt, there shall be no legal requirement applicable to the
Director, Harbert or Harbert Representatives to disclose any Confidential
Information solely by virtue of the fact that, absent such disclosure, such
parties would be prohibited from purchasing, selling, or engaging in derivative
or other voluntary transactions with respect to the Company’s securities.

 

 

The Director and Harbert agree that in the event of a breach of this Agreement,
monetary damages alone may be inadequate, and the Company shall be entitled to
seek injunctive or other equitable relief to prevent breaches of this Agreement
in addition to any and all other remedies that may be available to the Company.

 

This Agreement may not be amended except in writing signed by all the parties
hereto. No failure or delay by either party in exercising any right hereunder or
any partial exercise thereof shall operate as a waiver thereof or preclude any
other or further exercise of any right hereunder.

 

The provisions of this Agreement relating to confidentiality shall terminate one
(1) year after the Director ceases to be a director of the Company, except that
any Confidential Information constituting trade secrets of the Company (as
defined in 18 U.S.C. § 1839(3)) shall be kept confidential in accordance with
the obligations of this Agreement for such longer time as such information
constitutes a trade secret of the Company. The invalidity or unenforceability of
any provision of this Agreement shall not affect the validity or enforceability
of any other provision.

 

This Agreement shall be governed by the laws of the state of Michigan, without
giving effect to any conflicts of laws principles thereof, and shall be binding
on each party’s successors and assigns.

 

All Confidential Information shall remain the property of the Company and none
of the Director, Harbert, or any Harbert Representative shall by virtue of any
disclosure of or use of any Confidential Information acquire any rights with
respect thereto, all of which rights (including all intellectual property
rights) shall remain exclusively with the Company. At any time after the date on
which the Director is no longer a director of the Company, upon the request of
the Company for any reason, the Director promptly return to the Company or
destroy all hard copies of the Confidential Information and use reasonable best
efforts to permanently erase or delete all electronic copies of the Confidential
Information in the possession or control of the Director, Harbert or Harbert
Representatives. Notwithstanding anything to the contrary contained in this
paragraph, the Director, Harbert Representatives and Harbert shall be permitted
to retain such Confidential Information as is necessary to enable them to comply
with any applicable document retention requirements under applicable law or
regulation or its internal compliance procedures, and to retain any computer
records and computer files containing any Confidential Information if required
pursuant to their respective current automatic archiving and backup procedures;
provided, however, that such retention shall be solely for legal, regulatory or
archival purposes, as the case may be, and the provisions of this Agreement
shall continue as to such information as long as it is retained by such person
irrespective of the termination provisions set forth above.

 

 

The Director agrees to be bound by the terms and conditions of the Standstill
Agreement, dated August 9, 2016, by and between the Company, Harbert Discovery
Fund LP, Harbert Discovery Fund GP, LLC, Harbert Fund Advisors, Inc. and Harbert
Management Corporation, by executing and delivering to the Company a Joinder
Agreement in the form attached to this Agreement as Exhibit A.

 

Acceptance of the above terms shall be indicated by having this letter
countersigned by the Director and Harbert.

 

  Sincerely,             PERCEPTRON, INC.                     By:  /s/ W.
Richard Marz     Name: W. Richard Marz     Title: Chairman of the Board,
President and Chief Executive Officer           Received and consented to this
9th day of August, 2016            /s/ John F. Bryant     John F. Bryant        
            ACKNOWLEDGED AND AGREED:           HARBERT DISCOVERY FUND LP     By:
Harbert Discovery Fund GP, LLC             By:  /s/ Kevin A. McGovern     Name:
 Kevin A. McGovern     Title:  Vice President and Associate General Counsel    
      HARBERT DISCOVERY FUND GP, LLC             By:  /s/ Kevin A. McGovern    
Name:  Kevin A. McGovern     Title:  Vice President and Associate General
Counsel        

 

 

  HARBERT FUND ADVISORS, INC.              By:  /s/ John W. McCollough     Name:
 John W. McCollough     Title:  Executive Vice President and General Counsel    
              HARBERT MANAGEMENT CORPORATION            By:  /s/ John W.
McCollough     Name:  John W. McCollough     Title:  Executive Vice President
and General Counsel

 

 

 

 

 

 

 

 

 

 

 

JOINDER AGREEMENT

 

This Joinder Agreement (the “Agreement”), dated as of August 9, 2016, is
delivered pursuant to the Non-Disclosure Agreement (the “Confidentiality
Agreement”), dated August 9, 2016, by and between Perceptron, Inc. (the
“Company”), Harbert Discovery Fund LP, Harbert Discovery Fund GP, LLC, Harbert
Fund Advisors Inc., Harbert Management Corporation and the undersigned.
Capitalized terms not otherwise defined herein have the meaning set forth in the
Standstill Agreement (the “Standstill Agreement”), dated August 9, 2016, by and
between the Company, Harbert Discovery Fund LP, Harbert Discovery Fund GP, LLC,
Harbert Fund Advisors, Inc., and Harbert Management Corporation, a copy of which
is attached to this Agreement as Exhibit A.

 

The undersigned wishes to be elected as a Director. As a condition precedent to
being elected as Director, the undersigned is required to become a party to the
Standstill Agreement.

 

By executing and delivering this Agreement, the undersigned hereby becomes a
party to the Standstill Agreement and shall be fully bound by, and subject to,
all of the covenants, terms and conditions of the Standstill Agreement as though
an original party to such agreement and shall be deemed a Holders Director for
all purposes of such agreement.

 

 

 

 

        John F. Bryant