Exhibit 10.12


 





 


BUSINESS AGREEMENT





Strategic Partnership between Microphase
Corporation and Dynamac, Inc.


 


This Business Agreement (“Agreement”)
is entered between Microphase Corporation (hereinafter “Microphase”) a Connecticut Corporation with offices at 587 Connecticut
Avenue, Norwalk, Connecticut 06854 and Dynamac, Inc. (hereinafter “Dynamac”) an Illinois Corporation with offices at
1229 Capitol Drive, Addison, IL 60101. Microphase and Dynamac are also hereinafter referred to individually as “the Party”
and together as “the Parties”.


 


		1.	Business Opportunity:
                                         Microphase and Dynamac believe that there are significant potential opportunities in
                                         the RF/Microwave Test and Measurement industry for low-cost high frequency calibrated
                                         test probe products and related test platforms and accessories. Microphase and Dynamac
                                         have agreed to form a strategic partnership that will let both companies use their core
                                         competencies, technologies, and resources to develop, manufacture, and market a unique
                                         portfolio of industry’s first low cost RF/Microwave and Millimeter-wave calibrated test
                                         probes and related universal test platforms as alternative commercial products to conventional
                                         expensive custom test solutions.



 


(a) Dynamac


 


Dynamac has a unique portfolio of
proprietary high frequency calibrated test probes which has been successfully developed for testing a wide range of RF and Microwave
passive and active components, devices, and circuits covering a frequency range from DC to 14 GHz. Dynamac is also currently developing
test probe technology that will extend frequency range of its calibrated probes to 80 GHz covering Millimeter-wave market. Dynamac’s
calibrated test probe technology and related accessories are protected by registered patents, patent applications in preparation,
and trade secrets. Dynamac’s calibrated test probes and related accessories are intended for day to day use by thousands of RF
and Microwave electronics and wireless design engineers worldwide across a multitude of diverse market sectors with a combined
TAM exceeding $900 million. Dynamac proprietary calibrated test probes have not been released to market. Dynamac has been contemplating
creation of a separate and independent business unit dedicated to test probe business. However, after initial discussions with
Microphase Dynamac has indicated its desire to partner with Microphase for marketing and business development of its RF/Microwave
calibrated test probe product line and related accessories. It is anticipated that an alliance with Microphase will be more efficient
and most cost effective “go-to-marker strategy for Dynamac based upon which Microphase, through its established brand and
long history in the RF/Microwave industry, can dominate the market and position both companies for substantial financial success.


 


Microphase Corporation
587 Connecticut Ave, Norwalk CT 06854 (203) 866-8000 www.microphase.com 


 




    	 



    	 



    

 


(b) Microphase


 


Microphase is interested in expanding
its market focus through broadening its product offering and diversifying its customer base to support its strategic plan and
revenue growth objectives. Microphase has marketing, business development and engineering expertise and resources to support this
new initiative for Dynamac’s calibrated test probe products and related accessories provided that Microphase is guaranteed to
be the sole supplier of calibrated test probe solutions and all related test platforms and accessories worldwide. Microphase agrees
to only use parts manufactured and supplied by Dynamac for final product assembly and test by Microphase, except for certain cable
assemblies and laser engraved wood cases which Microphase will have the right to procure from independent sources.


 


		2.	Product Roadmap:
                                         Microphase and Dynamac
                                         agree to work together to develop a joint product roadmap based on currently finished
                                         products by Dynamac and those products that are currently in development, collectively
                                         the test and measurement product line (“the Product Line”) to address test
                                         and measurement market opportunities extending into Millimeter-wave range. All costs
                                         associated with development and completion of any new products will be covered by the
                                         Parties according to the responsibilities identified and assigned tasks between the Parties.



 


		3.	Private Labeling:
                                         Dynamac agrees to private
                                         label its proprietary RF/Microwave calibrated test probes, test platforms, and related
                                         accessories for Microphase. Microphase shall have the right to market private labeled
                                         calibrated test probes, test platforms, and related accessories under Microphase brand
                                         to North American and European customers as well as to end users in other parts of the
                                         world. If private labeled products are offered in China, South Korea, and Taiwan Dynamac
                                         agrees to file for patent protection in these countries. Microphase agrees to share the
                                         cost for filings. Dynamac agrees to private label its proprietary RF/Microwave test probes,
                                         test platforms, and related accessories listed in Appendix (A) for Microphase.



 


		4.	Manufacturing:
                                         Dynamac will be responsible
                                         for manufacturing all machined piece parts as well as anodizing, laser engraving, and
                                         gold plating for all products listed in the definitive agreement at its facilities in
                                         Addison, IL at an agreed standard cost. Products may be ordered by Microphase from Dynamac
                                         in agreed lot sizes and delivered to the Microphase facility in Connecticut. Dynamac
                                         will invoice Microphase for supply of finished private labeled piece parts and will grant
                                         Microphase a 60 day payment term.



 


		5.	Product Assembly
                                         and Test: Microphase
                                         will be responsible for final product assembly, test, and QC. Microphase may have to
                                         generate its own internal engineering and manufacturing drawings according to its own
                                         internal manufacturing standards and policies. Dynamac agrees to assist Microphase with
                                         preparation of documentation should need arise. All probe products will be assembled
                                         and tested by Microphase at Microphase facilities. Certain universal test platforms may
                                         be partially assembled by Dynamac with final assembly and test performed by Microphase.
                                         In principal, each party will pay its own engineering support costs.



 




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		6.	Marketing:
                                         In all cases, Microphase
                                         shall be the primary marketing source for all test and measurement products listed in
                                         the definitive agreement and any other related products currently in development. Microphase
                                         and Dynamac agree to a branding strategy for all test and measurement products included
                                         in this Agreement to promote sales and maximize profitability. Microphase guarantees
                                         to advance and market the test and measurement product line as a high priority business
                                         initiative. A marketing strategy will be developed by Microphase and will be discussed
                                         with Dynamac.



 


		7.	Pricing strategy:
                                         The unit price for each
                                         product will be established based on market demand for the test probes and platforms
                                         and related accessories. However, based on extensive research by Dynamac and its previous
                                         teams involved in the development of the product line and discussions with Agilent Technologies
                                         and major RF/Microwave distributors including Arrow and RFMW manufacturer’s suggested
                                         retail price for each unit has been developed and is shown in Appendix (B) (Pricing Schedule).
                                         Unit prices may be adjusted from time to time if deemed necessary due to market conditions
                                         and customer demand.



 


		8.	Patents:
                                         Dynamac will apply, at its
                                         sole cost, for product patent protection for inventions in connection with Dynamac’s
                                         proprietary RF/Microwave calibrated test probes, test platforms and related accessories
                                         and provide Microphase with royalty free license to sell Dynamac’s calibrated RF/Microwave
                                         test probes, test platforms and related accessories.



 


		9.	Royalties:
                                         Microphase agrees to pay
                                         Dynamac a 25% royalty based on the list price of each private labeled product sold by
                                         Microphase. All royalty payments will paid by Microphase on a quarterly basis and will
                                         be made out to 24KG Capital, LLC. 24KG Capital, LLC is the investment arm of Dynamac,
                                         Inc.



 


		10.	Licensing and
                                         Rights Fee: Microphase
                                         agrees to pay Dynamac a one-time fee of US$350,000. The fee will be paid to Dynamac according
                                         to the following schedule:



 


	$	25,000	 	 	September 3, 2014
	$	25,000	 	 	September 18, 2014
	$	150,000	 	 	October 18, 2014
	$	150,000	 	 	November 18, 2014
	$	350,000	 	 	 



 


In exchange for licensing and rights fee Dynamac agrees to:


 


		(i)	Grant total exclusivity to Microphase to advertise,
                                         market, and sell the Product Line listed in Appendix (A) under Microphase brand.



 




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		(ii)	Authorize Microphase to issue “new product”
                                         announcements and press releases.



 


		(iii)	Provide Microphase with one complete sample of each
                                         finished product (set).



 


		(iv)	Authorize Microphase to pursue and lead future product
                                         development and apply for Government R&D funding for development of Millimeter-wave
                                         calibrated test probes and test platforms, etc. provided that Dynamac receives 40% of
                                         all funding paid to Microphase by Government agency(ies). Dynamac agrees to manufacture
                                         all necessary parts for the development of Millimeter-wave test probes and test platforms.



 


		(v)	Grant Microphase “First Right of Refusal”
                                         in the event Dynamac decides to divest

                                         the Product Line.



 


		11.	First Right of Refusal:
                                         In the event Dynamac proposes to sell the Product Line Microphase shall have
                                         the right to purchase the Product Line listed herein. The sale price is set at $2,500,000.
                                         Dynamac agrees to deduct the $350,000 Licensing and Rights Fee from the sale price of
                                         $2,500,000 if and when Microphase decides to purchase the Product Line. The First Right
                                         of Refusal shall be limited to a 3 year term from the date of this Agreement between
                                         the Parties.



 


		12.	Solution Partnership
                                         with Agilent Technologies: Microphase shall have the right to become a
                                         Solution Partner with Keysight Technologies (formerly Agilent Technologies).



 


		13.	Partnership with
                                         Copper Mountain Technologies: Microphase shall have the right to enter partnership
                                         with Copper Mountain Technologies to offer total RF/Microwave test and measurement solutions
                                         to the end user market.



 


		14.	Confidentiality:
                                         The parties agree to use best efforts to maintain at all times as confidential
                                         information the fact that you or we have executed this Agreement, the terms of this Agreement,
                                         the existence and content of any negotiations between us except that the Parties may
                                         inform advisors, counsel, and employees with a need to know as each party deems necessary.
                                         Additionally, the Parties shall be bound by the terms and conditions of the Mutual Nondisclosure
                                         Agreement dated as of May 15, 2014 as previously executed by the Parties.



 


		I5.	General
                                         Terms: This Agreement shall be binding upon and inure to the benefit of
                                         the Parties and their successors and assigns. The waiver or failure of either Party to
                                         exercise in any respect any right provided for in this Agreement shall not be deemed
                                         a waiver of any further right under this Agreement. If any provision of this Agreement
                                         is held by a court of competent jurisdiction to be contrary to law or otherwise unenforceable,
                                         it shall be enforced to the extent legally permissible and as necessary to reflect the
                                         intent of the Parties and shall not affect the remaining provisions of this Agreement,
                                         which shall remain in full force and effect. This Agreement is binding upon each Party
                                         and their respective affiliates. This Agreement shall be deemed to be a contract made
                                         under the laws of the State of Connecticut and shall be governed by the laws thereof
                                         without reference to its principles of conflicts of law. This Agreement represents the
                                         entire agreement between the Parties with respect to the subject matter herein.



 




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IN WITNESS WHEREOF, the Parties
have duly executed this document as of the date first written below:


 





	Microphase Corporation	 
	 	 	 
	Executed By:	/s/ Ronald Durando	 
	 	 	 
	Name:	Ronald Durando	 
	 	 	 
	Title:	Chief Operating Officer	 
	 	 	 
	Date:	August 08, 2014	 
	 	 	 
	Dynamac, Inc.	 
	 	 	 
	Executed By:	/s/ Kent Higgins	 
	 	 	 
	Name:	Kent Higgins	 
	 	 	 
	Title:	President	 
	 	 	 
	Date:	August 08, 2014	 







 




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Appendix A


List of Private Labeled Products by Dynamac
for Microphase


(Product Line)


 


	Item
    No.	 	Dynamac
    Part

    Number	 	Product
    Description	 	Delivery
    Status
	1	 	CPM-2050	 	Calibrated Probe Set – Probes & Cal Standards	 	Immediate
	2	 	CPM-3050	 	Calibrated Probe Set – Probes & Cal Standards	 	Immediate
	3	 	CPM-3075	 	Calibrated Probe Set – Probes & Cal Standards	 	Immediate
	4	 	CMP-9050	 	Calibrated Probe Set – Probes & Cal Standards	 	Immediate
	5	 	CPM-6050	 	Calibrated Probe Set – Probes & Cal Standards	 	Immediate
	6	 	HPR-1410	 	Calibrated Probe Set – Probes & Cal Standards	 	Immediate
	7	 	HPR-2500	 	Calibrated probe Set – Probes & Cal Standards	 	Immediate
	8	 	GNP-5006	 	Utility Probe: Microwave Gain (Amplifier) Probe	 	Development
	9	 	GNP-5010	 	Utility Probe: Microwave Gain (Amplifier) Probe	 	Development
	10	 	BSP-5003	 	Utility Probe: Broadband DC Bias Probe	 	development
	11	 	IMP-5075	 	Utility Probe: Impedance Matching Probe	 	Immediate/Housing
	12	 	TEP-5006	 	Utility Probe:50 Ohm Termination Probe (2050)	 	Immediate/Housing
	13	 	TEP-7503	 	Utility Probe: 75 Ohm Termination Probe (3075)	 	Immediate/Housing
	14	 	THR-1450	 	Utility Probe: 50 Ohm Termination Probe (1410)	 	Immediate/Housing
	15	 	THR-2550	 	Utility Probe: 50 Ohm Termination Probe (2500)	 	Immediate/Housing
	16	 	SHP-5006	 	Utility Probe: Short (Ground) Probe (2050)	 	Immediate/Housing
	17	 	SHP-7503	 	Utility Probe: Short (Ground) Probe (3075)	 	Immediate/Housing
	18	 	SHR-1450	 	Utility Probe: Short (Ground) Probe (1410)	 	Immediate/Housing
	19	 	SHR-2550	 	Utility probe: Short (Ground) Probe (2500)	 	Immediate/Housing
	20	 	DEP-5003	 	Utility Probe: 3 GHz 50 Ohm Detector Probe	 	Immediate/Housing
	21	 	DEP-7501	 	Utility Probe: 3 GHz 75 Ohm Detector Probe	 	Immediate/Housing
	22	 	ANT-2458	 	Utility Probe: Dual Band WiFi Antenna Probe	 	Development
	23	 	ANT-8021	 	Utility Probe: .7-2.1 GHz Cellular Antenna Probe	 	Development
	24	 	ANT-1050	 	Utility Probe: GPS Antenna Probe	 	development
	25	 	UTF-3500	 	(300W) High Power Universal Transistor/Power
    Amplifier Test Fixture	 	Immediate
	26	 	UTF-1200	 	(120W) High Power Universal Transistor/Power
    Amplifier Test Fixture	 	Immediate
	27	 	TMF-2000	 	Tip Mount Chip Component Test Fixture	 	Immediate
	28	 	TMF-1400	 	Tip Mount Chip Component Test Fixture	 	Immediate
	29	 	CBF-3586	 	Test Platform with Multiple Probe Arms	 	Immediate
	30	 	UCF-0610	 	Universal Component Test Fixture 
	 	Immediate
	31	 	CLS-1272/3/4 	 	Universal Microstrip Circuit Board Test Fixtures	 	Immediate
	32	 	MBF-1110	 	EIA SMT Chip Component Test Fixture	 	Immediate
	33	 	CMP-4050	 	40 GHz Microprobe	 	Development
	34	 	CMP-6850	 	68 GHz Microprobe	 	Development
	35	 	 	 	Accessories for UTF-3500 and UTF-1200	 	Immediate
	36	 	AIM-8040	 	Plug & Play 5 GHz Impedance Analyzer Probe	 	Immediate
	37	 	AIM-8140	 	Plug & Play 14 GHz Impedance Analyzer Probe	 	Immediate


 




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Appendix B


Pricing Schedule


 


	Item No.	 	Dynamac Part Number	 	MSRP	 
	1	 	CPM-2050	 	$	3500	 
	2	 	CPM-3050	 	$	3200	 
	3	 	CPM-3075	 	$	3200	 
	4	 	CMP-9050	 	$	3800	 
	5	 	CPM-6050	 	$	4500	 
	6	 	HPR-1410	 	$	4100	 
	7	 	HPR-2500	 	$	4200	 
	25	 	UTF-3500	 	$	5700	 
	26	 	UTF-1200	 	$	3800	 
	27	 	TMF-2000	 	 	TBD	 
	28	 	TMF-1400	 	 	TBD	 
	29	 	CBF-3586	 	 	TBD	 
	30	 	UCF-0610	 	 	TBD	 
	31	 	CLS-1272/3/4	 	 	TBD	 
	32	 	MBF-1110	 	 	TBD	 
	33	 	CMP-4050	 	 	TBD	 
	34	 	CMP-6850	 	 	TBD	 
	35	 	Accessories for UTF-3500 and UTF-1200	 	 	TBD	 
	36	 	AIM-8040	 	$	5500	 
	37	 	AIM-8140	 	$	9000	 



 




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