Document:

Redacted Limited Liability Company Agreement

 Exhibit 10.2 
  

	***	TEXT OMITTED AND FILED SEPARATELY, CONFIDENTIAL TREATMENT REQUESTED UNDER 17 C.F.R. SECTIONS 200.80(b)(4) AND 240.24b-2 

 SUPPLY AGREEMENT 
 This agreement
(“Agreement”) is made effective as of March 18, 2008, (the “Effective Date”) by and between LifeStone Materials, LLC, a Delaware limited liability company (“SUPPLIER”), and Point Blank
Solutions, Inc., a Delaware corporation (“POINT BLANK”); (POINT BLANK and SUPPLIER may sometimes be referred to individually as a “Party” or collectively as the “Parties”). 
 NOW, THEREFORE, in consideration of the premises, the mutual promises, and the representations, warranties and covenants herein contained, the
sufficiency of which is hereby mutually acknowledged, the Parties agree as follows: 
 ARTICLE 1 
 TERM 
 This Agreement shall be
effective as of the Effective Date for an initial term of thirty-six (36) months (the “Initial Term”), and, unless earlier terminated as provided in Article 4, shall be automatically extended for indefinite additional one
(1) year terms under the terms and conditions of this Agreement (each an “Extended Term”), terminable by either party by giving the other party an advance written notice of six (6) months prior to the expiration of the
Initial Term or any Extended Term. For purposes of this Agreement, the Initial Term and any Extended Terms shall be collectively referred to as the “Term”. 
 In this Agreement the term “Affiliate” shall mean any Person directly or indirectly controlling, controlled by, or under common control
with the Person in question; if the Person in question is a corporation, any executive officer or director of the Person in question or of any corporation directly or indirectly controlling the Person in question. As used in this definition of
“Affiliate”, the term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by
contract, or otherwise. As used in this Agreement, the term “Person” means any individual, corporation, association, partnership, limited liability company, joint venture, trust, estate, or other entity or organization. 

ARTICLE 2 
 SUPPLIER PRODUCT
OBLIGATIONS 
 2.1 Products. 
 SUPPLIER agrees to sell to POINT BLANK the products described on Exhibit A attached hereto, conforming to the specifications described on Exhibit A attached hereto (the “Specifications”) or their equivalents
or replacements as may be amended from time to time by agreement of the Parties (the “Products”). Upon POINT BLANK’s request, the Parties shall discuss in good faith any changes requested by POINT BLANK to any of the
Products’ Specifications, and any required changes to the price of such Product resulting from the change in the Specifications, based on the principles set forth in Exhibit A and Exhibit B attached hereto. 

 2.2 Revised Products 
 (a) In the event that one or more POINT BLANK customers or prospective customers requests POINT BLANK to deliver equivalent or substitute woven products in place of the Products that require a change to the
Specifications, but that are goods that would reasonably be expected to be provided by POINT BLANK (taking into consideration technological, economic and manufacturing advances) (a “Revised Product”), SUPPLIER shall provide such
Revised Products, provided that POINT BLANK (i) order from SUPPLIER such quantities of the Revised Product such that it becomes commercially and technologically reasonable for the SUPPLIER to make such revisions to the Specifications;
(ii) request from SUPPLIER such supply dates that will afford SUPPLIER sufficient time to prepare for and make the necessary arrangements for the production of the Revised Product (taking into account SUPPLIER’s existing production
schedules, SUPPLIER’s need to make appropriate changes to the production process and equipment, SUPPLIER’s need to test-run the Revised Product, POINT BLANK’s reasonable undertakings towards its customers etc.); (iii) consult
with SUPPLIER on the proposed contemplated specifications of the Revised Product prior to committing to supply it to its customer and (iv) to the extent practical, attempt in good faith to agree with the customer on changes to such
specifications if SUPPLIER reasonably requests so. If all the above conditions are met, the revised Specifications shall be added to Exhibit A and the Revised Product shall be deemed a “Product”. 
 (b) In the event that SUPPLIER must make a capital investment in excess of [***] to provide Products meeting the revised Specifications, then
POINT BLANK (in the event that POINT BLANK is then a Member of SUPPLIER) shall loan on a pro rata basis with the other Members of SUPPLIER, in accordance with Section 5.07 of the LLC Agreement, the funds determined by SUPPLIER (in its
reasonable discretion) to be required, at an interest rate computed daily at [***] per annum (a “Capital Investment Loan”); provided, however, that POINT BLANK may, in its sole discretion, withdraw its request to amend
Exhibit A once SUPPLIER has indicated the amount of the capital investment necessary in connection with such revised Specifications. In the event that POINT BLANK is no longer a Member, then SUPPLIER may not be required by POINT BLANK to make
a capital investment in excess of [***] to comply with this section. 
 For purposes of this Agreement, (i) “LLC
Agreement” means the Limited Liability Company Agreement of SUPPLIER of even date herewith, as amended, and (ii) “Prime” means the LaSalle Bank National Association (Chicago, Illinois) publicly announced prime rate in effect
from time to time. 
 2.3 Product Delivery. 
 SUPPLIER will package Product for shipping from SUPPLIER’S plant located at Temple Building, 99 Roush Road, Anderson, South Carolina (the “Plant”) and POINT BLANK is responsible for transporting
Product from the Plant within forty-eight (48) hours of notification by SUPPLIER that the order has been fulfilled. The risk of loss [***] shall have the responsibility of insuring the Products against transportation loss and any other
loss or damage [***]. 
  

 2 

 2.4 Delivery of Raw Materials. 
 (a) POINT BLANK shall deliver, or cause to be delivered, to SUPPLIER at the Plant not more than [***] days and not less than (i) for orders
less than [***] pounds of Product, [***] days, (ii) for orders equal to or more than [***] and less than [***] pounds of Product, [***] days, and (iii) for orders equal to or more than [***] pounds
of Product, [***] days, prior to the requested delivery date of the related Products the yarn necessary to manufacture the Products for POINT BLANK (the “Raw Materials”), at no charge to SUPPLIER. For purposes of the previous
sentence the “yarn necessary to manufacture the Products” shall be an amount of yarn equal to the sum of [***]. Within ten (10) days of delivery of Raw Materials to SUPPLIER, SUPPLIER shall have the right to reject Raw
Materials as defective, thereafter Raw Materials shall be deemed acceptable and free of defects for purposes of this Agreement, except for latent defects that cannot be determined by reasonable inspection (“Latent Defect”), in which case
SUPPLIER shall notify POINT Blank as soon as practicable after discovery of such defect. 
 (b) Without the prior consent of POINT BLANK,
SUPPLIER shall not (i) use any raw materials in the production of the Products other than those provided by POINT BLANK or as directed by POINT BLANK or (ii) use any of the Raw Materials POINT BLANK delivered, or caused to be delivered,
for the production of Products other than for delivery to POINT BLANK pursuant to the Volume Forecast (defined below) and related purchase orders by POINT BLANK. 
 ARTICLE 3 
 PRODUCT OBLIGATIONS 
 3.1 Product Volume. 
 (a) Commencing
on the Effective Date, SUPPLIER shall sell to POINT BLANK during the Term, such quantity of Products as shall be specified on POINT BLANK purchase orders addressed to SUPPLIER in writing from time to time provided that SUPPLIER shall not be required
to fill orders of POINT BLANK that would require it to produce in any [***] more than [***] pounds of Products (“Maximum Monthly Capacity”). [***]. If POINT BLANK wishes to increase the Maximum Monthly Capacity,
it will notify SUPPLIER and the parties shall negotiate in good faith a possible expansion of the Plant and the terms and conditions of such expansion. Once a capacity expansion is agreed to and completed a new Maximum Monthly Capacity will be set.
POINT BLANK agrees that as of such time that SUPPLIER reaches Maximum Monthly Capacity (the “Start Date”), POINT BLANK will be obligated to purchase from SUPPLIER, at least, the lower of the following (the “Minimum
Order”) (i) [***] pounds of Product over each [***] (or the pro rata amount thereof for the portion of the first [***] during the Term), subject always to the Maximum Monthly Capacity; or (ii) the quantity of
Products equal to [***] of the needs of POINT BLANK and its Affiliates for woven fabrics for ballistic uses, over each [***] (or the pro rata amount thereof for the portion of the first [***] during the Term), that are to be
manufactured using Kevlar or Twaron (except for any quantities of woven fabric ordered by POINT BLANK from third parties after SUPPLIER failed to 

  

 3 

 
manufacture such quantities on a timely basis). The commitment shall be reduced by any amounts less than the Maximum Monthly Capacity that POINT BLANK
ordered and SUPPLIER was unable to deliver for any reason (excluding lack of Raw Materials) and by any amounts of Products rejected by POINT BLANK in accordance with the terms hereof. 
 3.2 Failure to Supply Volume Requirements. 
 If, in any month SUPPLIER fails to supply POINT BLANK’s binding orders (as set forth in Section 3.3 below) up to the Maximum Monthly Capacity (for any reason other than lack of Raw Materials), then POINT BLANK, in its sole and
absolute discretion may purchase the volume represented by the SUPPLIER shortfall from third parties, in which case SUPPLIER shall pay POINT BLANK any incremental costs, including without limitation, cost of Products, freight and expediting charges.
POINT BLANK shall be entitled to use quantities of Products that it has purchased from third parties prior to resuming purchases from SUPPLIER. 
 3.3 Monthly Estimates. 
 On or before the 15th day of each month during the Term, POINT BLANK shall provide SUPPLIER with
POINT BLANK’s best estimate of POINT BLANK’s anticipated requirements under subsection 3.1 for Products during the immediately succeeding twelve (12) months listed by Product type and amount (the “Volume
Forecast”). No forecasted quantity for any month shall exceed the Maximum Monthly Capacity. The requirements (type and amount) for each of the first three (3) months of each Volume Forecast shall be binding on the parties and shall be
deemed as a binding order submitted by POINT BLANK for said three (3) months. POINT BLANK and SUPPLIER acknowledge that from time to time considerable variation will occur between the estimated requirements for the remaining nine
(9) months of each Volume Forecast. Notwithstanding such variation, SUPPLIER shall use its commercially reasonable efforts to accommodate such delivery requirements (but not including any obligation of SUPPLIER to default in its commitments
under other contractual obligations). SUPPLIER shall provide POINT BLANK with advance written notice, as soon as reasonably possible, of any anticipated inability to produce and deliver Products in such quantities as are necessary to meet POINT
BLANK’s requirements. 
 3.4 Suspension of Work. 
 If, for reasons beyond POINT BLANK’s reasonable control, POINT BLANK no longer needs previously ordered Product, POINT BLANK may delay, reduce or suspend its purchase of Products hereunder, which production has
not commenced at the time SUPPLIER receives the notice of delay, reduction or suspension, as POINT BLANK may determine to be appropriate for the convenience of POINT BLANK; provided that any delayed order shall not be used to satisfy the Minimum
Order during the period of delay. 
 3.5 Unauthorized Distribution; Overruns and Second-Quality Goods. 
 No Products (including without limitation, production overruns, second-quality goods, and any Products rejected or returned by POINT BLANK) bearing any of
POINT BLANK trademarks, trade names, or Intellectual Property (“Rejected Goods”) shall be sold, distributed or used in any manner to any Person other than POINT BLANK by SUPPLIER or any of its 

  

 4 

 
subcontractors without the prior written consent of POINT BLANK. The Parties shall endeavor to mutually agree in good faith upon the manner in which any, if
any, Rejected Goods may be used, sold or distributed. In the event SUPPLIER and POINT BLANK cannot reach agreement within thirty (30) days concerning liquidation of the Rejected Goods, SUPPLIER shall destroy such Rejected Goods all at
SUPPLIER’s cost and expense. SUPPLIER shall not deliver any Products that have been previously returned as Defective without first notifying the POINT BLANK representative. SUPPLIER shall be responsible for all production overruns of raw
materials and finished Products outside SUPPLIER-quoted manufacturing tolerances. 
 ARTICLE 4 
 REPRESENTATIONS, WARRANTIES AND COVENANTS. 
 SUPPLIER hereby agrees, represents and warrants to POINT BLANK that: 
 4.1 Each Product shall meet the applicable Specifications set
forth in Exhibit A as amended from time to time, be of even kind and quality, and packaged and labeled as the Specifications may require; provided, however, that any failure of Products to meet any of the above requirements
attributable to a Latent Defect in Raw Materials which was not discovered by SUPPLIER prior to delivery to POINT BLANK shall not be deemed a breach of this warranty. 
 4.2 SUPPLIER shall convey good title to the Products and that the Products shall be delivered free of any lien or encumbrance, and free from defects in workmanship or (subject to Sections 2.4(a) and 4.7) materials;
provided, however, that SUPPLIER makes no representation or warranty under this Section 4.2 applicable to the Raw Materials that are a part of such Product to the extent that such Raw Materials delivered, or caused to be
delivered, by POINT BLANK to SUPPLIER for delivery of such Product, at the time of such delivery, were not conveyed with good title free and clear of any liens or encumbrances and free from Latent Defects in workmanship or material; 
 4.3 SUPPLIER has all approvals, consents and qualifications necessary to produce the Products and such production of the Products shall not contravene
any applicable legal requirements of any governmental body. 
 4.4 SUPPLIER’s manufacture and delivery of the Products will not infringe
on the Intellectual Property (as defined below) rights of any third party, and no claim has been made, notice given or dispute arisen to that effect or with regard to any Intellectual Property SUPPLIER intends, or is required, to use in such
manufacture and delivery of the Products; provided, however, that SUPPLIER makes no such representation or warranty under this Section 4.4 applicable to the Raw Materials that are a part of such Product to the extent that
such Raw Materials delivered, or caused to be delivered, by POINT BLANK to SUPPLIER for delivery of such Product, at the time of such delivery, were infringing on the Intellectual Property rights of any third party. 
 4.5 SUPPLIER warrants that all Products shall conform to a production sample that is approved by POINT BLANK, including without limitation that such
Products shall be consistent with National Institute of Justice and First Article testing standards and the testing requirements 

  

 5 

 
provided on Exhibit C; provided, however, that SUPPLIER makes no representation or warranty under this Section 4.5
applicable to such Products to the extent that the Raw Materials delivered, or caused to be delivered, by POINT BLANK to SUPPLIER for delivery of such Product, at the time of such delivery, did not conform to the production samples previously
approved by POINT BLANK as the result of a Latent Defect. 
 4.6 SUPPLIER is not subject to any restrictive obligations imposed by former or
existing clients or any other Person that would impair its ability to perform its obligations and deliver the Products to be provided pursuant to this Agreement. SUPPLIER shall not place any other restrictive obligations or influence on other
suppliers. 
 4.7 SUPPLIER hereby assigns, to the extent assignable by SUPPLIER, for the benefit of POINT BLANK warranties associated with
the Products provided by any manufacturer, subcontractor or third party and SUPPLIER shall enforce such warranties on POINT BLANK’s behalf upon POINT BLANK’s written request. The warranties made or assigned by SUPPLIER pursuant to this
Agreement or otherwise shall survive the acceptance of any payment for the Products by POINT BLANK. The warranties made or assigned to POINT BLANK by SUPPLIER pursuant to this Agreement or otherwise shall, to the extent SUPPLIER has power to do so,
benefit POINT BLANK and its subsidiaries and affiliated companies and their respective employees, agents, representatives, assigns, subcontractors and customers. By assigning any warranty to POINT BLANK, SUPPLIER shall not be deemed to represent to
POINT BLANK that such assignment is valid or the extent of the rights of POINT BLANK pursuant to such assignment. 
 4.8 In the event that
(i) POINT BLANK has ordered an average of [***] pounds of Products per [***] over the previous [***] period (or such shorter period during the first [***] of the Initial Term) or (ii) POINT BLANK has ordered
[***] over the previous [***] period (or such shorter period during the first [***] of the Initial Term), the Product Price or Adjusted Product Price, as then applicable, (excluding the cost of the yarn), the terms,
representations, warranties and benefits granted to POINT BLANK herein are comparable to or better than the equivalent prices (excluding the cost of the yarn), terms, warranties and benefits offered by SUPPLIER to its other customers. 
 4.9 All Intellectual Property, Improvements and Derivative Work owned by or licensed to SUPPLIER as of the date hereof which is used for the production
of the Products is sub-licensable by SUPPLIER in accordance with Section 9.2 hereof and any such sub-license will not be a violation or breach of any license or agreement to which SUPPLIER is a party or the rights to such Intellectual Property,
Improvements or Derivative Work of a third party. 
 THE FOREGOING REPRESENTATIONS AND WARRANTIES ARE EXPRESSLY IN LIEU OF ALL OTHER REPRESENTATIONS AND
WARRANTIES, AND ALL SUCH OTHER WARRANTIES AND REPRESENTATIONS OF WHATEVER KIND ARE HEREBY DISCLAIMED BY SUPPLIER AND ITS AFFILIATES AND WAIVED BY POINT BLANK. EXCEPT AS SPECIFICALLY SET FORTH IN THIS AGREEMENT, SUPPLIER SHALL HAVE NO LIABILITY TO
POINT BLANK OR ANY OF ITS AFFILIATES FOR ANY GENERAL, INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE, OR CONSEQUENTIAL DAMAGES, INCLUDING WITHOUT LIMITATION LOST PROFITS ARISING OUT OF THE MANUFACTURE, IMPORTATION, USE, OFFER FOR SALE OR SALE OF THE
PRODUCT; PROVIDED, HOWEVER, THAT IN THE EVENT THAT PRODUCT IS 

  

 6 

 
DETERMINED TO BE DEFECTIVE (EITHER BY AGREEMENT OF THE PARTIES OR A DETERMINATION BY AN INDEPENDENT LABORATORY) AS A RESULT OF SUPPLIER’S HANDLING,
STORAGE OR MANUFACTURING OF THE PRODUCT, THEN DAMAGES SHALL INCLUDE ANY AND ALL OF POINT BLANK’S DIRECT OUT-OF-POCKET COSTS (SPECIFICALLY EXCLUDING, LOST PROFITS AND REPUTATIONAL DAMAGES) INCURRED IN CONNECTION WITH THE DEFECTIVE PRODUCT,
INCLUDING PRODUCTION COSTS, SCRAP MATERIAL AND SHIPPING AND ADMINISTRATIVE COSTS OF ANY RECALL. SUPPLIER MAKES NO WARRANTIES OF MERCHANTABILITY OR FITNESS FOR ANY PURPOSE WITH RESPECT TO THE PRODUCT, EXCEPT AS THIS ARTICLE 4 EXPRESSLY PROVIDES.

 ARTICLE 5 
 QUALITY
AND SERVICE 
 5.1 If SUPPLIER identifies Products that do not meet or exceed POINT BLANK’s Specifications during their
manufacturing process, SUPPLIER shall not ship such Products until the manufacturing process has been corrected and the Products conform to the Specifications, agreements, representations and warranties contained in this Agreement or as the Parties
may otherwise agree. 
 5.2 Within fifteen (15) days of delivery of Products to POINT BLANK, POINT BLANK shall have the right to reject
Products as Defective by delivery of a Notice of Defect (as defined below), thereafter and notwithstanding the warranties made by SUPPLIER under Section 4 above, Products shall be deemed accepted by POINT BLANK and free of Defects for purposes
of this Agreement, except for Latent Defects, in which case POINT BLANK shall notify SUPPLIER as soon as practicable after discovery of such defect. POINT BLANK shall have no claim against SUPPLIER for any deficiency in the quantity or packaging of
any Product supplied to it under this Agreement unless it gives SUPPLIER a notice of the deficiency within fifteen (15) days from receipt of the Product. 
 5.3 For the purposes of this Agreement a Product shall be deemed “Defective” if it does not conform to any representation or warranty under Sections 4.1, 4.2, 4.3, 4.4 and 4.5. If POINT BLANK believes
that any Product is Defective it shall give SUPPLIER a notice describing the defect (a “Notice of Defect”) as soon as it discovers the defect. POINT BLANK may return any Product (and subject to receipt of the Defective Product,
SUPPLIER shall reimburse POINT BLANK for the [***] with regard to which (i) SUPPLIER agrees to such return, (ii) SUPPLIER acknowledges that the Product is Defective, (iii) the Product is declared Defective by an Independent
Laboratory, as described below, (iv) POINT BLANK has reason to suspect that such Products are Defective or (v) POINT BLANK has reason to believe that such Products are part of a lot or manufacturing run of Products that have Defective
Products within the lot or run; provided that the maximum amount of Product that may be returned pursuant to clauses (iv) and (v), together, during any [***] period shall be not more than [***]. POINT BLANK will allow SUPPLIER to
inspect the Product suspected to be Defective and take samples thereof. SUPPLIER will respond to the Notice of Defect within fifteen (15) days from receipt of the Notice. If SUPPLIER does not acknowledge that the Product is Defective then,
except with regard to Products returned by POINT BLANK pursuant to clause (iv) or (v) hereof, POINT BLANK and SUPPLIER will deliver samples of the Product suspected to be defective for inspection by an independent laboratory (the
“Independent Laboratory”) agreed to by the Parties. The decision of the Independent Laboratory will be final and binding and its costs will be paid by the party whose position regarding the product was rejected. 
  

 7 

 5.4 In the event that POINT BLANK determines to return Product to SUPPLIER in accordance with
Section 5.3 hereof, and SUPPLIER does not have readily available non-defective Product to replace the returned product, POINT BLANK shall have the immediate right (but not the obligation) for a period not to exceed forty-five
(45) days from the date POINT BLANK notifies SUPPLIER in writing of its intention to return such Product (the “Alternate Supply Period”), to have replacement products (the “Replacement Products”) produced for
POINT BLANK by an alternate supplier (the “Alternate Supplier”), which Alternate Supplier shall be determined in POINT BLANK’s sole and absolute discretion. If at any time during the Alternate Supply Period, POINT BLANK
declares a breach under Section 11.1(a) hereof, the thirty (30) day cure period provided therein for breach shall run concurrently with the Alternate Supply Period. During the Alternate Supply Period, (i) all Replacement Products
purchased by POINT BLANK from the Alternate Supplier shall, for purposes of the obligation pursuant to Section 3.1 hereof, be deemed to be Product purchased from SUPPLIER hereunder, (ii) upon POINT BLANK’s direction, SUPPLIER shall
deliver, or cause to be delivered, to the Alternate Supplier (instead of to SUPPLIER) the Raw Material previously delivered to SUPPLIER by POINT BLANK necessary to manufacture the Replacement Products for POINT BLANK within fourteen (14) days
of receipt of notice of POINT BLANK’s request to have such Raw Materials delivered to the Alternate Supplier, and (iii) for purposes of Article 9 hereof, SUPPLIER shall be deemed to no longer be able to produce and cause to be delivered to
POINT BLANK the Product required to be produced hereunder, such that SUPPLIER shall be deemed to hereby grant to POINT BLANK the POINT BLANK License and the right to grant the Sublicense (without the obligation to make royalty payments) to the
Alternate Supplier in accordance with Section 9.2 and with the restrictions provided therein. 
 ARTICLE 6 
 CONSIDERATION 
 6.1 Price.

 (a) SUPPLIER shall invoice POINT BLANK in respect of each Product for [***] (“Product Price”). 
 (b) In the event that during any [***] POINT BLANK shall have purchased from SUPPLIER an aggregate of more than [***], then the Product
Price of any additional [***] purchased during such [***] shall be based upon the Product Prices provided on Exhibit B-2, subject to adjustment as provided in subsection (c) below. In addition, not more than [***]
following the date on which POINT BLANK purchases an aggregate during any [***] in excess of [***] of Fine Product, SUPPLIER shall deliver to Point Blank cash in the amount equal to [***] For purposes of this Section,
[***]. 
 (c) The Product Prices will be adjusted as follows: 
 (i) [***] 
  

 8 

 (ii) [***] 
 6.2 Payment Terms and Invoices for Products. 
 SUPPLIER’s payment terms shall provide that invoices for Products that are received by POINT BLANK shall be paid [***]. Invoices shall be dated the date of shipment. [***]. SUPPLIER shall have [***] from the date
that POINT BLANK received the Product invoiced within which to notify POINT BLANK in writing of any claims SUPPLIER might have for payment not made in accordance with the payment schedule outlined in this paragraph 6.2, or such claims shall be
deemed waived by SUPPLIER, including but not limited to all claims for any interest accrued. All invoices for costs to be paid by POINT BLANK, including without limitation freight costs, must be accompanied with a copy of the invoice or bill for
such costs, and backup documentation. In addition to invoices, monthly statements shall be submitted by SUPPLIER to POINT BLANK. 
 6.3 [***]

 ARTICLE 7 
 STATUS OF
PARTIES 
 7.1 Independent Contractor. 
 The Parties expressly understand and agree that SUPPLIER is acting as an independent contractor. Nothing in this Agreement is intended to create a relationship, express or implied, of employer-employee or
principal-agent between POINT BLANK and SUPPLIER and any individual employed to work under this Agreement by SUPPLIER. SUPPLIER shall determine and have sole discretion over the manner and methods utilized to provide Products which comply with this
Agreement. SUPPLIER shall be solely responsible for the direction, control and supervision of its and its subcontractors’ acts and the acts of its and its subcontractors’ employees incident to the performance of this Agreement. SUPPLIER
shall not have nor shall it represent itself as having any authority to make contracts in the name of or on behalf of POINT BLANK or to pledge POINT BLANK’s credit or to extend credit POINT BLANK’s name, or to obligate POINT BLANK in any
way. 
 7.2 Expenses. 
 Except as otherwise expressly provided herein, all expenses incurred by SUPPLIER in connection with this Agreement and the manufacture and delivery of the Products shall be the sole responsibility of SUPPLIER. In the event SUPPLIER makes
unauthorized representations or incurs unauthorized expenses resulting in the assertion of a claim against POINT BLANK, SUPPLIER shall indemnify and hold harmless POINT BLANK against all such claims. 
 7.3 Subcontractor Approval. 
 SUPPLIER
recognizes POINT BLANK has chosen it to perform the obligations of this Agreement because of the expertise of SUPPLIER and its employees. Any subcontractor or agent utilized by SUPPLIER for its performance under this Agreement to manufacture
Products must be specifically identified to POINT BLANK by SUPPLIER and approved by POINT BLANK in writing prior to the provision of services or goods by such subcontractor or agent. 
  

 9 

 7.4 Agreement Binding on Subcontractors. 
 Any subcontractors approved by POINT BLANK hereunder shall agree to be bound by all applicable provisions of this Agreement. SUPPLIER shall ensure that
any approved agent, representative, assign or subcontractor has executed an appropriate agreement prior to the commencement of work. Without limiting SUPPLIER’s obligation to obtain an agreement with all approved subcontractors agreeing to be
bound by all provisions of this Agreement, SUPPLIER shall provide evidence that all subcontractors are carrying and maintaining insurance policies with coverages, in the same manner and amounts as SUPPLIER is obligated to obtain and furnish pursuant
to Section 10 below. 
 ARTICLE 8 
 COMPLIANCE 
 8.1 Government Regulations. 
 Unless otherwise exempt, 
 (a) the clauses
required to be incorporated into government contracts under 41 C.F.R. sections 60-1.4, 60-250.5(a), 60-741.5(a), 48 C.F.R. 22.810, 48 C.F.R. 22.1310, and 48 C.F.R. 22.1408 are incorporated into this Agreement by reference; 
 (b) in addition to clauses required in (a) above, SUPPLIER shall comply with the following specific Federal Acquisition Regulation
(“FAR”) and Defense Federal Acquisition Regulations Supplement (“DFARS”) clauses: 
 (i) 48 C.F.R.
§52.219-8, Utilization of Small Business Concerns (May 2004); 
 (ii) 48 C.F.R. §52.203-6, Restrictions on Subcontractor Sales to
the Government (SEP 2006), with Alternate I (OCT 1995); 
 (iii) 48 C.F.R. §52.222-3, Convict Labor (JUNE 2003); 
 (iv) 48 C.F.R. §52.225-13, Restrictions on Certain Foreign Purchases (FEB 2006) 
 (v) 48 C.F.R. §252.204-7000, Disclosure of Information (DEC 1991); 
 (vi) 48 C.F.R. §252.225-7014, Preference for Domestic Specialty Metals, Alternate I (APR 2003); 
 (vii) 48 C.F.R. §252.237-7019, Training for Contractor Personnel Interacting with Detainees (SEP 2006); 
 (viii) 48 C.F.R.
§252.247-7023, Transportation of Supplies by Sea (MAY 2002); 
  

 10 

 (ix) 48 C.F.R. § 252.247-7024, Notification of Transportation of Supplies by Sea (MAR 2000); and

 (x) 48 C.F.R. § 252.222-50, Combating Trafficking in Persons (August 2007). 
 (c) SUPPLIER shall comply with all requirements of (i) Executive Order 11246, as amended, and applicable regulations issued thereunder,
(ii) the requirements of Section 503 of the Rehabilitation Act of 1973 as amended, and the regulations issued thereunder, (iii) the requirements of Section 503 of the Vietnam Era Veterans’ Readjustment Assistance Act of
1972, as amended, 38 U.S.C. § 4212, (iv) the reporting requirements set forth in 41 C.F.R. 60-250.5 of the Americans with Disabilities Act of 1990, 42 U.S.C. § 12112; and (v) the requirements of 41 C.F.R. Chapter 60. 

With respect to (v) above, SUPPLIER certifies that if it has fifty (50) or more employees and if it anticipates sales to POINT BLANK in
connection with government contracts of $50,000 or greater, it will develop a written affirmative action compliance program for each of its establishments consistent with the rules and regulations by the Department of Labor at 41 C.F.R. Chapter 60.

 8.2 General Laws and Permits. 
 With respect to this Agreement, SUPPLIER shall (i) comply with any and all applicable federal, state, local or agency laws, regulations, rules, ordinances or other directives, and (ii) obtain all releases, licenses, permits or
other authorizations required by any governmental body or authority. 
 8.3 Diverse Suppliers (Minority or Women-Owned Business
Enterprises). 
 POINT BLANK has a policy that requires SUPPLIER, whenever practicable, to use diverse suppliers, including contractors
and subcontractors, if such suppliers are both qualified and competitive. A diverse supplier is a for-profit enterprise located in the United States or its trust territories, which is controlled, operated and 51 percent owned by a minority member or
woman. Minority members are individuals who are African American, Hispanic American, Native American, Asian-Pacific American and Asian-Indian American. SUPPLIER will report expenditures on diverse suppliers quarterly. 
 8.4 Child Labor and Forced Labor. 
 SUPPLIER represents, warrants and covenants that SUPPLIER and its subcontractors do not and will not employ children, prison labor, indentured labor, bonded labor or use corporal punishment or other forms of mental and physical coercion as
a form of discipline. In the absence of any national or local law, POINT BLANK and SUPPLIER agree to define “child” as less than 15 years of age. If local law sets the minimum age below 15 years of age, but is in accordance with
exceptions under International Labor Organization Convention 138, the lower age will apply. POINT BLANK has the right to make unannounced inspections, and conduct 

  

 11 

 
appropriate audits of books and records, of all of SUPPLIER’s premises and any other premises employed in connection with SUPPLIER’s provision of
Products or parts thereof hereunder, to ensure compliance with this Section. SUPPLIER shall, and shall cause each entity involved through SUPPLIER in the provision of Products or parts thereof hereunder, to comply with any code of conduct or similar
policy statement promulgated by POINT BLANK from time to time. 
 8.5 Governmental Inspections/Findings. 
 SUPPLIER will immediately notify POINT BLANK of, and provide POINT BLANK with all documents relating to (including the results of), any non-routine
inquiry, investigation, inspection, or any other action by any governmental body or unit thereof, with respect to the manufacture, storage, or delivery of the Product(s), or components thereof, which pertains to product quality and/or safety, unless
not permitted to do so by such government body. In addition, SUPPLIER will immediately notify POINT BLANK in the event that it becomes aware or has reason to believe that there may be an issue of quality or safety, misbranding or adulteration
relating to any Product or component thereof. 
 ARTICLE 9 
 INTELLECTUAL PROPERTY 
 9.1 Definitions. 
 For purposes of this Article 9: 
 (a)
“POINT BLANK” in this Section 9 means POINT BLANK (excluding SUPPLIER and its subsidiaries) and its parents, subsidiaries, divisions and affiliates and each of their employees, officers and agents. 
 (b) “Intellectual Property” means (i) inventions, Improvements, discoveries, know how, concepts and ideas, whether patentable or
not; (ii) patents, revalidations, industrial designs, industrial models and utility models, design patent rights, patent applications (including reissues, continuations, divisions, continuations-in-part and extensions) and patent disclosures;
(iii) trade secrets and proprietary or confidential information and rights in any jurisdiction to limit the use or disclosure thereof by any Person; (iv) copyrights, copyright registrations and applications for registration of copyrights
in any jurisdiction, and any renewals or extensions thereof and any moral rights existing in connection therewith; and (v) all other intellectual property or industrial property rights recognized anywhere. 
 (c) “SUPPLIER” in this Section 9 means SUPPLIER and its parents, subsidiaries, divisions, affiliates, subcontractors (excluding
POINT BLANK and its subsidiaries) and each of their employees and agents. 
 (d) “Improvements” in this Section 9 means
any improvement, enhancement or refinement, whether patentable or unpatentable, which relates to, in whole or in part, any of the Intellectual Property and which is reasonably regarded as being primarily (or solely) valuable because it enables the
Intellectual Property to be used in a more efficient manner. An improvement is not, by itself, a Derivative Work. 
  

 12 

 (e) “Derivative Work” means an improvement, enhancement, refinement, derivative work,
modification or other new invention or discovery, whether patentable or unpatenable, which relates to, in whole or in part, any of the Intellectual Property, and which is reasonably regarded as being potentially valuable because it constitutes a
useful product or method unto itself, or because it enables the Intellectual Property to be used in connection with products or services other than the Products, and not merely because it enables the Intellectual Property to be used in
connection with the Products in a more efficient manner. 
 (f) “Licensed Intellectual Property” means Intellectual
Property, Improvements and Derivative Work owned by or licensed to SUPPLIER on the last day prior to the day on which POINT BLANK receives the right to the POINT BLANK License pursuant to Section 9.2 below, which is or has been used for
the production of the Products, except for such licenses that prevent SUPPLIER from granting sub-licenses; provided that SUPPLIER shall provide written notice to POINT BLANK in the event that any such license is not sub-licensable pursuant to this
Agreement prior to the use of such license in the production of Products. 
 9.2 License and Sublicense. 
 (a) (i) After termination of this Agreement (except for termination by SUPPLIER for cause) (ii) in the event that SUPPLIER can no longer produce and
cause to be delivered to POINT BLANK any of the Products required to be so produced and delivered hereunder, or (iii) in the event that POINT BLANK has requested SUPPLIER to produce Product in excess of the Maximum Monthly Capacity and SUPPLIER
is unable to satisfy such orders within a reasonable period of time, SUPPLIER hereby grants POINT BLANK a non-exclusive, AS IS, and without any warranties or representations of any kind (except the representation and warranty included in
Section 4.9 hereof), license to exploit the Licensed Intellectual Property to make, have made for it by others, use and sell anywhere in the world soft body armor that utilizes such Licensed Intellectual Property (collectively, the
“POINT BLANK License”). POINT BLANK shall have the right to sublicense said Licensed Intellectual Property to any third party manufacturer who makes soft body armor or Products for POINT BLANK (a “Sublicensee”) for
the sole purpose of supplying POINT BLANK with Products (including Revised Products). Sublicensees shall not be permitted to grant a sublicense or assign their sublicense to any other Person. The license provided in this subsection 9.2 shall survive
any termination of this Agreement unless otherwise agreed upon in writing by POINT BLANK and SUPPLIER. 
 (b) POINT BLANK shall pay SUPPLIER
reasonable royalties for each product manufactured by it, any of its Affiliates or any Sublicensee, to the extent the Licensed Intellectual Property is used in such manufacturing. Under no circumstance shall POINT BLANK be required to pay royalties
in respect of Intellectual Property independently owned by or licensed to POINT BLANK or developed by SUPPLIER with material technological assistance of POINT BLANK or material contribution of POINT BLANK personnel assigned to SUPPLIER. If the
parties fail to agree on the rate of royalties, the matter will be referred to arbitration pursuant to Section 12.2; provided, that during the period that any such dispute has been referred to arbitration or is under review by an
arbitrator pursuant to Section 12.2, POINT BLANK shall continue to have the right to use the Licensed Intellectual Property in accordance with the POINT BLANK License and provided further, that upon SUPPLIER’s request the
arbitrator will set an interim rate of royalties. The royalties for each calendar year shall be paid 

  

 13 

 
within 90 days from the end of such year. At the time of payment, POINT BLANK shall provide SUPPLIER with a detailed report and set of calculations
supporting the payment. Any amount of royalties which is not paid on time shall bear interest at the rate per annum of [***]. The license provided in this subsection 9.2 shall survive any termination of this Agreement unless otherwise agreed
upon in writing by POINT BLANK and SUPPLIER. [***]. 
 (c) Unless otherwise agreed by the Parties, in no event shall any such
Sublicensee be granted or be deemed to have any right to exploit the POINT BLANK License to manufacture or produce any product for a party other than POINT BLANK or its Affiliates and prior to any sublicense of the Licensed Intellectual Property to
any such Sublicensee, POINT BLANK shall obtain the right for itself and for SUPPLIER to have regular audits performed by an independent third party, appointed by SUPPLIER and reasonably acceptable to POINT BLANK, of the Sublicensee’s books and
records and manufacturing and production facilities for the sole purpose of (i) insuring such Sublicensee’s compliance with such restriction on exploitation of the Sublicense and (ii) determining the quantities of products
manufactured by the Sublicensee with the use of the Licensed Intellectual Property for the purpose of determining the royalties due to SUPPLIER. POINT BLANK will procure that the Sublicensee will cooperate with such auditor. SUPPLIER will bear the
costs of the audit, unless the audit shows that the Sublicensee did not comply with this Section 9.2, in which case POINT BLANK shall procure that the Sublicensee bear the cost of the audit. 
 (d) POINT BLANK shall, prior to disclosing any information relating to Intellectual Property, Improvements and Derivative Work to any potential
Sublicensee or any other third party, procure that an appropriate confidentiality agreement will be executed by such third party and such agreement will name SUPPLIER as a third party beneficiary and a copy thereof shall be delivered to SUPPLIER.

 9.3 Invention and Nondisclosure Agreement. 
 When requested by POINT BLANK in writing, each of SUPPLIER’s employees, agents or subcontractors performing work in connection with the Products under this Agreement shall sign an Invention and Nondisclosure
Agreement in a form reasonably required by POINT BLANK. 
 9.4 Record Keeping. 
 SUPPLIER and its employees and subcontractors shall keep written records of their activities relating to work performed or Products supplied to POINT
BLANK pursuant to this Agreement and shall keep written records of all information, Intellectual Property, and work product originated or created or developed for POINT BLANK, if any. SUPPLIER shall promptly disclose to POINT BLANK upon its request
all such records, and shall permit POINT BLANK to inspect, review and copy all such records. 
 9.5 Return of Documents and Things.

 All work product, records, Intellectual Property and other materials, documents and things made available to SUPPLIER by POINT BLANK or
created or developed by SUPPLIER for POINT BLANK shall be delivered to POINT BLANK upon written request by POINT BLANK or upon the expiration or earlier termination of this Agreement. 
  

 14 

 9.6 Intellectual Property Indemnification by SUPPLIER. 
 SUPPLIER shall, at its sole expense, hold harmless, indemnify and defend POINT BLANK and its subsidiaries and affiliates (each, a “PB Indemnified
Party”) against any and all claims or actions for the infringement of any Intellectual Property in and to the Products (collectively “POINT BLANK Action”). SUPPLIER shall indemnify each PB Indemnified Party against any and
all (subject to the disclaimer below) damages, costs and expenses, including attorneys’ fees, arising from or relating to any POINT BLANK Action. SUPPLIER shall, at such PB Indemnified Party’s election and in its sole discretion,
(1) defend such PB Indemnified Party against any POINT BLANK Action at SUPPLIER’s expense using counsel reasonably acceptable to such PB Indemnified Party or (2) reimburse such PB Indemnified Party for any and all costs, expenses and
legal fees incurred by it in connection with any POINT BLANK Action. Notwithstanding any other provision of this Agreement, neither party shall enter into a settlement or compromise of any POINT BLANK Action without the other party’s prior
written approval which shall not be unreasonably withheld. The PB Indemnified Party shall notify SUPPLIER of a POINT BLANK Action within a reasonable time after it has received written notification of such POINT BLANK Action. 
 If SUPPLIER fails, refuses or is unable to cure or resolve a POINT BLANK Action within forty-five (45) days of receipt of notice from a PB
Indemnified Party or of the date SUPPLIER knew or should have known of the POINT BLANK Action, such PB Indemnified Party, in its sole discretion, and at SUPPLIER’s sole expense and risk of loss, may (1) procure the right to continue
making, using, selling or otherwise exploiting any allegedly infringing, misappropriated or misused material, goods, apparatus, device, information, method, process, part or thing on terms acceptable to such PB Indemnified Party; (2) replace
same with materials, goods, apparatus, devices, information, methods, processes, parts or things which are not alleged to be infringing, misappropriated or misused; (3) modify any allegedly infringing, misappropriated or misused material,
goods, apparatus, device, information, method, process, part or thing to cease being not infringing or becomes properly used or (4) have any allegedly infringing, misappropriated or misused material, goods, apparatus, device, information,
method, process, part or thing removed from such PB Indemnified Party’s premises. Upon receipt of a written request for reimbursement, SUPPLIER shall reimburse each PB Indemnified Party for any and all costs, expenses and fees actually arising
from or relating to any such action by such PB Indemnified Party within thirty (30) days of such receipt. 
 EXCEPT AS SET FORTH IN THIS
AGREEMENT, SUPPLIER SHALL HAVE NO LIABILITY TO POINT BLANK OR ANY OF ITS AFFILIATES FOR ANY GENERAL, INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE, OR CONSEQUENTIAL DAMAGES, INCLUDING WITHOUT LIMITATION LOST PROFITS ARISING OUT OF ANY CLAIM BASED ON THIS
ARTICLE 9; PROVIDED, HOWEVER, THAT IN THE EVENT THAT PRODUCT DELIVERED TO POINT BLANK IS DETERMINED (EITHER BY AGREEMENT OF THE PARTIES OR RESOLUTION OF AN POINT BLANK ACTION AGAINST POINT BLANK OR SUPPLIER) TO INFRINGE ANY INTELLECTUAL PROPERTY,
THEN DAMAGES SHALL INCLUDE ANY AND ALL OF POINT BLANK’S DIRECT OUT-OF-POCKET COSTS (SPECIFICALLY EXCLUDING LOST PROFITS AND REPUTATIONAL DAMAGE) INCURRED IN CONNECTION WITH ANY PRODUCT THAT CANNOT BE SOLD OR IN CONNECTION WITH WHICH POINT BLANK
MUST 

  

 15 

 
INDEMNIFY A THIRD PARTY AND REPLACE SUCH PRODUCTS DELIVERED THERETO, INCLUDING, PRODUCTION COSTS, SCRAP MATERIAL AND SHIPPING AND ADMINISTRATIVE COSTS OF ANY
RECALL. 
 9.7 Intellectual Property Indemnification by POINT BLANK. 
 POINT BLANK shall, at its sole expense, hold harmless, indemnify and defend SUPPLIER against any and all claims or action against SUPPLIER which relate to
any infringement of Intellectual Property in and to the Products resulting from the use of any Intellectual Property that was provided in writing to SUPPLIER by POINT BLANK, its subsidiaries or affiliates (a “PB Indemnifying Party”)
and which POINT BLANK directed SUPPLIER in writing to use in the manufacture of the Products sold to POINT BLANK or requirements made by any PB Indemnifying Party (collectively, “SUPPLIER Action”), unless SUPPLIER had actual
knowledge that using such information or complying with such requirement will infringe the Intellectual Property of a third party. POINT BLANK shall indemnify the SUPPLIER against any and all (subject to the disclaimer below) damages, costs and
expenses, including attorneys’ fees, arising from or relating to any SUPPLIER Action. POINT BLANK shall, at SUPPLIER’s election and in its sole discretion, (1) defend SUPPLIER against any SUPPLIER Action at POINT BLANK’s expense
using counsel reasonably acceptable to SUPPLIER or (2) reimburse SUPPLIER for any and all costs, expenses and legal fees incurred by it in connection with any SUPPLIER Action. Notwithstanding any other provision of this Agreement, neither party
shall enter into a settlement or compromise of any SUPPLIER Action without the other party’s prior written approval which shall not be unreasonably withheld. SUPPLIER shall notify POINT BLANK of an SUPPLIER Action within a reasonable time after
it has received written notification of such Action. 
 EXCEPT AS SET FORTH IN THIS AGREEMENT, POINT BLANK SHALL HAVE NO LIABILITY TO
SUPPLIER FOR ANY GENERAL, INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE, OR CONSEQUENTIAL DAMAGES, INCLUDING WITHOUT LIMITATION LOST PROFITS ARISING OUT OF ANY CLAIM BASED ON THIS ARTICLE 9. 
 ARTICLE 10 
 INSURANCE 
 10.1 Insurance. 
 Prior to commencing
any work in connection with the supply of Products hereunder, SUPPLIER shall secure and shall maintain during the performance of its obligations under this Agreement and throughout the Term, at least the following types of insurance and minimum
coverage: [***]. SUPPLIER shall furnish to POINT BLANK evidence of such insurance coverage in the form of Certificates of Insurance. POINT BLANK shall be named as an additional insured on SUPPLIER’s Commercial General Liability,
Automobile Liability and excess liability umbrella insurance policies. All Certificates of Insurance shall provide that POINT BLANK shall be provided thirty (30) days written notice prior to any change, substitution or cancellation of such
policies of insurance. [***]. The foregoing requirements as to the types and limits of insurance coverage to be maintained by the Parties SUPPLIER, and any 

  

 16 

 
approval or waiver of said insurance by POINT BLANK is not intended to and shall not in any way or manner limit or qualify the liabilities and obligations of
SUPPLIER pursuant to this Agreement. 
 ARTICLE 11 
 BREACH, REMEDIES AND TERMINATION 
 11.1 Breach. 
 The occurrence of any one or more of the following events shall constitute a breach and default of this Agreement: 
 (a) Failure by SUPPLIER to observe or perform any of the obligations, covenants, conditions, representations or warranties required of SUPPLIER pursuant
to this Agreement, where such failure is not remedied within thirty (30) days after receipt of a written notice thereof from POINT BLANK to SUPPLIER; or 
 (b) Failure by POINT BLANK to observe or perform any of the obligations, covenants, conditions, representations or warranties required of POINT BLANK pursuant to this Agreement, where such failure is not remedied
within thirty (30) days after receipt of a written notice thereof from SUPPLIER to POINT BLANK; 
 (c) Failure by POINT BLANK to make
any payments totaling in excess of $5,000 due from POINT BLANK to SUPPLIER as required by this Agreement and such breach continues for a period of thirty (30) days after written notice thereof from SUPPLIER; 
 (d) Failure by SUPPLIER to make any payments totaling in excess of $5,000 due from SUPPLIER to POINT BLANK as required by this Agreement and such breach
continues for a period of thirty (30) days after written notice thereof from POINT BLANK; or 
 (e) If a Party is insolvent, seeks
protection from creditors, makes a general assignment for the benefit of creditors, or if a bankruptcy receiver is appointed for its business. 
 With regard to subsections (a), (b), (c) and (d) above, such failures shall not constitute a “breach” or “default” for purposes of this Section 11.1 until the non-defaulting party provides the written
notice required thereunder in accordance with Section 14.13 (the “Notice of Default”). Such written notice, in order to be effective, shall be prominently titled “NOTICE OF DEFAULT AND RIGHT TO TERMINATE” and shall
inform the defaulting party of the action, or failure to act, causing such default and the provision of this agreement which has been breached. 
 11.2 Force Majeure. 
 Each Party shall be excused from performance under this Agreement while and to the extent that it is
unable to perform, for a cause beyond its reasonable control. Force majeure shall not include any failure resulting from poor maintenance of the Plant, SUPPLIER’s mechanical failure or failures or work stoppages. In the event either Party is
rendered unable wholly or in part by force majeure to carry out its obligations under this Agreement, then the Party affected 

  

 17 

 
by force majeure shall give written notice with explanation to the other Party immediately. Following such notice, the affected obligations of the Party
giving notice shall be suspended only during the continuance of the events giving rise to the force majeure provided that the affected Party is acting with due diligence to remedy the events giving rise to the force majeure. Notwithstanding the
foregoing, however, if SUPPLIER is unable to perform for a period of more than ninety (90) days due to any delay, POINT BLANK may terminate this Agreement. 
 11.3 Remedies. 
 (a) In addition to any remedies available to POINT BLANK under law or as provided
herein, SUPPLIER shall implement overtime, dedicated shipping and additional personnel to avoid any delay in delivery or Defective Products (as defined in Section 5.3). However, in the event there are delayed or Defective Products (which have
been acknowledged as Defective by SUPPLIER or found Defective by the Independent Laboratory pursuant to the procedure contained in Section 5.3), POINT BLANK shall be entitled to exercise the following remedies: Any Products not delivered to
POINT BLANK in accordance with this Agreement or the Specifications set forth in Exhibit A attached hereto, as it may be amended from time to time, may, at POINT BLANK’s sole option: 1) be accepted as is, with an equitable adjustment in
price; 2) be corrected by POINT BLANK or another party under POINT BLANK’s direction at SUPPLIER’s expense; 3) be corrected by SUPPLIER at SUPPLIER’s expense; or 4) reject and returned to SUPPLIER without charge to POINT BLANK and
with SUPPLIER paying all applicable freight charges; provided, however, POINT BLANK shall give SUPPLIER at least 24 hours advance notice of its intention to return any Products. 
 (b) In the event of a breach by SUPPLIER, POINT BLANK shall have, in addition to any applicable right to terminate this Agreement pursuant to subsection
11.4, and any other remedies specified herein or available at law or equity, the following remedies: 
 (i) The right to withhold all or part
of any remaining payments for Defective Product until such breach is cured to POINT BLANK’s reasonable satisfaction; and 
 (ii) The
right to contract with an Alternative Supplier. In such case, SUPPLIER shall be liable to POINT BLANK for all additional costs incurred by POINT BLANK to complete the work or procure the Products, but no other damages or injury caused by
SUPPLIER’s breach. 
 11.4 Termination. 
 Except as otherwise provided herein, this Agreement may be terminated only under the following circumstances: 
 (a) By POINT BLANK, if SUPPLIER has committed a material breach of its obligations, covenants, conditions, representations or warranties pursuant to this Agreement, and such failure is not remedied within thirty (30) days after receipt
of a written notice thereof from POINT BLANK to SUPPLIER (unless cure of such material breach, by its nature, cannot be cured in such a 30-day period, in which case cure must occur as soon as possible after the end of such 30-day period, but in no
event longer than sixty (60) days), which notice will advise SUPPLIER of the intention of POINT BLANK to terminate the Agreement unless the breach is cured. 
  

 18 

 (b) By SUPPLIER, if POINT BLANK has committed a material breach of its obligations, covenants,
conditions, representations or warranties pursuant to this Agreement, and such failure is not remedied within thirty (30) days after receipt of a written notice thereof from SUPPLIER to POINT BLANK (unless cure of such material breach, by its
nature, cannot be cured in such a 30-day period, in which case cure must occur as soon as possible after the end of such 30-day period, but in no event longer than sixty (60) days), which notice will advise POINT BLANK of the intention of
SUPPLIER to terminate the Agreement unless the breach is cured. If termination is without cause and not in accordance with Article 1, the Parties agree that the damages that POINT BLANK may suffer are difficult to ascertain and are not capable of a
reasonable estimation at the time of contracting. In POINT BLANK’s sole discretion, for a period not to exceed 12 months, POINT BLANK may require SUPPLIER to continue to supply Products until POINT BLANK is able to qualify an alternative
supplier. 
 For purposes of this section 11.4, a breach shall be a “material breach” if the non-breaching party determines in its reasonable
commercial discretion that such breach (or series of breaches) is material, including, by way of example and not limitation, a breach (or series of breaches) that (i) causes the non-breaching party to incur costs, fees or penalties in excess of
[***], (ii) causes the non-breaching party to fail to materially fulfill a material obligation to a third party, or (iii) causes the non-breaching party to forgo reasonably certain sales of its products or services with a projected
sale price in excess of [***]. 
 11.5 Effects of Termination. 
 Upon termination, SUPPLIER shall, unless the notice directs otherwise, immediately discontinue all work relating to the manufacture and delivery of the
Products and make all Raw Materials delivered, or caused to be delivered, by POINT BLANK available for pick-up by POINT BLANK within forty-eight hours of termination; provided that POINT BLANK shall have satisfied any remaining payment obligations
to SUPPLIER. In the event of termination by POINT BLANK hereunder, SUPPLIER shall refund to POINT BLANK the amount of any advance payment made by POINT BLANK for any performance, conduct or act to occur after the date of termination. In addition,
SUPPLIER shall pay to POINT BLANK or POINT BLANK shall pay to SUPPLIER, as applicable, amounts due under Exhibit B hereto. All final payments to SUPPLIER are contingent upon the return to POINT BLANK or its designee of any information and
materials required to be returned to POINT BLANK as specified herein. POINT BLANK has no obligation to pay for any finished Products at SUPPLIER’s facility as of the date of the notice to terminate, which was not previously ordered by POINT
BLANK. 
  

 19 

 ARTICLE 12 
 DISPUTE RESOLUTION PROCEDURES 
 12.1 Disputes. The Parties shall attempt in good faith to
resolve all claims, disputes and controversies of whatever nature, including in contract, tort or equity, that arise out of or relate to this Agreement or the relationship of the Parties (collectively “Dispute”) promptly by
negotiation between chief executive officers of the Parties (except that the Parties may immediately file for a preliminary injunction, temporary restraining order or other provisional relief to enforce its respective rights under this Agreement).
If the Dispute has not been resolved by negotiation within 21 (twenty-one) days of the disputing Party’s notice to the other Party of such Dispute, or if the Parties’ chief executive officers fail to meet within twenty (20) days, the
Parties shall resolve the Dispute in accordance with Section 12.2 below. 
 12.2 Arbitration. Except as provided in
Section 12.3 below, all Disputes shall be subject to arbitration if good faith negotiations among the Parties as provided in Section 12.1 above does not resolve such Dispute. Such arbitration shall proceed in accordance with the Commercial
Arbitration Rules of the American Arbitration Association, unless the parties mutually agree otherwise, and pursuant to the following procedures: 
 12.1.1 Reasonable discovery shall be allowed in arbitration. 
 12.1.2 All proceedings before the arbitrators shall be held in New
York, New York. The governing law shall be as specified in Section 14.12. 
 12.1.3 The costs and fees of the arbitration,
including attorney’s fees, shall be allocated by the arbitrators. 
 12.1.4 The award rendered by the arbitrators shall be final and
judgment may be entered in accordance with applicable law and in any court having jurisdiction thereof. 
 12.1.5 The existence and
resolution of the arbitration shall be kept confidential by the by the Parties and shall also be kept confidential by the arbitrators. 
 12.2 Equitable Relief. 
 Nothing herein shall preclude either party from seeking equitable relief to enforce the provisions
of Article 9. 
 ARTICLE 13 
 TTILE TO RAW MATERIALS 
 13.1 Title to Raw Materials and Products. 
 POINT BLANK shall at all times retain title to all POINT BLANK Raw Materials. SUPPLIER agrees that under no circumstances shall it hold itself out as
being the owner of any Raw Materials on its premises, including, without limitation, on SUPPLIER’s books and records. 
  

 20 

 13.2 UCC Filings. 
 Notwithstanding Section 13.1 hereof, the parties hereto intend to create in SUPPLIER the relationship of bailee and processor with respect to any Raw Materials in the possession of SUPPLIER and agree that
upon the request of POINT BLANK, an informational or precautionary filing shall be made pursuant to the Uniform Commercial Code in effect in each jurisdiction where any Raw Materials are being held by SUPPLIER. Following any such request, POINT
BLANK and SUPPLIER shall execute and file such instruments, including financing statements and related amendments or continuation statements, and take such other actions as may be deemed by either of them to be necessary or desirable in order to
fully protect the rights of POINT BLANK in and to the Raw Materials. Nothing in this Section 13.2 or in any instrument executed, delivered or filed pursuant hereto, and no action or omission on the part of any party hereto, shall change
the fact than the Raw Material is legally and equitably owned by POINT BLANK and is held by SUPPLIER as a bailee and processor only. SUPPLIER shall inform POINT BLANK, in writing and within thirty (30) days of becoming so aware, of any
financing statement filed by a creditor of SUPPLIER against the Raw Materials held by SUPPLIER. 
 13.3 Liens. 
 The parties understand and agree that SUPPLIER shall have a processor’s and bailee’s lien on all Product that is located at the Plant and has
been processed under this Agreement to secure the payment of any and all amounts due from POINT BLANK or any of its Affiliates hereunder; provided, however, that SUPPLIER hereby waives any lien rights it may have with respect to Products located at
the Plant until such time as it is processed under this Agreement. 
 ARTICLE 14 
 MISCELLANEOUS 
 14.1 Authority.

 Each party warrants that it has the full authority and power to enter into and perform under this Agreement and to make all
representations, warranties and grants as set forth herein. Each party represents that it is not subject to any restrictive obligations imposed by former clients or any other Person that would impair its ability to exercise its best efforts in
connection with its respective obligations to be performed pursuant to this Agreement. 
 14.2 Survivability. 
 All covenants, indemnities, guarantees, representations and warranties by SUPPLIER and any undischarged obligations of POINT BLANK arising prior to the
expiration or termination of this Agreement (whether by completion or earlier termination) shall survive such expiration or termination. 
 14.3 Enforceability. 
 Either Party’s failure in any one or more instances to insist upon strict performance of any of
the terms and conditions of this Agreement or to exercise any right herein conferred shall 

  

 21 

 
not be construed as a waiver or relinquishment of that right or of that Party’s right to assert or rely upon the terms and conditions of this Agreement.
Any express waiver of a term of this Agreement shall not be binding and effective unless made in writing and properly executed by the waiving Party. 
 14.4 Amendments. 
 This Agreement may not be amended except in writing properly executed by both
Parties. Except as specifically amended, this Agreement shall remain in full force and effect as written. 
 14.5 Assignment.

 Neither party shall have the right or power to assign its rights or delegate its obligations hereunder without the express written consent
of the other party. Any attempt to do so without such consent shall be null and void and shall permit the other party the right to cancel and terminate this Agreement. In the event this Agreement is properly assigned, the provisions of this
Agreement shall bind and benefit the Parties hereto and their representatives, successors and assigns. 
 14.6 Severability.

 Any invalid or unenforceable provision shall be deemed severed from this Agreement to the extent of its invalidity or unenforceability, and
the remainder of this Agreement shall remain in full force and effect. 
 14.7 Complete Agreement. 
 This Agreement and all exhibits thereto constitute the complete and exclusive agreement between the Parties. It supersedes all prior written and oral
statement, condition, obligation, representation or warranty. In the event of any inconsistency between this Agreement and any Exhibit, the provisions of this Agreement shall take precedence. The Parties shall not be bound by any past or future
terms, conditions, or course of conduct not set forth herein, unless set forth in writing and signed by an authorized representative of SUPPLIER and POINT BLANK. Any additional or inconsistent terms not so agreed by SUPPLIER and POINT BLANK in
writing shall be null and void. Acceptance of any purchase order, confirmation, or work order, invoice or other form of any kind shall not modify the terms of this Agreement. 
 14.8 Audit and Inspection Rights. 
 (a) Either party (the “Auditing Party”) shall have the right to examine, either directly or through its authorized representatives or agents (subject to execution by non-party employees of non-disclosure undertakings as may
be reasonably requested by the other party), during business hours and for a reasonable period of time, all books, records, accounts, correspondence, instructions, specifications, plans, drawings, receipts, manuals and memoranda of the other party
(the “Audited Party”) and its affiliates pertinent to this Agreement. SUPPLIER’s audit rights of POINT BLANK’s records shall be for the sole purpose of verifying (i) royalties payable under Section 9.2(b),
(ii) the annual needs of POINT BLANK and it Affiliates for Products manufactured with Kevlar and Twaron under Section 3.1(a) or (iii) [***]. 

  

 22 

 
The Audited Party will cooperate with the auditor. The Auditing Party will bear the costs of the audit, unless the audit shows that the Audited Party or any
of its affiliates did not comply with this its obligations under this agreement, in which case the Audited Party shall bear the cost of the audit. 
 (b) POINT BLANK may, at its option, inspect and test any Products at any time and place to the extent practicable, including during the period of manufacture and prior to delivery. SUPPLIER agrees to permit reasonable access to its
facilities or the facilities of any subcontractor during normal business hours for such inspections and tests; provided, however, that POINT BLANK shall not materially interfere with the operations of SUPPLIER during the course of any such
inspections or tests. 
 14.9 Counterparts. 
 This Agreement may be executed simultaneously in two or more counterparts which, when taken together, shall be deemed an original and constitute one and the same document. The signature of any Party to the counterpart
shall be deemed a signature to the Agreement, and may be appended to, any other counterpart. Facsimile transmission of executed signature pages shall be sufficient to bind the executing Party. 
 14.10 Headings. 
 The headings to the
various sections and paragraphs of this Agreement are solely for the convenience of the Parties, are not part of the Agreement and shall not be used for the interpretation of the validity of the Agreement or any provision hereof. 
 14.11 Indemnification and Defense. (a) Without limiting the obligations set forth above and as a separate obligation under this Agreement,
SUPPLIER agrees to indemnify POINT BLANK for any third party claims which may be brought against POINT BLANK arising out of or in connection with any breach by SUPPLIER of its warranties, representations or obligations under this Agreement.

 (b) Without limiting the obligations set forth above and as a separate obligation under this Agreement, POINT BLANK agrees to indemnify
SUPPLIER for any third party claims which may be brought against SUPPLIER arising out of or in connection with any breach by POINT BLANK of its warranties, representation or obligations under this Agreement. 
 (c) If any third Person shall make a claim or commence an action against POINT BLANK or SUPPLIER, as the case may be (an “Indemnified
Party”) with respect to any matter (a “Third Party Action”) which may give rise to a claim for indemnification under this Section 14.11, then the Indemnified Party shall notify the other Party (the
“Indemnifying Party”) in writing promptly after becoming aware of such Third Party Action describing in reasonable detail the Third Party Action (such notice being hereinafter called a “Third Party Action Notice”),
which notice shall include an estimate of the damages, if known, the method of computation thereof, and a reference to the specific provisions of this Agreement in respect of which it seeks indemnification. It is agreed that a delay on the part of
any Indemnified Party in notifying the Indemnifying Party hereunder for a period of up to 90 days shall not relieve the Indemnifying Party of its obligations hereunder, except to the extent the Indemnifying Party is 

  

 23 

 
prejudiced by such failure to give notice. The Indemnifying Party will have ten (10) days from the delivery of such Third Party Action Notice, to
determine whether or not (i) the Indemnifying Party will, at its sole cost and expense, defend against such Third Party Action and/or (ii) the Indemnifying Party is disputing the claim for indemnity hereunder. 
 (d) If the Indemnifying Party (i) does not respond to the Third Party Action Notice by the close of business on the last day of the ten
(10) day period set forth in subparagraph (c) above, or (ii) responds to the Third Party Action Notice, but disputes the claim for indemnity hereunder and elects not to assume the defense, the Indemnified Party shall have the
right to defend against any such Third Party Action by appropriate proceedings or to settle or pay any such Third Party Action for such an amount as the Indemnified Party shall deem appropriate and the Indemnifying Party shall promptly pay all costs
and damages resulting from such Third Party Action in accordance with subparagraph (e) below; provided that in the case of clause (ii), any right of the Indemnified Party to recover from the Indemnifying Party shall depend on the resolution of
the dispute as to the right of indemnity. 
 (e) If the Indemnifying Party affirmatively disputes the right to indemnity, but nevertheless
elects to defend against any such Third Party Action or settle or pay any such Third Party Action, any right of the Indemnified Party to recover from the Indemnifying Party shall depend on the resolution of the dispute as to the right of indemnity.

 (f) Notwithstanding anything herein to the contrary, if the Indemnifying Party notifies the Indemnified Party that it will defend against
or settle any Third Party Action: 
 (i) such defense or settlement shall be at the sole cost and expense of the Indemnifying Party, except
for costs and expenses of the Indemnified Party’s counsel, if any, pursuant to items (v) and (vi) below; 
 (ii) the
Indemnifying Party and its counsel shall conduct such defense or settlement at all times in good faith; 
 (iii) the Indemnifying Party and
its counsel shall, at the reasonable request of the Indemnified Party, provide periodic updates to the Indemnified Party in order to keep the Indemnified Party informed as to its conduct of such defense or settlement, and shall not compromise or
settle such Third Party Action without the prior written consent of the Indemnified Party (not to be unreasonably withheld or delayed); unless such settlement or compromise (i) includes a complete, unconditional release of the Indemnified Party
from all liability with respect to such Third Party Action; (ii) could not reasonably be expected to lead to liability or create any financial or other obligation on the part of the Indemnified Party for which the Indemnified Party is not
entitled to indemnification hereunder; (iii) would not require the Indemnified Party to change in any material respect the way it conducts business; and (iv) would not require any admission of wrongdoing by the Indemnified Party;

 (iv) the Indemnified Party shall reasonably cooperate with the Indemnifying Party, including making available to the Indemnifying Party,
all relevant witnesses and pertinent documents and information and appropriate personnel; 
 (v) the Indemnified Party may elect to employ
its own counsel and participate in such defense or settlement at the Indemnified Party’s sole cost and expense, but the control of such defense and the settlement shall rest with the Indemnifying Party; 
  

 24 

 (vi) notwithstanding the Indemnifying Party’s election to defend against or settle the Third Party
Action, the Indemnified Party may, upon written notice to the Indemnifying Party, elect to employ its own counsel (who shall be reasonably acceptable to the Indemnifying Party) at the Indemnifying Party’s expense (except that the Indemnifying
Party shall not be obligated to pay the fees of more than one separate counsel for all Indemnified Parties, taken together) if (A) the Indemnifying Party is also a Person against whom the Third Party Action is made and the Indemnified Party has
been advised by counsel that (x) representation of both parties by the same counsel would be inappropriate under applicable standards of professional conduct or (y) the Indemnified Party has available to it one or more defenses or
counterclaims that are inconsistent with, different from, or in addition to one or more of those that may be available to the Indemnifying Party with respect to such Third Party Action; or (B) the Indemnifying Party shall not in fact have
employed counsel reasonably satisfactory to the Indemnified Party for the defense or settlement of such Third Party Action; provided, however, that the assumption of control of the defense or settlement of a Third Party Action by the Indemnified
Party pursuant to this item (vi) shall not relieve the Indemnifying Party of its obligation to indemnify and hold the Indemnified Party harmless; and 
 (vii) in no event shall the Indemnified Party consent to the entry of any judgment or enter into any settlement with respect to such Third Party Action without the prior written consent of the Indemnifying Party
(which consent shall not be unreasonably withheld or delayed). 
 (g) Subject to the other provisions of this Section 14.11, if
the Indemnifying Party: 
 (i) does not respond to a Third Party Action Notice by close of business on the last day of the ten
(10) day period set forth in subparagraph (c) above; 
 (ii) does not elect to defend against any Third Party Action
for which it disputes the Indemnified Party’s right to indemnity, and such dispute is resolved, in accordance with this Agreement, in a manner affirming the Indemnified Party’s right to indemnity; 
 (iii) elects to defend against any Third Party Action for which it does not dispute the Indemnified Party’s right to indemnity hereunder; or

 (iv) elects to defend against any Third Party Action for which it does dispute the right to indemnity, to the extent the dispute is
resolved in a manner affirming the Indemnified Party’s right to indemnity; then: 
 the Damages resulting from the settlement or the adjudication of such
Third Party Action, or that portion thereof as to which the defense is unsuccessful, shall promptly be paid by the Indemnifying Party to the Indemnified Party. 
 14.12 Governing Law; Jurisdiction. This Agreement shall be governed in all respects by the laws of New York without regard to provisions regarding choice of laws. The parties 

  

 25 

 
agree to submit to the exclusive jurisdiction and venue of the United States Federal District Court for the Southern District of New York, for purposes of
enforcing any equitable relief under Section 12.3 or any arbitration awards under Section 12.2. 
 14.13
Notice. 
 Any notice, demand, consent, election, offer, approval, request, invoice backup documentation or other communication
(collectively, a “notice”) required under or provided pursuant to this Agreement must be in writing and either delivered personally, sent by overnight delivery courier, or sent by certified or registered mail, postage prepaid, return
receipt requested to the person designated below (the “Designated Representative”). Notice shall be deemed given when received. A notice sent by facsimile will be deemed given when receipt by the receiving facsimile machine has been
confirmed. 
 A notice must be addressed as follows: 
  

			
	To SUPPLIER:	  	LifeStone Materials, LLC
		  	Temple Building
		  	99 Roush Road
		  	Anderson, South Carolina 29625
		  	Attention:
                                        
                    
		  	Telephone number:
		  	Facsimile number:
	
	With a copy, which shall not constitute notice, to:
		  	 Meitar Liquornik Geva & Leshem Brandwein, Law Offices
 16 Abba Hillel Rd.

		  	Ramat Gan 52506, Israel
		  	Attention: Dr. Israel Leshem
		  	Telephone number: 972-3-6103100
		  	Facsimile 972-3-6103111
		
	To POINT BLANK:	  	Point Blank Solutions, Inc.
		  	2102 SW 2nd Street,
		  	Pompano Beach, Florida 33069
		  	United States of America
		  	Attention: Larry R. Ellis
		  	Telephone number: 954-630-0900
		  	Facsimile number: 954-630-0980
	
	With a copy, which shall not constitute notice, to:
		  	Venable LLP
		  	2 Hopkins Plaza, Suite 1800
		  	Baltimore, Maryland 21201
		  	United States of America
		  	Attention: Thomas D. Washburne, Jr.
		  	Telephone number: 410-244-7744
		  	Facsimile: 410-244-7742

  

 26 

 14.14 Defined Terms. Solely for convenience of reference, Exhibit D attached hereto sets
forth a list of defined terms used in this Agreement and the Article or Section hereof in which each term is defined. 
  

 27 

 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the year and day first written
above. 
  

									
	SUPPLIER:	 		 	POINT BLANK:
	LIFESTONE MATERIALS, LLC	 		 	POINT BLANK SOLUTIONS, INC.
					
	By:	 	 /s/ Craig Trask
	 		 	By:	 	 /s/ Larry R. Ellis

	Name:	 	Craig Trask	 		 	Name:	 	Larry R. Ellis
	Title:	 	Production Manager	 		 	Title:	 	Chief Executive Officer and President
	Date:	 	  
	 		 	Date:	 	  

					
	By:	 	 /s/ Julian Crawford
	 		 		 	
	Name:	 	Julian Crawford	 		 		 	
	Title:	 	Controller	 		 		 	
	Date:	 	  
	 		 		 	

 {Signature Page to Supply Agreement} 

 EXHIBIT A 
 [***] 

 EXHIBIT B 
 [***] 

 EXHIBIT C 
 [***] 

 EXHIBIT D 
 (Index of Defined Terms) 
  

				
	 Term
	  	Article/Section	 
	 Affiliate
	  	Art. I	 
	 Agreement
	  	Preamble	 
	 Alternate Supplier
	  	5.4	 
	 Alternate Supply Period
	  	5.4	 
	 Audited Party
	  	14.8	(a)
	 Auditing Party
	  	14.8	(a)
	 Capital Investment Loan
	  	2.2	(b)
	 Carry-Over Grace Period
	  	3.1	(a)
	 Child
	  	8.4	 
	 Contract Price
	  	6.1	 
	 Defective
	  	5.3	 
	 Derivative Work
	  	9.1	(e)
	 Designated Manufacturer
	  	2.4	(a)
	 Designated Representative
	  	14.13	 
	 DFARS
	  	8.1	(b)
	 Dispute
	  	12.1	 
	 Dollars
	  	6.4	(b)
	 Effective Date
	  	Preamble	 
	 Extended Term
	  	Art. I	 
	 FAR
	  	8.1	(b)
	 Final Year
	  	3.1	(a)
	 Improvements
	  	9.1	(d)
	 Indemnified Party
	  	14.11	(c)
	 Indemnifying Party
	  	14.11	(c)
	 Independent Laboratory
	  	5.3	 
	 Initial Term
	  	Art. I	 
	 Intellectual Property
	  	9.1	(b)
	 [***]
	  	9.2	(b)
	 Licensed Intellectual Property
	  	9.1	(f)
	 LLC Agreement
	  	2.2	(b)
	 Maximum Monthly Capacity
	  	3.1	(a)
	 Minimum Inventory
	  	3.4	 
	 Minimum Order
	  	3.1	(a)
	 Notice of Default
	  	11.1	 
	 Notice of Defect
	  	5.3	 
	 Parties
	  	Preamble	 
	 PB Indemnified Party
	  	9.6	 
	 PB Indemnifying Party
	  	9.7	 
	 Person
	  	Art. I	 
	 Plant
	  	2.2	 

				
	 POINT BLANK
	  	Preamble	 
	 POINT BLANK (purposes of Article 9 only)
	  	9.1	(a)
	 POINT BLANK Action
	  	9.6	 
	 POINT BLANK Business
	  	2.2	(b)
	 POINT BLANK License
	  	9.2	(a)
	 Prime
	  	2.2	(b)
	 Products
	  	2.1	 
	 Rejected Goods
	  	3.6	 
	 Replacement Products
	  	5.4	 
	 Revised Product
	  	2.2	(a)
	 Specifications
	  	2.1	 
	 Start Date
	  	3.1	(a)
	 Sublicensee
	  	9.2	(a)
	 SUPPLIER
	  	Preamble	 
	 SUPPLIER (purposes of Article 9 only)
	  	9.1	(c)
	 SUPPLIER Action
	  	9.7	 
	 Term
	  	Art. I	 
	 Third Party Action Notice
	  	14.11	(c)
	 Volume Forecast
	  	3.3Redacted Supply Agreement

 Exhibit 10.3 
  

	***	TEXT OMITTED AND FILED SEPARATELY, CONFIDENTIAL TREATMENT REQUESTED UNDER 17 C.F.R. SECTIONS 200.80(b)(4) AND 240.24b-2 

 LIMITED LIABILITY COMPANY AGREEMENT 
 OF 
 LIFESTONE MATERIALS, LLC 
 March 18, 2008 

 TABLE OF CONTENTS 
  

					
	 	  	Page
	ARTICLE I	 	– CERTAIN DEFINITIONS	  	1
			
	ARTICLE II	 	– RECITALS; FORMATION; NAME; PLACE OF BUSINESS	  	1
	 2.01
	 	Recitals	  	1
	 2.02
	 	Formation of Company; Certificate of Formation	  	1
	 2.03
	 	Name of Company	  	2
	 2.04
	 	Place of Business	  	2
	 2.05
	 	Registered Office and Registered Agent	  	3
			
	ARTICLE III	 	– PURPOSES AND POWERS OF COMPANY	  	3
	 3.01
	 	Purposes	  	3
	 3.02
	 	Powers	  	3
			
	ARTICLE IV	 	– TERM OF COMPANY	  	3
			
	ARTICLE V	 	– CAPITAL	  	4
	 5.01
	 	Initial Capital Contributions of the Members	  	4
	 5.02
	 	Capital Commitments	  	4
	 5.03
	 	Additional Capital Contributions of the Members	  	5
	 5.04
	 	Defaulting Member	  	5
	 5.05
	 	Capital Accounts	  	6
	 5.06
	 	No Interest on Capital Contributions or Capital Accounts	  	6
	 5.07
	 	Advances to Company	  	6
	 5.08
	 	Liability of Members and the Board of Managers	  	8
	 5.09
	 	Return of Capital	  	8
			
	ARTICLE VI	 	– ALLOCATION OF PROFITS AND LOSSES; DISTRIBUTIONS; TAXES	  	8
	 6.01
	 	Allocation of Net Income or Net Loss	  	8
	 6.02
	 	Allocation of Income and Loss With Respect to Company Interests Transferred	  	8
	 6.03
	 	Distributions	  	8
	 6.04
	 	Taxes	  	9
			
	ARTICLE VII	 	– MANAGEMENT	  	11
	 7.01
	 	Management of the Company by the Board of Managers	  	11
	 7.02
	 	Officers	  	17
	 7.03
	 	Other Activities of Members or Affiliates; Restrictions on Competition	  	17
	 7.04
	 	Indemnification of the Members, Managers, Officers and any Affiliate	  	18
			
	ARTICLE VIII	 	– DEADLOCK	  	19
	 8.01
	 	Deadlock	  	19

					
	ARTICLE IX	 	– BANK ACCOUNTS; BOOKS AND RECORDS; STATEMENTS; TAXES, FISCAL YEAR	  	21
	 9.01
	 	Bank Accounts	  	21
	 9.02
	 	Books and Records	  	21
	 9.03
	 	Financial Statements and Information	  	21
	 9.04
	 	Accounting Decisions	  	22
	 9.05
	 	Where Maintained	  	22
	 9.06
	 	Fiscal Year	  	22
			
	ARTICLE X	 	– TRANSFERS AND CONVERSION OF COMPANY INTERESTS AND THE ADDITION, SUBSTITUTION AND WITHDRAWAL OF MEMBERS	  	22
	 10.01
	 	Transfer of Company Interests	  	22
	 10.02
	 	Restrictions on Transfers	  	23
	 10.03
	 	Rights of First Refusal	  	24
	 10.04
	 	Bankruptcy, Dissolution or Liquidation of a Member	  	25
	 10.05
	 	Call Right	  	26
	 10.06
	 	No Right to Withdraw	  	28
			
	ARTICLE XI	 	– DISSOLUTION AND LIQUIDATION	  	28
	 11.01
	 	Events Causing Dissolution	  	28
	 11.02
	 	Cancellation of Certificate	  	30
	 11.03
	 	Distributions Upon Dissolution	  	30
	 11.04
	 	Reasonable Time for Winding Up	  	30
			
	ARTICLE XII	 	– STANDSTILL AGREEMENT	  	30
	 12.01
	 	Standstill	  	30
	 12.02
	 	Restricted Period	  	31
			
	ARTICLE XIII	 	– REPRESENTATIONS AND WARRANTIES	  	32
	 13.01
	 	Representations and Warranties of FMSS	  	32
	 13.02
	 	Representations and Warranties of PBSS	  	33
			
	ARTICLE XIV	 	– MISCELLANEOUS PROVISIONS	  	35
	 14.01
	 	Compliance with Delaware LLC Act	  	35
	 14.02
	 	Additional Actions and Documents	  	35
	 14.03
	 	Notices	  	35
	 14.04
	 	Severability	  	36
	 14.05
	 	Survival	  	37
	 14.06
	 	Waivers	  	37
	 14.07
	 	Exercise of Rights	  	37
	 14.08
	 	Binding Effect	  	37
	 14.09
	 	Limitation on Benefits of this Agreement	  	37
	 14.10
	 	Amendment Procedure	  	37
	 14.11
	 	Entire Agreement	  	38
	 14.12
	 	Pronouns	  	38
	 14.13
	 	Headings	  	38
	 14.14
	 	Governing Law; Jurisdiction	  	38

  

 -ii- 

					
	 14.15
	 	Execution in Counterparts	  	38
	 14.16
	 	Announcements	  	38
	 14.17
	 	Arbitration	  	39
	 14.18
	 	Weaving For FMS	  	39

  

 -iii- 

 LIMITED LIABILITY COMPANY AGREEMENT 
 OF 
 LIFESTONE MATERIALS, LLC 
 THIS LIMITED LIABILITY COMPANY AGREEMENT (“Agreement”) is entered into as of March 18, 2008, (the “Effective Date”) by
and among PBSS, LLC, a Delaware limited liability company (“PBSS”) and FMS Technologies LLC, a South Carolina limited liability company (“FMSS”). PBSS and FMSS and any other persons or entities who shall in the
future execute and deliver this Agreement pursuant to the provisions hereof shall hereinafter collectively be referred to as the “Members.” 
 PBSS and FMSS agree to form a joint venture to engage in the business of designing, developing, manufacturing, and selling woven fabric (excluding unidirectional fabric) for use in soft body armor and subject to the
unanimous written consent of the Members also in other applications (the “Business”). PBSS and FMSS further agree that the joint venture take the form of a limited liability company organized pursuant to the provisions of the
Delaware Limited Liability Company Act (the “Delaware LLC Act”) under the name “LifeStone Materials, LLC” or any other name mutually agreed by all of the Members (the “Company”). 
 NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the Members hereby agree as follows: 
 ARTICLE I 
 CERTAIN DEFINITIONS 

 Unless the context otherwise specifies or requires, capitalized terms used herein shall have the respective meanings assigned thereto in
Addendum A, attached hereto and incorporated herein by reference, for all purposes of this Agreement (such definitions to be equally applicable to both the singular and the plural forms of the terms defined). Unless otherwise specified, all
references herein to Articles or Sections are to Articles or Sections of this Agreement. 
 ARTICLE II 
 RECITALS; FORMATION; NAME; PLACE OF BUSINESS 
 2.01
Recitals 
 The above recitals and statements are hereby made a part of this Agreement. 
 2.02 Formation of Company; Certificate of Formation 
 The Members of the Company hereby: 
 (a) authorize the formation of the Company by the Members as a limited liability company under
and pursuant to the Delaware LLC Act, and further authorize the filing of the Certificate with the Recording Office as required under the Delaware LLC Act; 

 (b) confirm and agree to their status as Members of the Company; 
 (c) execute this Agreement for the purpose of confirming the existence of the Company as a joint venture and establishing the rights, duties and
relationship of the Members; and 
 (d) (i) agree that if the laws of any jurisdiction in which the Company transacts business so require,
the Board of Managers also shall file, with the appropriate office in that jurisdiction, any documents necessary for the Company to qualify to transact business under such laws; and (ii) agree to execute, acknowledge, and cause to be filed, in
the place or places and manner prescribed by law, any amendments to the Certificate as may be required, either by the Delaware LLC Act, by the laws of any jurisdiction in which the Company transacts business or by this Agreement, to reflect changes
in the information contained therein or otherwise to comply with the requirements of law for the continuation, preservation, and operation of the Company as a limited liability company under the Delaware LLC Act. 
 2.03 Name of Company 
 The name under which the
Company shall conduct its business is “LIFESTONE MATERIALS, LLC.” The business of the Company may be conducted under any other name permitted by the Delaware LLC Act that is selected by the Board of Managers, in its sole and absolute
discretion. The Board of Managers promptly shall execute, file, and record any assumed or fictitious name certificates required by the laws of the State of Delaware or any state in which the Company conducts business. 
 2.04 Place of Business 
 The location of the principal
place of business of the Company shall be in Anderson, South Carolina. The Board of Managers may change the principal place of business of the Company to such other place or places within the United States of America as the Board of Managers may
from time to time determine, in its sole and absolute discretion, provided that the Board of Managers shall give written notice of the change to the Members within thirty (30) days after the effective date of the change and, if necessary, the
Board of Managers shall amend the Certificate in accordance with the applicable requirements of the Delaware LLC Act. The Board of Managers may, in its sole and absolute discretion, establish and maintain such other offices and additional places of
business of the Company, either within or without the State of Delaware, as it deems appropriate. 
  

 -2- 

 2.05 Registered Office and Registered Agent 
 The street address of the initial registered office of the Company shall be 160 Greentree Drive, Suite 101, Dover, Delaware 19904, and the Company’s
registered agent at such address shall be National Registered Agents, Inc. 
 ARTICLE III 
 PURPOSES AND POWERS OF COMPANY 
 3.01 Purposes 

 The purposes of the Company shall be: 
 (a) to engage in the business of designing, developing, manufacturing and selling woven fabric (excluding unidirectional fabric) for use in soft body armor and subject to the unanimous written consent of the Members also in other
applications; 
 (b) to acquire, hold, own, operate, manage, finance, encumber, sell, or otherwise dispose of and otherwise use the Company
Assets; and 
 (c) to enter into any lawful transaction and engage in any lawful activities in furtherance of the foregoing purposes and as
may be necessary, incidental or convenient to carry out the business of the Company as contemplated by this Agreement. 
 3.02 Powers 
 The Company shall have the power to do any and all acts and things necessary, appropriate, advisable, or convenient for the furtherance and accomplishment
of the purposes of the Company, including, without limitation, to engage in any kind of activity and to enter into and perform obligations of any kind necessary to or in connection with, or incidental to, the accomplishment of the purposes of the
Company, so long as said activities and obligations may be lawfully engaged in or performed by a limited liability company under the Delaware LLC Act. 
 ARTICLE IV 
 TERM OF COMPANY 
 The Company is a separate legal entity whose existence commenced upon the filing of the Certificate and will continue until dissolution and termination
of the Company and cancellation of the Certificate at the time and in the manner prescribed by Section 18-801 of the Act or as prescribed in Article XI hereof. 
  

 -3- 

 ARTICLE V 
 CAPITAL 
 5.01 Initial Capital Contributions of the Members 
 (a) FMSS Initial Capital Contribution. Concurrently with the execution of this Agreement, FMSS shall contribute an amount in Cash equal to
Two-Hundred-Fifty Thousand Dollars ($250,000) to the Company by immediately available wire transfer payable to the order of the Company or its designated agent to be used for the commencement of operations of the Company (the “FMSS Initial
Cash Contribution”); and 
 (b) PBSS Initial Capital Contribution. Concurrently with the execution of this Agreement, PBSS
shall contribute an amount in Cash equal to Two-Hundred-Fifty Thousand Dollars ($250,000) to the Company by immediately available wire transfer payable to the order of the Company or its designated agent to be used for the commencement of operations
of the Company (the “PBSS Initial Cash Contribution”); and 
 The FMSS Initial Cash Contribution and the PBSS Initial Cash
Contribution are sometimes collectively referred to herein as the “Initial Contributions” and individually as an “Initial Contribution.” The Members shall not be required to make any Capital Contributions to the
Company other than as set forth in this Section 5.01, in Section 5.02 or 5.03. 
 5.02 Capital Commitments 

(a) General. Each Member agrees to make a Capital Contribution to the Company at any time or from time to time up to the amount of its Remaining
Capital Commitment. Such Capital Contributions shall be made in the amounts and in the manner set forth below: 
 (i) (A) at any time
prior to the one (1) year anniversary of the Effective Date, upon the determination by the Production Manager that such contribution is required by the Company in accordance with an Approved Budget, or (B) at any time, upon the agreement
of at least one of the Managers appointed by each Member, the Controller shall cause a notice (“Funding Notice”) to be delivered to the Members that Capital Contributions are to be made to the Company (a “Drawdown”)
at least seven (7) days prior to the date of such Drawdown, which Funding Notice shall be in accordance with Section 5.02(b); 
 (ii) each Member’s required Capital Contribution to the Company shall be an amount equal to the lesser of (A) such Member’s Remaining Capital Commitment and (B) such Member’s pro rata share (based on the percentage
such Member’s respective Remaining Capital Commitments constitutes at such time out of the then total aggregate Remaining Capital Commitments of all the Members to the Company) of aggregate 

  

 -4- 

 
capital commitments called for by the Funding Notice. The Remaining Capital Commitment of each Member shall be reduced by the amount of Capital Contributions
contributed by such Member; and 
 (iii) each Member shall contribute its required Capital Contribution to the Company, in cash or by wire
transfer of immediately available funds, in each case in U.S. Dollars and in the case of wire transfer, to the bank account of the Company as shall be designated in the Funding Notice for such Drawdown. 
 (b) Funding Notice. All Funding Notices shall contain statements, which specify or describe: 
 (i) the U.S. Dollar amount of such Member’s proportionate share of such Drawdown, which shall be calculated in the manner described in
Section 5.02(a); 
 (ii) the date of such Drawdown; and 
 (iii) the bank account of the Company to which such Drawdown is to be paid. 
 5.03 Additional Capital Contributions of the Members 
 Upon the written agreement of all of the
Members, the Members shall make an additional Capital Contribution (an “Additional Capital Contributions”). Any Additional Capital Contributions to the Company shall be made by the Members by immediately available wire transfer
payable to the order of the Company or its designated agent. 
 5.04 Defaulting Member 
 (a) Event of Default. The failure by a Member to make, within five (5) Business Days after the date it is due, any portion of a Capital
Contribution required to be contributed by such Member pursuant to Section 5.02 or 5.03 hereof (the “Default Amount”), shall be an “Event of Default.” Upon the occurrence of an Event of Default,
such Member shall be deemed a “Defaulting Member” and the provisions of this Section 5.04 shall apply to such Member. 
 (b) Additional Contributions by Non-Defaulting Member. In the event that there is a Defaulting Member, any Member that has made all required Capital Contributions pursuant to Section 5.02 and 5.03 (a
“Non-Defaulting Member”) may, but shall not be required to, at its sole and absolute discretion, make a loan to the Company in exchange for a promissory note (“Additional Contribution Promissory Note”) issued by the
Company to such Non-Defaulting Member as provided below in Section 5.04(c). 
 (c) Additional Contribution Promissory
Note. Each Additional Contribution Promissory Note shall be dated as of the date the Non-Defaulting Member delivers the subject funds to the Company and shall be in an initial principal amount equal to such 

  

 -5- 

 
amount of funds delivered to the Company. The Additional Contribution Promissory Note shall be unsecured and shall be subordinate to all creditors of the
Company, provided, that such Additional Contribution Promissory Note shall be repaid to such Non-Defaulting Member by the Company prior to repayment of any other loans or advances made by the Defaulting Member to the Company. The Additional
Contribution Promissory Note shall bear interest computed daily at Prime plus twenty-five one-hundredths percent (0.25%) per annum and shall be repayable by the Company as provided in Section 6.03 below. Each Additional Contribution
Promissory Note shall mature and become due and payable on the date that the Company is dissolved pursuant to Article XI and shall be re-paid in accordance with such Article, provided that any and all amounts due thereunder shall be
paid prior to re-payment of any other loans or advances made by the Defaulting Member to the Company. 
 5.05 Capital Accounts 
 (a) A separate capital account (a “Capital Account”) shall be established and maintained for each Member. The Capital Account of each
Member shall be (i) credited with the Member’s Capital Contributions, the amount of any Company liabilities assumed by the Member (or which are secured by Company property distributed to the Member), the Member’s distributive share of
Net Income and any item in the nature of income or gain specially allocated to such Member pursuant to the provisions of Section VI (other than Section 6.04(b)(iii)); and (ii) debited with the amount of money and the fair market value
of any Company property distributed to the Member, the amount of any liabilities of the Member assumed by the Company (or which are secured by property contributed by the Member to the Company), the Member’s distributive share of Net Loss and
any item in the nature of expenses or losses specially allocated to the Member pursuant to the provisions of Section VI (other than Section 6.04(b)(iii)). 
 (b) If a Member’s interest in the Company is transferred pursuant to the terms of this Agreement, the transferee shall succeed to the Capital Account of the transferor to the extent the Capital Account is
attributable to the transferred interest. If the book value of Company property is adjusted pursuant to Section 6.04(b)(iii), the Capital Account of each Member shall be adjusted to reflect the aggregate adjustment in the same manner as if the
Company had recognized gain or loss equal to the amount of such aggregate adjustment. It is intended that the Capital Accounts of all Members shall be maintained in compliance with the provisions of Regulation Section 1.704-1(b), and all
provisions of this Agreement relating to the maintenance of Capital Accounts shall be interpreted and applied in a manner consistent with that Regulation. 
 5.06 No Interest on Capital Contributions or Capital Accounts 
 No Member shall be entitled to receive any interest on its
Capital Contributions or its outstanding Capital Account balance. 
 5.07 Advances to Company 
 (a) Initial Loans. 
 (i) FMSS
Initial Loan. Concurrently with the execution of this Agreement, FMSS shall loan an amount in Cash equal to Two Million Five-Hundred Thousand Dollars ($2,500,000) to the Company by immediately available wire transfer payable to the order of the
Company or its designated agent to be used for the operations of the Company (the “FMSS Initial Loan”). 
  

 -6- 

 (ii) PBSS Initial Loan. Concurrently with the execution of this Agreement, PBSS shall loan an
amount in Cash equal to Two Million Five-Hundred Thousand Dollars ($2,500,000) to the Company by immediately available wire transfer payable to the order of the Company or its designated agent to be used for the operations of the Company (the
“PBSS Initial Loan”). 
 The FMSS Initial Loan and the PBSS Initial Loan are sometimes collectively referred to herein as
the “Initial Loans” and individually as an “Initial Loans.” Any Initial Loans made pursuant to this Section 5.07(a) shall bear interest computed daily at Prime plus twenty-five one-hundredths percent
(0.25%) per annum and shall be repayable by the Company as provided in Section 6.03 below. 
 (b) Loans and Advances.
Except as provided for in Section 5.04 and Section 5.07(a), (c) and (d) hereof, no Member shall advance funds or make loans to the Company in excess of the amounts required hereunder to be contributed by it
to the capital of the Company without the express written consent of all the Members. Any such approved advances or loans by a Member shall not result in any increase in the amount of such Member’s Capital Account or entitle it to any increase
in its Percentage Interest. The amounts of such advances or loans shall be a debt of the Company to such Member and shall be payable or collectible only out of the Company Assets in accordance with terms and conditions agreed upon by all Members.

 (c) Capital Investment Loans. Notwithstanding the restriction on making loans and advances to the Company provided in
Section 5.07(a), each Member may provide funds to the Company in accordance with Section 2.2(b) of the Supply Agreement to fund Capital Investment Loans (as defined in Section 2.2(b) of the Supply Agreement). 
 (d) Cancellation of Member Loans. In the event that a Member sells its entire Company Interests and Percentage Interest to the other Member, any
and all outstanding Member Loans shall be cancelled and be deemed to have been repaid in full, except that if the percentage of the Member Loans of any Member constitute out of the then aggregate outstanding Member Loans amount of all Members is
greater than such Member’s Percentage Interest, then a loan amount out of such Member’s Member Loans equal to: the difference between such Member’s total Member Loans and the other Member’s total Member Loans (the
“Member’s Excess Loan Amount”) shall not be cancelled and shall be repaid by the Company to such Member upon the transfer of the Company Interest and Percentage Interest to the other Member. 
  

 -7- 

 5.08 Liability of Members and the Board of Managers 
 Except as otherwise provided in the Delaware LLC Act, the debts, obligations and liabilities of the Company, whether arising in contract, tort or
otherwise, shall be solely the debts, obligations and liabilities of the Company, and none of the Members or the Managers shall be obligated personally for any such debt, obligation or liability of the Company solely by reason of being a Member or a
Manager. The failure of the Company to observe any formalities or requirements relating to the exercise of its powers or management of its business or affairs under the Delaware LLC Act or this Agreement shall not be grounds for imposing personal
liability on the Members or the Managers for liabilities of the Company. 
 5.09 Return of Capital 
 Except upon the dissolution of the Company or as may be specifically provided in this Agreement, no Member shall have the right to demand or to receive
the return of all or any part of its Capital Account or its Capital Contributions to the Company. 
 ARTICLE VI 
 ALLOCATION OF PROFITS AND LOSSES; 
 DISTRIBUTIONS; TAXES 
 6.01 Allocation of Net Income or Net Loss 
 Except as otherwise provided in Section 6.04, the Net Income or Net Loss, other items of income, gains, losses, deductions and credits, and
the taxable income, gains, losses, deductions and credits of the Company, if any, for each Fiscal Year (or portion thereof) shall be allocated to the Members in proportion to their Percentage Interests. 
 6.02 Allocation of Income and Loss With Respect to Company Interests Transferred 
 If any Company Interest is transferred during any Fiscal Year, the Net Income or Net Loss (and other items referred to in Section 6.01) attributable to such Company Interest for such Fiscal Year shall be
allocated between the transferor and the transferee by closing the books of the Company as of the date of the transfer. 
 6.03 Distributions

 Distributions to the Members of cash held in the Company’s Bank Accounts (“Available Cash”) shall be made not
less frequently than thirty (30) days after the end of each Fiscal Quarter as follows: 
 (a) First, out of the Company’s
Available Cash, if any, to each Member, based on such Member’s pro rata share of the aggregate outstanding Capital Investment Loans, until all amounts owed to the Members in repayment of such Capital Investment Loans have been paid; 

 

 -8- 

 (b) Second, forty percent (40%) out of the remaining amount of the Company’s Available
Cash, if any pro rata to the Members in proportion to their Percentage Interests; 
 (c) Third, out of the remaining amount of the
Company’s Available Cash, if any, to each Member, based on such Member’s pro rata share of the aggregate outstanding Member Loans, until all amounts owed to the Members in repayment of such Member Loans has been paid; 
 (d) Fourth, out of the remaining amount of the Company’s Available Cash, if any, to such Members which Capital Account Percentage is higher
than their Percentage Interest in the amounts necessary to cause their Capital Account Percentages to be reduced down to their Percentage Interests; and 
 (e) Fifth, the remaining amount of the Company’s Available Cash, if any, to the Members in proportion to their Percentage Interests (collectively, “Distributions”); 
 provided, that Distributions of any amount out of the Available Cash in accordance with this Section 6.03 shall only be made to extent that a
majority of the members of the Board of Managers determine that such amount is not required for the operation of the Company for the twelve (12) months following such Distribution and for any other contingent liability that may become payable
following such twelve (12) month period, and such determination shall be based upon the approval by a majority of the members of the Board of Managers of the reasonable projections of the need for Available Cash to operate the Company during
such period. Except to the extent specifically provided otherwise herein, Distributions to Members other than as provided in this Section 6.03, shall require the prior written approval of a majority of the Board of Managers in accordance
with Section 7.01(e)(xxii). 
 6.04 Taxes 
 (a) Reports. As soon as practicable after the end of each Fiscal Year, the Company shall prepare and mail to each Member a report containing all information necessary for the Member to include its share of
taxable income or loss (or items thereof) in its income tax return. 
 (b) Regulatory Allocations. 
 (i) Qualified Income Offset. No Member shall be allocated Net Loss or deductions if the allocation causes a Member to have an Adjusted Capital
Account Deficit. If a Member receives (1) an allocation of Net Loss or deduction (or item thereof) or (2) any distribution, which causes the Member to have an Adjusted Capital Account Deficit at the end of any taxable year, then all items
of income and gain of the Company (consisting of a pro rata portion of each item of Company income, including gross 

  

 -9- 

 
income and gain) for that taxable year shall be allocated to that Member, before any other allocation is made of Company items for that taxable year, in the
amount and in proportions required to eliminate the deficit as quickly as possible. This Section 6.04(b)(i) is intended to comply with, and shall be interpreted consistently with, the “qualified income offset” provisions of the
Regulations promulgated under Code Section 704(b). 
 (ii) Minimum Gain Chargeback. Except as set forth in Regulation
Section 1.704-2(f)(2), (3) and (4), if, during any taxable year, there is a net decrease in Minimum Gain, each Member, prior to any other allocation pursuant to this Article VI, shall be specially allocated items of gross income and gain
for such taxable year (and, if necessary, subsequent taxable years) in an amount equal to that Member’s share of the net decrease of Minimum Gain, computed in accordance with Regulation Section 1.704-2(g). Allocations of gross income and
gain pursuant to this Section 6.04(b)(ii) shall be made first from gain recognized from the disposition of Company assets subject to Nonrecourse Liabilities (within the meaning of the Regulations promulgated under Code Section 752), to the
extent of the Minimum Gain attributable to those assets, and thereafter, from a pro rata portion of the Company’s other items of income and gain for the taxable year. It is the intent of the parties hereto that any allocation pursuant to this
Section 6.04(b)(ii) shall constitute a “minimum gain chargeback” under Regulation Section 1.704-2(f). 
 (iii)
Contributed Property and Book-Ups. In accordance with Code Section 704(c) and the Regulations thereunder, as well as Regulation Section 1.704-1(b)(2)(iv)(d)(3), income, gain, loss, and deduction with respect to any property
contributed (or deemed contributed) to the Company shall, solely for tax purposes, be allocated among the Members so as to take account of any variation between the adjusted basis of the property to the Company for federal income tax purposes and
its fair market value at the date of contribution (or deemed contribution). If the adjusted book value of any Company asset is adjusted as provided herein, subsequent allocations of income, gain, loss, and deduction with respect to the asset shall
take account of any variation between the adjusted basis of the asset for federal income tax purposes and its adjusted book value in the manner required under Code Section 704(c) and the Regulations thereunder. 
 (iv) Code Section 754 Adjustment. To the extent an adjustment to the tax basis of any Company asset pursuant to Code Section 734(b) is
required, pursuant to Regulation Section 1.704-1(b)(2)(iv)(m), to be taken into account in determining Capital Accounts, the amount of the adjustment to the Capital Accounts shall be treated as an item of gain (if the adjustment increases the
basis of the asset) or loss (if the adjustment decreases basis), and the gain or loss shall be specially allocated to the Members in a manner consistent with the manner in which their Capital Accounts are required to be adjusted pursuant to that
Section of the Regulations. 
 (v) Nonrecourse Deductions. Nonrecourse Deductions for a taxable year or other period shall be
specially allocated among the Members in proportion to their Percentage Interests. 
  

 -10- 

 (vi) Member Loan Nonrecourse Deductions. Any Member Loan Nonrecourse Deduction for any taxable
year or other period shall be specially allocated to the Member who bears the risk of loss with respect to the loan to which the Member Loan Nonrecourse Deduction is attributable in accordance with Regulation Section 1.704-2(b). 
 (c) Tax Matters Partner. The “Tax Matters Partner” of the Company shall be PBSS, unless otherwise designated by the Members. The Tax
Matters Partner shall not extend the statute of limitations on behalf of the Company, submit any written material to any taxing authority, settle or offer to settle any controversy, select the Company’s choice of litigation forum in a tax
controversy, or take any other action in its capacity as Tax Matters Partner without the consent of the Board of Managers. The Tax Matters Partner shall keep the Board of Managers fully advised of the progress of any audit and shall supply the Board
of Managers with copies of any written communications received from the Internal Revenue Service or other taxing authority relating to any audit within ten (10) days of receipt thereof, and shall at least ten (10) business days prior to
submitting any materials to the Internal Revenue Service, or other taxing authority, provide such materials to the Board of Managers. The Tax Matters Partner shall be reimbursed by the Company for any reasonable expenses incurred in its capacity as
Tax Matters Partner. 
 (d) Modifications. If the Board of Managers determines that any of the provisions of this
Section 6.04 do not comply with the rules of Treas. Reg. § l.704-1(b)(3) for allocating income, gain, loss, and deductions of the Company in accordance with the Members’ interests in the Company, the Board of Managers may make
any modifications required to cause such provisions to comply with such rules. 
 (e) Withholding. All amounts required to be withheld
pursuant to Section 1446 of the Code or any other provision of United States federal, state, or local tax law shall be treated as amounts actually distributed to the affected Members pursuant to this Article VI for all purposes under this
Agreement or, upon approval by a majority of the Managers, to the extent such withholding has not reduced the amounts actually distributed to an affected Member, as a demand loan to such Member, which demand loan shall bear interest at a rate of
10% per annum for all purposes of this Agreement. 
 ARTICLE VII 
 MANAGEMENT 
 7.01 Management of the Company by the Board of Managers 
 (a) Management by the Board of Managers. The Members hereby unanimously agree that the responsibility for management of the business and affairs of
the Company shall be delegated to a board of managers pursuant to Section 18-402 of the Delaware LLC Act (the “Board of Managers”), subject to the limitations set forth in this Section 7.01. 
 (b) Composition of Board Managers: Appointment and Removal 
 (i) The Board of Managers shall at all times be composed of four (4) Managers (each, a “Manager”), who initially shall be Larry Ellis, John Siemer, Daniel Blum and Avi Blum. 
  

 -11- 

 (ii) Each Member shall appoint two individuals to serve as its initial representatives on the Board of
Managers. Any Manager may be removed with or without cause by the Member who appointed such Manager. Upon the resignation, retirement, death or removal of any Manager, the Member who appointed such Manager shall designate the replacement Manager.

 (c) Meetings and Actions 
 (i) The Board of Managers shall meet (w) at least once a month in the first three month period after the Effective Date and thereafter at least once every three months, at the principal offices of the Company or at such other place as
may be agreed upon from time to time by the Board of Managers (unless such meeting shall be waived by all of the Managers); (x) at such other times as may be determined by the unanimous agreement of the Board of Managers; (y) upon the
request of at least two Managers upon ten (10) days’ notice to all Managers; or (z) in accordance with Section 8.01. Meetings may be held by telephone if at least two Managers so request upon five (5) days’
written notice to all Managers, with a copy to each Member. 
 (ii) No action may be taken at a meeting of the Board of Managers unless a
quorum consisting of at least one Manager appointed by each Member is present. 
 (iii) Each Manager shall be entitled to cast one vote with
respect to any decision made by the Board of Managers, except with respect to a determination to seek indemnification pursuant to Section 7.05 hereof, in which event a Manager seeking indemnification hereunder shall have no vote with
respect to his indemnification. Any action to be taken by the Board of Managers shall require at least three affirmative votes, except that (a) any determination to grant indemnification to a Manager pursuant to Section 7.05 hereof
shall only require two (2) affirmative votes, and (b) any action to be taken by the Board of Managers in connection with any dispute between the Company and one of the Members or any of its Affiliates (the “Member
Dispute”) shall only require the affirmative vote of one of the Managers appointed by the other Member; provided that, prior to calling a meeting of the Managers to consider such Member Dispute, the parties shall attempt in good faith to
resolve the Member Dispute promptly by negotiation between the chief executive officers of each Member, but if such Member Dispute has not been resolved by negotiation between the chief executive officers of each Member within forty-five
(45) days of delivery of notice from the Member proposing the action to the other Member or if the Member’s chief executive officers fail to meet within twenty (20) days of delivery of such notice, then a meeting of the Board of
Managers to take such action against a Member may be called, but shall not happen without 10 days prior written notice to each of the Managers (the “Meeting Notice”). Approval or action by the Board of Managers shall constitute
approval or action by the Company and shall be binding on the Members. A Manager may grant a proxy entitling the other Manager appointed by the same Member to exercise his voting rights. Such proxy shall be in 

  

 -12- 

 
writing and shall specify a termination date. The Managers appointed by the other Member shall be entitled to inspect the proxy on demand. In the event that
the pursuit of an action to resolve a Member Dispute is approved only by Managers appointed by the Member proposing to pursue such action (the “Acting Member”), the Acting Member shall be responsible for paying the Company’s
expenses and fees to pursue a resolution of such Member Dispute, provided that if the Company is successful in obtaining a final judgment or order resolving such Member Dispute in favor of the Company, the non-Acting Member shall reimburse such
Acting Member for all direct expenses and fees incurred by such Acting Member in connection with the pursuit of such action. 
 (iv) Any
action to be taken by the Board of Managers may be taken without a meeting if consents in writing setting forth the action so taken are signed by at least three Managers. 
 (v) Unless otherwise agreed upon by three or more of the Managers, at each meeting of the Board of Managers, the Production Manager and Controller shall report to the Board of Managers regarding the activities,
strategies and plans of the Company and any other items about which a Manager requests information or a report. 
 (d) Subcommittees.
The Board of Managers may designate a subcommittee consisting of at least one Manager appointed by each Member. Any subcommittee, to the extent provided by the Board of Managers, shall have and may exercise all the power and authority of the Board
of Managers. Any action to be taken by a subcommittee shall require the affirmative votes of at least one Manager appointed by each Member 
 (e) Power and Authority of the Board of Managers. The Board of Managers (acting on behalf of the Company), by its own action, or by a subcommittee of the Board of Managers, but not by delegation to officers or other employees of the
Company, shall have the right, power and authority to take the following actions, and no such action will be taken without the prior approval of the Board of Managers (unless such action has been approved by unanimous consent of the Members):

 (i) Selection, appointment, entering into any agreement with, and dismissal of the Production Manager and Controller, without derogating
from and as provided in Section 7.02; 
 (ii) The design, development, manufacture or sale by the Company of any non-woven or
unidirectional fabric; 
 (iii) The sale, of any woven fabric products for ballistic uses, which are substantially similar to or competing
with the products sold by the Company to Point Blank, (A) to any person or entity other than Point Blank, or (B) to FMS for any use other than in hard armor applications anywhere or, in soft armor application outside the United States,
provided that if Point Blank’s purchases of such products from the Company were in the then preceding [***], the Company shall take the necessary actions to use its manufacturing capacity to produce and sell any and all of its products
to third parties and the aforesaid shall not apply; It is hereby agreed by the Parties that upon FMSS request, 

  

 -13- 

 
the Company shall use its manufacturing capacity in excess of the capacity required for the supply of Point Blank’s Products (as defined in the Supply
Agreement) requirements (based on the forecasts submitted by Point Blank to the Company pursuant to the Supply Agreement) to supply FMSS’ and its Affiliates requirements of the Products and similar products for use in hard armor applications in
or out of the United States and, outside the United States, also in soft armor applications, under supply terms equivalent to the supply terms to Point Blank. 
 (iv) making overall policy decisions with respect to the business and affairs of the Company, including, but not limited to, engaging in any business other than the Business; 
 (v) annual review and approval of an annual budget and operating guidelines (the “Annual Budget,” and together with the Initial Budget,
the “Approved Budget”); The Parties agree that each proposed Annual Budget shall be presented by the Board of Managers to the Members for their review and comment not less than thirty (30) days prior to the last day of each
Fiscal Year. 
 (vi) approving any contract, agreement, commitment or expenditure not provided for in the approved annual budget with a value
in excess of [***]; 
 (vii) approval of any capital expenditure in excess of [***], whether or not such item(s) appear in the
Approved Budget; 
 (viii) approval of borrowing money, guaranteeing obligations, issuing securities, or subjecting Company assets to liens
or encumbrances, whether or not such item(s) appear in the Approved Budget; 
 (ix) approving all agreements and transactions that are
proposed to be entered into between the Company and any Member or Affiliate of a Member (other than the Asset Purchase Agreement of even date herewith among the Company and PAMAS U.S. Inc., a South Carolina corporation, the Supply Agreement, the
Non-Compete/ Non-Solicitation Agreement by and among PBSS, FMSS and the Company of even date herewith (the “Non-Compete/ Non-Solicitation”), the Indemnification Agreement by and among the Company, FMS and FMS Enterprises USA, Inc.
of even date herewith, which are hereby approved by the Members and the Indemnification Agreement by and among the PBSS, Point Blank, FMS and FMS Enterprises USA, Inc. of even date herewith, which are hereby approved by the Members); 
 (x) entering into an agreement having a term in excess of one (1) year or involving the receipt or expenditure of in excess of [***] (except
for the purchase of raw materials used in the production of the Products (as defined in the Supply Agreement), in which case the approval shall be required when entering into an agreement involving any expenditure in excess of [***]), whether
or not such item(s) appear in the Approved Budget; 
 (xi) making a decision to change the capital structure of the Company or authorizing a
Capital Contribution other than as provided for herein; 
  

 -14- 

 (xii) approval of Additional Capital Contributions; 
 (xiii) approving the transfer or sale of any assets of the Company, or any interest therein, other than in the ordinary course of business, the Fair
Market Value of which may reasonably be expected to exceed [***]; 
 (xiv) admitting a new Member to the Company (except in case of
purchase of Company Interest in compliance with the provisions of Article 10 or Sections 8.01(b) or 11.01(b)); 
 (xv) the creation of
an affiliate or subsidiary to conduct or expand a portion of the Business; 
 (xvi) except as otherwise specifically provided for herein,
taking any action not in the ordinary course of business; 
 (xvii) making significant public announcements or communicating with the media
as provided in Section 14.16, except as permitted by Section 14.16; 
 (xviii) approving any tax elections of the Company;

 (xix) approving signatory rights in the Company and approving the choice of bank depositories, and approving arrangements relating to
signatories on bank accounts; 
 (xx) approving the choice of the Company’s attorneys, independent accounts, and any other consultants,
including but not limited to market consultants, leasing agents, management agents, and advertising and public relations agents, where it is contemplated that such consultants will provide services with a value in excess of [***], or for a
period longer than six (6) months; 
 (xxi) approving any change of the Company’s fiscal year; 
 (xxii) approving all distributions to the Members (except if made pursuant to Section 6.03); 
 (xxiii) approving any amendment to an Annual Budget that on its own, or in combination with all previous amendments to such Annual Budget, exceeds ten
percent (10%) of the total approved expenses in such Annual Budget; 
 (xxiv) approving the conveyance, sale, transfer, assignment,
pledge, encumbrance, or disposal of, or the granting of a security interest in, any assets of the Company; 
 (xxv) incurring indebtedness or
loaning any sum or extending credit to any Person in an amount in excess of [***], or for a period in excess of six (6) months, that is not included in the Approved Budget; 
  

 -15- 

 (xxvi) guaranteeing any indebtedness of any other Person in any amount in excess of [***] or for a
period in excess of six (6) months, or guaranteeing any contractual obligations of any other Person with a value in excess of [***] or for a period in excess of six (6) months, that is not included in the Approved Budget;

 (xxvii) entering into any real estate lease with a value in excess of [***] or a term greater than six (6) months, or the
acquisition by the Company of any real estate that is not in the Approved Budget; 
 (xxviii) employing, appointing and removing of any
Company employee who will be involved in the day to day management of the business of the Company, and who will receive compensation in excess of [***] per year, that is not in the Approved Budget; 
 (xxix) changing any accounting principles used by the Company, except to the extent required by generally accepted accounting principles; 
 (xxx) conducting litigation to which the Company is a party; 
 (xxxi) approving the acquisition of any business or a business division from any Person, whether by asset purchase, stock purchase, merger or other business combination; 
 (xxxii) approving the merger of the Company or the sale of all or substantially all of the assets of the Company; and 
 (xxxiii) the transfer or out-licensing of Company’s Intellectual Property (other than in accordance with the Supply Agreement). 
 (f) Third Party Reliance. Third parties dealing with the Company shall be entitled to rely conclusively upon the power and authority of the Board
of Managers and the officers of the Company as set forth herein. 
 (g) Fiduciary Relationship. No Manager shall be liable to the
Company or its Members for monetary damages for breach of fiduciary duty as a Manager or otherwise liable, responsible or accountable to the Company or its Members for monetary damages or otherwise for any acts performed, or for any failure to act;
provided, however, that this provision shall not eliminate or limit the liability of a Manager (i) for any breach of the Manager’s duty of loyalty to the Company or its Members, (ii) for acts or omissions which involve intentional
misconduct or a knowing violation of law, or (iii) for any transaction from which the Manager received any improper personal benefit. 
 (h) Reimbursement. All expenses incurred with respect to the organization, operation, and management of the Company shall be borne by the Company. The Managers shall be entitled to reimbursement from the Company for direct expenses
allocable to the organization, operation, and management of the Company. None of the Managers, in their capacity as such, shall be entitled to any fees for services rendered for or on behalf of the Company. 
  

 -16- 

 (i) No Individual Authority. Except as otherwise expressly provided in this Agreement, no Member,
acting alone, shall have any obligation to act for, or undertake or assume any obligation or responsibility on behalf of, the other Member or the Company. 
 7.02 Officers 
 (a) Production Manager. The Board of Managers shall appoint a production manager (the
“Production Manager”), who shall initially be Craig Trask. Subject to the supervision and authority of the Board of Managers, the Production Manager (i) shall have responsibility and authority for management of the day-to-day
operations of the Company, (ii) may execute agreements and contracts on behalf of the Company, and (iii) may delegate matters to other Company officers and employees. Upon the decision of the Board of Managers, the Production Manager shall
be removed from office and terminated from employment with the Company. The Production Manager may be a dual employee of the Company and one of the Members or a Member’s Affiliate. 
 (b) Controller. The Board of Managers shall appoint a controller of the Company (the “Controller”), who shall initially be Julian
Crawford. Subject to the supervision and authority of the Board of Managers, the Controller shall have primary responsibility for the Company’s financial accounting systems and reporting, the preparation and filing of all tax returns for the
Company and overall management of the Company’s accounting and financial reporting system and shall perform such other duties and have such other responsibilities as may from time to time be assigned by the Board of Managers. Upon the decision
of the Board of Managers, the Controller shall be removed from office and terminated from employment with the Company. The Controller may be a dual employee of the Company and one of the Members or a Member’s Affiliate. 
 (c) Other Officers. The Board of Managers may appoint other officers of the Company (including, but not limited to, one or more vice presidents, a
treasurer, and a secretary) upon terms and conditions the Board of Managers deems necessary and appropriate. Any such officer shall hold his or her respective office unless and until such officer is removed by the Board of Managers or upon the
request of any Member. 
 7.03 Other Activities of Members or Affiliates; Restrictions on Competition 
 Except as set forth in the Non-Compete/ Non-Solicitation Agreement, any Member or any Affiliate thereof may have other business interests or may engage in
other business ventures of any nature or description whatsoever, whether currently existing or hereafter created. No Member or Affiliate thereof shall incur any liability to the Company as a result of its pursuit of such other permitted business
interests, ventures and activity, and neither the Company nor the other Members shall have any right to participate in such other business ventures or to receive or share in any income or profits derived therefrom. 
  

 -17- 

 7.04 Indemnification of the Members, Managers, Officers and any Affiliate 
 (a) Right of Indemnification. In accordance with Section 18-108 of the Delaware LLC Act, the Company shall indemnify and hold harmless any
Member, Manager, officer, and Affiliate thereof (individually, in each case, an “Indemnitee”) to the fullest extent permitted by law from and against any and all losses, claims, demands, costs, damages, liabilities joint or
several), expenses of any nature (including attorneys’ fees and disbursements), judgments, fines, settlements and other amounts arising from any and all claims, demands, actions, suits or proceedings, whether civil, criminal, administrative or
investigative, in which the Indemnitee may be involved or threatened to be involved, as a party or otherwise, arising out of or incidental to the business or activities of or relating to the Company, regardless of whether the Indemnitee continues to
be a Member, a Manager, an officer or any Affiliate thereof at the time any such liability or expense is paid or incurred; provided, however, that this provision shall not eliminate or limit the liability of an Indemnitee (i) for
any breach of the Indemnitee’s duty of loyalty to the Company or its Members, (ii) for acts or omissions which involve intentional misconduct or a knowing violation of law, or (iii) for any transaction from which the Indemnitee
received any improper personal benefit; provided, further, that the provisions of this Section 7.04(a) shall not apply to disputes among Members and Managers. 
 (b) Advances of Expenses. Expenses incurred by an Indemnitee in defending any claim, demand, action, suit, or proceeding subject to this
Section 7.04 shall, from time to time, upon request by the Indemnitee, be advanced by the Company prior to the final disposition of such claim, demand, action, suit or proceeding upon receipt by the Company of an undertaking by or on
behalf of the Indemnitee to repay such amount if it shall be determined in a judicial proceeding or a binding arbitration that such Indemnitee is not entitled to be indemnified as authorized in this Section 7.04. 
 (c) Other Rights. The indemnification provided by this Section 7.04 shall be in addition to any other rights to which an Indemnitee
may be entitled under any agreement, vote of the Board of Managers as a matter of law or equity, or otherwise, both as to an action in the Indemnitee’s capacity as a Member, a Manager, an officer or any Affiliate thereof, and as to an action in
another capacity, and shall continue as to an Indemnitee who has ceased to serve in such capacity and shall inure to the benefit of the heirs, successors, assigns, and administrators of the Indemnitee. 
 (d) Insurance. The Company may purchase and maintain insurance on behalf of the Board of Managers and such other Persons as the Board of Managers
shall determine against any liability that may be asserted against or expense that may be incurred by such Persons in connection with the offering of interests in the Company or the business or activities of the Company, regardless of whether the
Company would have the power to indemnify such Persons against such liability under the provisions of this Agreement. 
 (e) Effect of
Interest in Transaction. An Indemnitee shall not be denied indemnification in whole or in part under this Section 7.04 or otherwise by reason of the 

  

 -18- 

 
fact that the Indemnitee had an interest in the transaction with respect to which the indemnification applies if the transaction was otherwise permitted or
not expressly prohibited by the terms of this Agreement. 
 (f) No Third Party Rights. The provisions of this Section 7.04
are for the benefit of the Indemnitees, their heirs, successors, assigns and administrators and shall not be deemed to create any rights for the benefit of any other Persons. 
 ARTICLE VIII 
 DEADLOCK 
 8.01 Deadlock 
 (a) Occurrence of Deadlock. A
“Deadlock” shall occur where all of the following steps have been taken: 
 (i) First, a Member (the
“Proposing Member”) delivers to the other Member (the “Non-Proposing Member”) a Deadlock Meeting Notice (as defined below) at least ten (10) days prior to a proposed meeting (a “Deadlock
Meeting”); 
 (ii) Second, in the event that a Person authorized to act on behalf of the Non-Proposing Member does not attend
the first Deadlock Meeting called pursuant to subsection (i) above, then the Proposing Member shall send a second Deadlock Meeting Notice at least ten (10) days prior to a second proposed Deadlock Meeting; 
 (iii) Third, in the event that either (A) the Non-Proposing Member does not attend two or more Deadlock Meetings regarding the same Proposals
in connection with which Deadlock Meeting Notices were delivered or (B) Persons authorized to act on behalf of all Members attend a Deadlock Meeting and the Proposals are not approved in writing by all of the Members or withdrawn in writing by
the Proposing Member (an “Unresolved Proposal”), then during the thirty day (30) period following the occurrence of such Unresolved Proposal (the (“CEO Meeting Period”), the chief executive officers of each
Member shall meet and make a good faith effort to resolve the Unresolved Proposal (the “CEO Meeting”); 
 (iv) Fourth,
in the event that either (A) the CEO Meeting has occurred and the Unresolved Proposal has not been withdrawn in writing by the Proposing Member or approved in writing by all the Members or (B) during the CEO Meeting Period the CEO
Meeting does not occur and the Unresolved Proposal has not been withdrawn in writing by the Proposing Member or approved in writing by all the Members, and after which a written notice (the “Deadlock Notice”) has been provided by
the Proposing Member to the Non-Proposing Member (prior to sixty (60) days following the earlier of the CEO Meeting and the end of the CEO Meeting Period), and such Unresolved Proposal has not been withdrawn in writing by the Proposing Member
or approved in writing by all the Members during the thirty (30) days following the date of the Deadlock Notice. 
  

 -19- 

 A “Deadlock Meeting Notice” shall (A) provide a brief summary of one or more proposals with respect
to the Company (the “Proposals”) to be considered, (B) indicate that if the Proposal is not resolved, the Proposals may be the basis for a Deadlock, (C) provide the date, time and location for the Deadlock Meeting and
(D) provide the Non-Proposing Member with the option to attend such meeting via teleconference and include the information necessary to attend such meeting via teleconference. The “Deadlock Notice” shall include a summary of the
Proposals and the first date (and, if applicable, second date) on which the requisite vote to approve such action was not received. 
 (b)
Resolution of Deadlock. 
 (i) At any time between commencement of the CEO Meeting Period and thirty (30) days after the
occurrence of Deadlock, the Member that sent the Deadlock Notice (the “First Member”) may serve a written notice requesting the determination of the Deadlock Offer Price, and the Parties will then determine the Deadlock Offer Price
in accordance with Section 8.01(c) below and as set forth in the definition of “Fair Market Value” below. 
 (ii) The
First Member may, at any time during the ten (10) days following the later to occur of Deadlock or determination of the Deadlock Offer Price, serve a written notice (the “Offer Notice”) of its offer to purchase the entire
Company Interest and Percentage Interest of the other Member (the “Second Member”) for the price provided for in Section 8.01(c) below (the “Deadlock Offer Price”). Such offer contained in the Offer
Notice shall lapse forty-five (45) days after the Offer Notice is delivered to the Second Member. 
 (iii) If the offer contained in the
Offer Notice is not accepted before it lapses, the Second Member will be deemed to have served an Offer Notice to the First Member indicating the Second Member’s offer to purchase the First Member’s entire Company Interests and Percentage
Interest at the Deadlock Offer Price, and the First Member shall be deemed to have accepted such offer at the end of the forty-five (45) day period after the Offer Notice was delivered to the Second Member under (i) above. 
 (iv) Any sale of Company Interests and Percentage Interest pursuant to this Section 8.01(b) shall be effective within thirty (30) days
of the date of acceptance or deemed acceptance and the Member acquiring Company Interests and Percentage Interest from the selling Member shall deliver and pay to such selling Member (in U.S. Dollars) the Deadlock Offer Price for such Company
Interests and Percentage Interest pursuant to this Section 8.01(b) and the selling Member shall deliver to the purchasing Member evidence of receipt of such payment and evidence of sale of such Company Interests as is reasonably
satisfactory to the purchasing Member, and the Company shall pay any amount due under Section 5.07(d). 
 (v) Offer Notice. The
Offer Notice shall identify the matter pursuant to which a Deadlock has been reached, a summary of the pertinent dates relating to such Deadlock and an indication of the First Member’s offer to purchase the Second Member’s Company
Interests and Percentage Interest. 
  

 -20- 

 (c) Valuation of Company Interest. The “Deadlock Offer Price” shall be equal to
the Fair Market Value of the Company Interests and Percentage Interest being purchased by one Member from the other Member under Section 8.01(b) above, provided that if any Member or any Affiliate thereof is in breach of any of its agreements
with or obligations towards the Company, then the Fair Market Value shall be adjusted in a manner which would neutralize the effect of any such breach on the Fair Market Value (i.e., the Fair Market Value will be increased accordingly in case such
Member is selling its interest in the Company and the other Member is in breach and decreased accordingly if it is selling its interests in the Company and such Member is in breach). 
 ARTICLE IX 
 BANK ACCOUNTS; BOOKS AND RECORDS; 
 STATEMENTS; TAXES; FISCAL YEAR 
 9.01 Bank Accounts

 All funds of the Company shall be deposited in its name in such checking and savings accounts, time deposits, certificates of deposit
or other accounts (the “Bank Accounts”) at such banks as shall be designated by the Board of Managers from time to time, and the Board of Managers shall arrange for the appropriate conduct of such account or accounts. 
 9.02 Books and Records 
 The Board of Managers shall
keep, or cause to be kept, accurate, full and complete books and accounts showing assets, liabilities, income, operations, transactions and the financial condition of the Company. Such books and accounts shall be prepared on the accrual basis of
accounting. Any Member or its designee shall have access thereto at any reasonable time during regular business hours and shall have the right to copy said records at its expense. 
 9.03 Financial Statements and Information 
 (a) Preparation in Accordance with Generally Accepted
Accounting Principles. All financial statements prepared pursuant to this Section 9.03 shall present fairly the financial position and operating results of the Company and shall be prepared in accordance with generally accepted
accounting principles on the accrual basis for each Fiscal Year of the Company during the term of this Agreement. 
 (b) Unaudited
Quarterly Financial Statements. Within twenty (20) days after the end of each quarterly period (the “Fiscal Quarter”) of each Fiscal Year, commencing with the first Fiscal Quarter after the date of this Agreement, the Board
of Managers shall prepare and submit or cause to be prepared and submitted to the Members an unaudited statement of profit and loss for the Company for such Fiscal Quarter and an unaudited balance sheet of the Company dated as of the end of such
Fiscal Quarter, in each case prepared in accordance with generally accepted accounting principles consistently applied. 
  

 -21- 

 (c) Audited Annual Financial Statements. Within sixty (60) days after the end of each Fiscal
Year during the term of this Agreement, the Board of Managers shall prepare and submit or cause to be prepared and submitted to the Members an audited balance sheet, together with audited statements of profit and loss, Members’ equity and
changes in financial position for the Company during such Fiscal Year (the “Audited Financial Statements”). 
 (d) Other
Reports. The Board of Managers shall provide to the Members such other reports and information concerning the business and affairs of the Company as may be required by the Delaware LLC Act or by any other law or regulation of any regulatory body
applicable to the Company. 
 9.04 Accounting Decisions 
 All decisions as to accounting matters, except as specifically provided to the contrary herein, shall be made by the Board of Managers. 
 9.05 Where Maintained 
 The books, accounts and records of the Company at all times shall be
maintained at the Company’s principal office. 
 9.06 Fiscal Year 
 The fiscal year of the Company for financial, accounting, Federal, state and local income tax purposes shall initially be the fiscal year commencing on January 1 and ending on December 31 (the
“Fiscal Year”). The Board of Managers shall have authority to change the beginning and ending dates of the Fiscal Year if the Board of Managers, in its sole and absolute discretion, deems such change to be necessary or appropriate
to the business of the Company, and shall give written notice of any such change to the Members within thirty (30) days after the occurrence thereof. 
 ARTICLE X 
 TRANSFERS AND CONVERSION OF COMPANY INTERESTS 
 AND THE ADDITION, SUBSTITUTION 
 AND
WITHDRAWAL OF MEMBERS 
 10.01 Transfer of Company Interests 
 (a) Definition of Transfer. The term “transfer,” when used in this Article X with respect to a Company Interest or Percentage Interest, shall include any direct or indirect sale, assignment,
gift, pledge, hypothecation, mortgage, exchange, transfer or other disposition, disposal or delivery to a party which is not (directly or indirectly) wholly-owned by Point Blank or FMS; except that such term shall not include any 

  

 -22- 

 
pledge, mortgage or hypothecation of or granting of a security interest in a Company Interest or Percentage Interest in connection with any financing
obtained on behalf of the Company. Notwithstanding the foregoing and for the avoidance of any doubt, a Change of Control in FMS or in Point Blank shall not be considered as a “transfer” for purposes of this Article 10. 
 (b) Notwithstanding any other provision in this Agreement (including, but not limited to, the restrictions on transfer contained in
Section 10.02 below), PBSS shall be entitled to pledge, directly or indirectly, its Company Interests and Percentage Interest to, and otherwise grant a lien and security interest in its Company Interests and Percentage Interests and all
of its right, title and interest under this Agreement in favor of, PBSS’s and/or Point Blank’s lenders (or an agent on behalf of such lenders) without any further consents, approvals or actions required by such lenders (or agent), any
Member, the Company or any other person under this Agreement or otherwise, provided such pledgee provides the Company, prior to the grant of such pledge, with a written acknowledgement of Section 10.04(iii). So long as any such pledge of or
security interest in any PBSS Company Interest and Percentage Interest is in effect, no consent of the Company or any Member shall be required to permit a pledgee thereof to be substituted for PBSS under this Agreement upon the exercise of such
pledgee’s rights with respect to such Company Interests and Percentage Interests. As of the date hereof, PBSS has indirectly pledged its Company Interests and Percentage Interests to LaSalle Business Credit, LLC, as agent (in such capacity,
together with its successors, assigns and designated agents, the “Agent”) on behalf of itself and various lenders from time to time party to certain financing documents with the Point Blank and PBSS. Upon the exercise of the
Agent’s rights in respect of such pledge and security interest, the Agent, or any purchaser of PBSS’s Company Interests and Percentage Interests from the Agent, shall be substituted for PBSS as a Member under this Agreement, and such
substituted Member shall have all rights and powers as a Member under this Agreement. So long as any pledge of PBSS’s Company Interests and Percentage Interests is in effect, this provision shall inure to the benefit of such pledgee and its
successors, assigns and designated agents, as an intended third-party beneficiary, and no amendment, modification or waiver of, or consent with respect to this provision shall in any event be effective without the prior written consent of such
pledgee. 
 (c) Void Transfers. No Company Interest or Percentage Interest shall be transferred, in whole or in part, except in
accordance with the terms and conditions set forth in this Article X. Any transfer or purported transfer of any Company Interest or Percentage Interest not made in accordance with this Article X shall be void ab initio.

 10.02 Restrictions on Transfers 
 (a)
Consent Required. No Member may transfer all or any portion of its Company Interest or Percentage Interest without the express written consent of the nontransferring Member, except a transfer occurring after the fourth anniversary of the
Effective Date of all, but not less than all, of such Member’s Company Interest and Percentage Interest, and provided that such transfer is to a transferee who is not engaged in the business of designing, developing, manufacturing, or selling
in the U.S. woven fabric for use in soft body armor in the U.S. or who sells soft body armor in the U.S., which transfer is made in accordance with and subject to the terms of Section 10.03. 
  

 -23- 

 (b) Substitution. Any transferee of a Company Interest shall become a substituted Member upon
(i) transfer of Company Interests and Percentage Interest in compliance with Section 10.03 or (ii) the express written consent of the nontransferring Members in the exercise of their sole and absolute discretion; and
(A) the transferee agreeing to be bound by all the terms and conditions of the Certificate and this Agreement and all other agreements between the Members relating to the Company as then in effect; and (B) receipt of any necessary
regulatory approvals. Unless and until a transferee is admitted as a substituted Member, the transferee shall have no right to exercise any of the powers, rights, and privileges of a Member hereunder. A Member who has transferred its Company
Interest and Percentage Interest shall cease to be a Member upon transfer of such Member’s entire Company Interest and Percentage Interest and thereafter shall have no further powers, rights, and privileges as a Member hereunder except as
provided in Section 7.05. 
 (c) Dealing with Members. The Company, each Member, the Board of Managers, the Production
Manager, the Controller, and any other Person or Persons having business with the Company need deal only with Members who are admitted as Members or as substituted Members of the Company, and they shall not be required to deal with any other Person
by reason of transfer by a Member or by reason of the death of a Member, except as otherwise provided in this Agreement. In the absence of the substitution (as provided herein) of a Member for a transferring or a deceased Member, any payment to a
Member or to a Member’s executors or administrators shall acquit the Company and the Board of Managers of all liability to any other Persons who may be interested in such payment by reason of an assignment by, or the death of, such Member.

 10.03 Right of First Refusal 
 (a) If
at any time after the fourth anniversary of the Effective Date, a Member (the “Offering Member”) desires to effect a transfer of all, but not less than all, of its Company Interests and Percentage Interest and the Offering Member
receives from or otherwise negotiates with a third party that is not an Affiliate of the Offering Member (a “Third Party”) a bona fide offer (an “Offer”) for the transfer of all such Company Interests and Percentage
Interest (whether for cash, securities or a combination of both), the Offering Member shall serve the other Member (the “Offer Recipient”) with written notice of such Offer (the “First Refusal Offer Notice”),
identifying the Third Party making the Offer, the Company Interests and Percentage Interest covered by the Offer (the “Offered Interests”), the price at which such transfer is proposed to be made (the “Offer
Price”), and the other material terms and conditions of the proposed transfer. In the event any portion of the purchase price of the Company Interests and Percentage Interest to be paid by the proposed purchaser is to be paid in non-cash
consideration, the value of any such noncash consideration shall be the Fair Market Value thereof. 
 (b) Upon receipt of the First Refusal
Offer Notice, the Offer Recipient shall have the option to purchase at the Offer Price all, but not less than all, of the Offered 

  

 -24- 

 
Interests (the “First Offer”). The Offer Recipient shall, within fifteen (15) days from receipt of the First Refusal Offer Notice (the
“Offer Period”), indicate to the Offering Member whether it has accepted the First Offer, by sending irrevocable written notice of such acceptance (an “Acceptance Notice”) to the Offering Member. 
 (c) If effective acceptances shall not have been received from the Offer Recipient pursuant to Sections 10.03(b), then the Offering Member may, at
its election, either (i) transfer the Offered Interests to the Third Party purchaser referred to in Section 10.03(a) or (ii) rescind the First Refusal Offer Notice, which rescission shall be effected by notice in writing
delivered to the Offer Recipient within ten (10) days after the expiration of the Offer Period, and keep all, but not less than all, of the Offered Interests. In the event that the Offering Member elects to sell all, but not less than all, of
Offered Interests pursuant to clause (i) of this Section 10.03(c), the Third Party purchasing the Offered Interests must purchase such Offered Interests no more than sixty (60) days (or longer, if the HSR Act so requires) after the
expiration of the Offer Period strictly in accordance with the terms and conditions of the First Refusal Offer Notice. 
 (d) In the
event that the Offering Member shall not have transferred all of the Offered Interests within sixty (60) days (or longer, if the HSR Act so requires) after the expiration of the Offer Period, then the provisions of this
Section 10.03 shall again apply, and such Offering Member shall not thereafter transfer or offer to transfer such Company Interests without again complying with this Section 10.03. 
 10.04 Bankruptcy, Dissolution or Liquidation of a Member 
 (a) In the event: 
 (i) of (A) the entry of a decree or order for relief of a Member by a court of competent jurisdiction in
any involuntary case involving the Member under any bankruptcy, insolvency or other similar law now or hereafter in effect; (B) the appointment of a receiver, liquidator, assignee, custodian, trustee, sequestrator or other similar agent for the
Member or for any substantial part of the Member’s assets or property; (C) the ordering of the winding up or liquidation of the Member’s affairs; (D) the filing with respect to the Member of a petition in any such involuntary
bankruptcy case, which petition remains undismissed for a period of ninety (90) days or which is dismissed or suspended pursuant to Section 305 of the Federal Bankruptcy Code (or any corresponding provision of any future United States
bankruptcy law); (E) the commencement by the Member of a voluntary case under any bankruptcy, insolvency or other similar law now or hereafter in effect; (F) the consent by the Member to the entry of an order for relief in an involuntary
case under any such law or to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar agent for the Member or for any substantial part of the Member’s assets or property;
(G) the making by the Member of any general assignment for the benefit of creditors; or (H) the failure by the Member generally to pay its debts as such debts become due; 
  

 -25- 

 (ii) of the voluntary or involuntary dissolution or liquidation of a Member; then, in any such event, the
other Member (the “Continuing Member”) shall (i) have the right to purchase the entire Company Interest and Percentage Interest of the first Member (the “Withdrawing Member”) for an amount in U.S. Dollars equal
to the total Capital Account of such Withdrawing Member, plus [***] per annum on such Capital Contributions calculated for each Capital Contribution from the date it was made by the Withdrawing Member; provided that in connection with,
or prior to, such purchase by the Continuing Member of the Withdrawing Member’s Company Interest and Percentage Interest, the Company shall repay any and all amounts outstanding under any loans or advances made by the Withdrawing Member to the
Company (including, but not limited to, any amounts outstanding under any Initial Loans, any Additional Contribution Promissory Note and any other advance or loan made pursuant to Section 5.07 hereof), or (ii) at the option of the
Continuing Member, cause a dissolution of the LLC and the Board of Managers shall liquidate the LLC in accordance with the terms hereof. The rights of the Continuing Member shall become exercisable as of the date of any such event and shall be
exercisable, within sixty (60) days after the Continuing Member receives notice of such event; or 
 (iii) a pledgee or Agent of any
PBSS Company Interest and Percentage Interest is substituted for PBSS pursuant to Section 10.01(b) of this Agreement, FMSS shall (i) have the right to purchase such PBSS Company Interest and Percentage Interest for an amount in U.S.
Dollars equal to the total Capital Account of PBSS, plus six percent (6%) per annum on such Capital Contributions calculated for each Capital Contribution from the date it was made by PBSS; provided that in connection with, or prior to,
such purchase by FMSS of PBSS’s Company Interest and Percentage Interest, the Company shall repay any and all amounts outstanding under any loans or advances made by PBSS to the Company (including, but not limited to, any amounts outstanding
under any Initial Loans, any Additional Contribution Promissory Note and any other advance or loan made pursuant to Section 5.07 hereof), or (ii) at the option of FMSS, cause a dissolution of the LLC and the Board of Managers shall
liquidate the LLC in accordance with the terms hereof. The rights of FMSS pursuant to this Subsection 10.04(a)(iii) shall become exercisable as of the date of any such event and shall be exercisable, within sixty (60) days after FMSS
receives notice of such event. 
 10.05 Call Right 
 (a) Call Rights. 
 (i) In the event that FMSS, its Affiliate or successor undergoes a Change in
Control resulting in FMSS or its successor (holding its Company Interest or Percentage Interest) being directly or indirectly Controlled by a Person that is a Direct Competitor of PBSS (as defined on Addendum C), or which subsequently becomes
a Direct Competitor of PBSS, then in each such event PBSS, its Affiliate or successor may, at its election, purchase all, but not less than all, of FMSS’s, its Affiliate’s or successor’s Company Interests and Percentage Interests (the
“PBSS COC Call Right”) for [***]. If FMSS, its Affiliate or successor has undergone a Change of Control resulting in FMSS being 

  

 -26- 

 
Controlled by a Direct Competitor of PBSS as aforesaid, it shall notify in writing PBSS within five (5) days after it undergoes such Change of Control.
In addition: (i) in the event that PBSS, its Affiliate or successor undergoes a Change in Control resulting in PBSS or its successor (holding its Company Interest or Percentage Interest) being directly or indirectly Controlled by a Person that
is a Direct Competitor of FMSS (as defined on Addendum C), or which subsequently becomes a Direct Competitor of FMSS, then in each such event FMSS, its Affiliate or successor may, at its election, purchase all, but not less than all, of
PBSS’s, its Affiliate’s or successor’s Company Interests and Percentage Interests (the “FMSS COC Call Right”) for [***]. If PBSS, its Affiliate or successor has undergone a Change of Control resulting in PBSS
being Controlled by a Direct Competitor of FMSS as aforesaid, it shall notify in writing FMSS within five (5) days after it undergoes such Change of Control; (ii) in the event that Point Blank or any of its Affiliates sells or otherwise
transfer or dispose of (including by way of grant of an exclusive license) a significant portion of its assets used in its business of manufacturing and marketing soft protective body armor, resulting in a significant decrease (i.e., a decrease of
more than [***]) in Point Blanks’ annual need for the Products (as defined in the Supply Agreement), then FMSS, its Affiliate or successor may, at its election, purchase all, but not less than all, of PBSS’s, its Affiliate’s or
successor’s Company Interests and Percentage Interests (the “FMSS Asset Sale Call Right”) for [***], and (iii) in the event that, at any time during the term of the Supply Agreement, Point Blank is unable to
[***] as a result of [***] then FMSS, its Affiliate or successor may, at its election, purchase all, but not less than all, of PBSS’s, its Affiliate’s or successor’s Company Interests and Percentage Interests [***]
for a sum equal to [***] 
 (ii) In the event that FMSS or any other Company controlled by FMS or any of their respective
successors, assigns or transferees of all or substantially all of their respective assets, that become a Member of the Company (the “FMSS Party”), engage in the manufacturing in the U.S. of woven fabric for use in soft body armor
for sale in the U.S., then PBSS, may, at its election, purchase all, but not less than all, of FMSS’s Company Interests and Percentage Interests (the “PBSS Competitor Call Right,”) for [***]. FMSS, or its successor and
assigns (as applicable), shall notify in writing PBSS, or its successors and assigns (as applicable), within five (5) days after the occurrence of any of the events described in this Subsection (ii). 
 The PBSS COC Call Right, PBSS Competitor Call Right, FMSS COC Call Right, the FMSS Asset Sale Call Right, and the [***], may each be referred to herein as
a “Call Right”. 
 (b) Procedure. If a Member that has the right to exercise a Call Right (the “Purchasing
Member”) desires to exercise such Call Right, then the Purchasing Member shall provide written notice (the “Call Exercise Notice”) to the other Member (the “Selling Member”), by no later than thirty
(30) days after he receives notice regarding its Call Right from the other Member, stating that it desires to purchase all (but not less than all) of such Selling Member’s Company Interests and Percentage Interest. The purchase price
determined above shall, be paid by the Purchasing Member to the Selling Member in cash or other immediately available funds and the consummation of the transfer of 

  

 -27- 

 
Company Interests and Percentage Interest by the Selling Member to the Purchasing Member shall occur within thirty (30) days after the Selling Member
receives the Call Exercise Notice, provided that the Selling Member does not dispute the Purchasing Member’s claim that the Purchasing Member has an exercisable Call Right, or if such right is disputed, then as soon as such dispute is finally
resolved and determined in accordance with Section 14.17 below. 
 10.06 No Right to Withdraw 
 No Member shall have any right to resign or otherwise withdraw from the Company without the express written consent of all the other Members. 

ARTICLE XI 
 DISSOLUTION AND
LIQUIDATION 
 11.01 Events Causing Dissolution 
 (a) Dissolution. The Company shall be dissolved and its affairs wound up only upon the occurrence of any of the following events: 
 (i) the unanimous consent in writing to dissolve and wind up the affairs of the Company by all of the Members; 
 (ii) the sale or other disposition by the Company of all or substantially all of the Company Assets and the collection of all amounts derived from any such sale or other disposition, including all amounts payable to the Company under any
promissory notes or other evidences of indebtedness taken by the Company and the satisfaction of contingent liabilities of the Company in connection with such sale or other disposition (unless the Members shall elect to distribute such indebtedness
to the Members in liquidation); or 
 (iii) the occurrence of any event that, under the Delaware LLC Act, would cause the dissolution of the
Company or that would make it unlawful for the business of the LCC to be continued. 
 (iv) Upon the written notice to the Board of Managers
requesting such dissolution provided by a Nonbreaching Member (as defined below) in case the Breaching Member fails to cure its material breach of this Agreement within thirty (30) days from its receipt of a Notice of Breach (as defined below),
provided, however that if the Breaching Member disputes the claim that it is in material breach of this Agreement, then this right of the Nonbreaching Member to dissolve the Company shall apply only if such dispute is finally resolved and determined
in accordance with Section 14.17 below in favor of the Nonbreaching Party (so that the arbitrators determine that the Breaching Member has indeed breached the Agreement), and only if the Breaching Member failed to cure such breach within
thirty (30) days following the resolution of such dispute as aforesaid. 
  

 -28- 

 (b) Default. If a Member (a “Breaching Member”) fails to perform any of its
material obligations under this agreement (a “Breach”) then the other Member (a “Nonbreaching Member”), shall have the right to give the Breaching Member notice (a “Notice of Breach”). The Notice of
Breach shall set forth the nature of the obligations which the Breaching Member has failed to perform. If the Breaching Member fails to cure the Breach within thirty (30) days, and the Nonbreaching Member has given Notice of Breach in
compliance with this section, the Nonbreaching Member may cause the determination of Fair Market Value and purchase the Breaching Member’s entire Company Interest and Percentage Interests at a price equal to the Fair Market Value of such
interest. The rights of the Nonbreaching Members to purchase the Breaching Member’s interest shall be exercised, if at all, within sixty (60) days after (x) the determination of Fair Market Value, provided, however that if the
Breaching Member disputes the claim that it is in material breach of this Agreement, then the right of the Nonbreaching Member to purchase the Breaching Member’s interest in the Company shall apply only if such dispute is finally resolved and
determined in accordance with Section 14.17 below in favor of the Nonbreaching Party (so that the arbitrators determine that the Breaching Member has indeed breached the Agreement), and only if the Breaching Member failed to cure such
breach within thirty (30) days following the resolution of such dispute as aforesaid. The fees of any and all Appraisers used to determine Fair Market Value under this Section 11.01(b) shall be borne by the Breaching Member. The
rights granted in this Section 11.01(b) above shall not be deemed the exclusive remedy of a Nonbreaching Member, but all other rights and remedies, legal and equitable, shall be available to it. 
 11.02 Cancellation of Certificate 
 Upon the
dissolution of the Company, the Certificate shall be canceled in accordance with the provisions of Section 18-203 of the Delaware LLC Act, and the Board of Managers (or any other person or entity responsible for winding up the affairs of the
Company) shall promptly notify the Members of such dissolution. 
 11.03 Distributions Upon Dissolution 
 (a) Upon the dissolution of the Company, the Board of Managers (or any other person or entity responsible for winding up the affairs of the Company) shall
proceed without any unnecessary delay to sell or otherwise liquidate the Company Assets and pay or make due provision for the payment of all debts, liabilities and obligations of the Company. 
 (b) The Board of Managers (or any other person or entity responsible for winding up the affairs of the Company) shall distribute the net liquidation
proceeds and any other liquid assets of the Company, after the payment of all debts, liabilities and obligations of the Company (including, without limitation, all amounts owing to a Member under this Agreement or under any agreement between the
Company and a Member, the payment of expenses of liquidation of the Company, and the establishment of a reasonable reserve in an amount estimated by the Board of Managers to be sufficient to pay any amounts reasonably anticipated to be required to
be paid by the Company, to 

  

 -29- 

 
the Members first, to the Members in the amounts necessary to cause such Members’ Capital Accounts Percentage to be equal to their Percentage
Interests, Second, pro rata, in proportion to the positive balances, if any, in their respective Capital Accounts until such Capital Accounts are reduced to zero sums, and, third, pro rata, in accordance with the Members
respective Percentage Interests. 
 11.04 Reasonable Time for Winding Up 
 A reasonable time shall be allowed for the orderly winding up of the business and affairs of the Company and the liquidation of its assets pursuant to Section 11.03 in order to minimize any losses
otherwise attendant upon such a winding up. 
 ARTICLE XII 
 STANDSTILL AGREEMENT 
 12.01 Standstill. 
 PBSS and FMSS agree that during the Restricted Period (as defined below), neither such party nor any Affiliate thereof will, without the prior written
consent of the other party: 
 (a) acquire, offer to acquire, or agree to acquire, or
encourage or suggest to any third party that they acquire, offer to acquire, or agree to acquire, directly or indirectly, by purchase or otherwise, an aggregate of two and one-half percent (2 1/
2%) or more (including any such securities held prior to such acquisition by such party or Affiliate of such party) of any voting securities or direct or indirect rights to
acquire any voting securities of the other party hereto or its Affiliates (other than the Company); 
 (b) make, or in any way
participate, directly or indirectly, or encourage or suggest to any third party that they make, or in any way participate, in any “solicitation” of “proxies” to vote (as such terms are used in the rules of the Securities and
Exchange Commission), or seek to advise or influence any person or entity with respect to the voting of any voting securities of the other party hereto, or its Affiliates (other than the Company), with respect to (i) any extraordinary
transaction, such as a merger, reorganization or liquidation involving such other party hereto, or its Affiliates (other than the Company), (ii) any material change in the present board of directors or management of such other party hereto, or
its Affiliates (other than the Company), including, but not limited to, any plans or proposals to change the number or the term of directors, to remove any director or to fill any existing vacancies on the board, or to change any material term of
the employment contract of any executive officer, (iii) the opposition of any person nominated by such other party’s, or its Affiliates’ (other than the Company), nominating committees, or (iv) any material change in such other
party hereto’s, or its Affiliates’ (other than the Company), capital structure or business; 
 (c) make any public announcement
with respect to any matter described in subparagraphs (a) and (b) above; 
  

 -30- 

 (d) form, join or in any way participate in a “group” as defined in Section 13(d)(3) of
the Securities Exchange Act of 1934, as amended, in connection with any of the foregoing; or 
 (e) take any action that could reasonably be
expected to require such other party hereto, or its Affiliates (other than the Company), to make a public announcement regarding the possibility of any of the events described in clauses (a) or (b) above. 
 12.02 Restricted Period 
 The “Restricted
Period” shall commence as of the Effective Date and shall continue until the earliest to occur of: 
 (a) the mutual written consent
of PBSS and FMSS; 
 (b) the dissolution of the Company in accordance with the terms and conditions of this Agreement; and 
 (c) twelve (12) months after the transfer by PBSS or FMSS of all, but not less than all, of such party’s Company Interest and Percentage
Interest to the other party, or its Affiliates, or a Third Party in accordance with the terms and conditions of the Agreement. 
 ARTICLE
XIII 
 REPRESENTATIONS AND WARRANTIES 
 13.01 Representations and Warranties of FMSS 
 FMSS hereby represents and warrants to the Company and PBSS that: 

(a) Organization of FMSS; Power and Authority. FMSS is a limited liability company duly organized, validly existing and in good standing under
the laws of the state of Delaware. FMSS has all requisite power and authority to own and operate its properties and assets, to execute and deliver this Agreement and all other agreements contemplated hereby, and to carry on its business as presently
conducted and as presently proposed to be conducted. FMSS is duly qualified and is authorized to do business and is in good standing as a foreign corporation in all jurisdictions in which the nature of its activities and of its properties makes such
qualification necessary, except for those jurisdictions in which the failure to do so would not have a Material Adverse Effect on FMSS. 
 (b) Due Authorization. The execution, delivery and performance of this Agreement and all other agreements contemplated hereby have been duly authorized by FMSS and any required approvals have been obtained except where the failure to
obtain such approval would not have a Material Adverse Effect on FMSS. 
 (c) Binding Obligation. This Agreement has been duly
executed and 

  

 -31- 

 
delivered by FMSS and is a valid and binding obligation of FMSS, enforceable in accordance with its terms, subject to (i) applicable bankruptcy,
insolvency, reorganization, fraudulent transfer, moratorium or similar laws affecting creditors’ rights generally, and (ii) general principles of equity, including, without limitation, standards of materiality, good faith, fair dealing and
reasonableness, equitable defenses and limits on the availability of equitable remedies, whether such principles are considered at law or in equity. 
 (d) Conflicts. Neither the execution and delivery of this Agreement or any of the agreements contemplated hereby nor the consummation of the transactions contemplated hereby or thereby will: (i) conflict
with or violate any provision of the Certificate or operating agreement of FMSS, (ii) conflict with or violate any law, ordinance or regulation or any decree or order of any court or administrative or other governmental body which is either
applicable to, binding upon or enforceable against FMSS or (iii) subject to obtaining the consents and waivers set forth in Schedule 13.01(d) hereto, result in a breach of, constitute a default under, result in the acceleration of,
create in any party the right to accelerate, terminate, modify or cancel, or require any notice under any mortgage, contract, agreement, indenture, will, trust or other instrument which is either binding upon or enforceable against FMSS or its
assets and properties. 
 (e) Consents. Other than as set forth in Schedule 13.01(e) hereto, no registration or filing with, or
consent or approval of or other action by, any federal, state or other governmental agency or instrumentality is or will be necessary for the valid execution, delivery and performance by FMSS of this Agreement or any agreement or transaction
contemplated by this Agreement. 
 (g) Securities Representations. 
 (i) FMSS is purchasing the Company Interests for FMSS’s own account, with the intention of holding the Company Interests for investment, with no
present intention of dividing, or allowing others to participate in, this investment, or of reselling, or otherwise participating directly or indirectly in a distribution of, the Company Interests. FMSS will not, directly or indirectly, offer,
transfer, sell, assign, pledge, hypothecate or otherwise dispose of any of the Company Interests (or solicit any offers to buy or otherwise acquire any of the Company Interests), except in compliance with the Securities Act of 1933, as amended (the
“Securities Act”). 
 (ii) FMSS, by reason of its business and financial experience, declares and confirms that it has such
knowledge, sophistication and experience in business and financial matters as to be capable of evaluating the merits and risks of the prospective investment and is able to bear the economic risk of such investment, including the ability to afford
holding the Company Interest for an indefinite period or to afford a complete loss of this investment. 
  

 -32- 

 (iii) FMSS understands that no federal or state agency has made any finding or determination regarding
the fairness of the offering of the Company Interests for investment, or any recommendation or endorsement of the offering of the Company Interests. 
 13.02 Representations and Warranties of PBSS 
 PBSS hereby represents and warrants to the Company and FMSS that: 

(a) Organization of PBSS; Power and Authority. PBSS is a limited liability company duly organized, validly existing and in good standing under
the laws of the State of Delaware. PBSS has all requisite power and authority to own and operate its properties and assets, to execute and deliver this Agreement and all other agreements contemplated hereby, and to carry on its business as presently
conducted and as presently proposed to be conducted. PBSS is duly qualified and is authorized to do business and is in good standing as a foreign corporation in all jurisdictions in which the nature of its activities and of its properties makes such
qualification necessary, except for those jurisdictions in which the failure to do so would not have a Material Adverse Effect on PBSS. 
 (b) Due Authorization. The execution, delivery and performance of this Agreement and all other agreements contemplated hereby have been duly authorized by PBSS. 
 (c) Binding Obligation. This Agreement has been duly executed and delivered by PBSS and is a valid and binding obligation of PBSS, enforceable in
accordance with its terms, subject to (i) applicable bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium and similar laws affecting creditors’ rights generally, and (ii) general principles of equity, including,
without limitation, standards of materiality, good faith, fair dealing and reasonableness, equitable defenses and limits on the availability of equitable remedies, whether such principles are considered at law or in equity. 
 (d) Conflicts. Neither the execution and delivery of this Agreement or any of the agreements contemplated hereby nor the consummation of the
transactions contemplated hereby or thereby will: (i) conflict with or violate any provision of the Certificate or operating agreement of PBSS, (ii) conflict with or violate any law, ordinance or regulation or any decree or order of any
court or administrative or other governmental body which is either applicable to, binding upon or enforceable against PBSS or (iii) subject to obtaining the consents and waivers set forth in Schedule 13.02(d) hereto, result in a breach
of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify or cancel, or require any notice under any mortgage, contract, agreement indenture, will, trust or other instrument which
is either binding upon or enforceable against PBSS or its assets and properties. 
 (e) Consents. Other than as set forth in
Schedule 13.02(e) hereto, no 

  

 -33- 

 
registration or filing with, or consent or approval of or other action by, any federal, state or other governmental agency or instrumentality is or will be
necessary for the valid execution, delivery and performance by PBSS of this Agreement or any agreement or transaction contemplated by this Agreement. 
 (f) Securities Representations. 
 (i) PBSS is purchasing the Company Interests for PBSS’s own
account, with the intention of holding the Company Interests for investment, with no present intention of dividing, or allowing others to participate in, this investment, or of reselling, or otherwise participating directly or indirectly in a
distribution of, the Company Interests. PBSS will not, directly or indirectly, offer, transfer, sell, assign, pledge, hypothecate or otherwise dispose of any of the Company Interests (or solicit any offers to buy or otherwise acquire any of the
Company Interests), except in compliance with the Securities Act. 
 (ii) PBSS, by reason of its business and financial experience, declares
and confirms that it has such knowledge, sophistication and experience in business and financial matters as to be capable of evaluating the merits and risks of the prospective investment and is able to bear the economic risk of such investment,
including the ability to afford holding the Company Interest for an indefinite period or to afford a complete loss of this investment. 
 (iii) PBSS understands that no federal or state agency has made any finding or determination regarding the fairness of the offering of the Company Interests for investment, or any recommendation or endorsement of the offering of the Company
Interests. 
 ARTICLE XIV 
 MISCELLANEOUS PROVISIONS 
 14.01 Compliance with Delaware LLC Act 
 Each Member agrees not to take any action or fail to take any action, which, considered alone or in the aggregate with other actions or events, would
result in the termination of the Company under the Delaware LLC Act. 
 14.02 Additional Actions and Documents 
 Each of the Members hereby agrees to take or cause to be taken such further actions, to execute, acknowledge, deliver and file or cause to be executed,
acknowledged, delivered and filed such further documents and instruments, and to use best efforts to obtain such consents, as may be necessary or as may be reasonably requested to fully effectuate the purposes, terms and conditions of this
Agreement, whether before, at or after the date of this Agreement. 
  

 -34- 

 14.03 Notices 
 All notices, demands, requests or other communications which may be or are required to be given, served or sent by a Member pursuant to this Agreement shall be in writing and shall be hand delivered (including delivery by courier), mailed
by first-class, registered or certified mail, return receipt requested, postage prepaid, or transmitted by telegram, telex or facsimile transmission, addressed as follows: 
 If to PBSS: 
 PBSS, LLC 
 2102 SW 2nd Street, 
 Pompano Beach, Florida 33069 
 United States of America 
 Attention: Larry
R. Ellis 
 Telephone number: 954-630-0900 
 Facsimile number: 954-630-0980 
 With a copy, which shall not constitute notice, to: 
 Venable LLP 
 2 Hopkins Plaza, Suite 1800

 Baltimore, Maryland 21201 
 United States of America 
 Attention: Thomas D. Washburne, Jr. 
 Telephone number: 410-244-7744 
 Facsimile:
410-244-7742 
 If to FMSS: 
 FMS Enterprises Migun Ltd. 
 27 Imber Street 
 Kiryat Arye, Petach Tikva, Israel 
 Facsimile 972-3-2995414 
 Attention: Daniel Blum 
 With a copy, which shall not constitute notice, to: 
 Meitar Liquornik Geva & Leshem Brandwein, Law
Offices 
 16 Abba Hillel Rd. 
 Ramat Gan 52506, Israel 
 Attention: Dr. Israel Leshem 
 Telephone number: 972-3-6103100 
 Facsimile
972-3-6103111 
 Each Member may designate by notice in writing a new address to which any notice, demand, request or communication may
thereafter be so given, served or sent. 

  

 -35- 

 
Each notice, demand, request or communication which shall be delivered, mailed or transmitted in the manner described above shall be deemed sufficiently
given, served, sent or received for all purposes at such time as it is delivered to the addressee (with an affidavit of personal delivery, the return receipt, the delivery receipt or (with respect to a telex) the answer back being deemed conclusive
evidence of such delivery) or at such time as delivery is refused by the addressee upon presentation. 
 14.04 Severability 
 The invalidity of any one or more provisions hereof or of any other agreement or instrument given pursuant to or in connection with this Agreement shall
not affect the remaining portions of this Agreement or any such other agreement or instrument or any part thereof, all of which are included subject to the condition that they are held valid in law; and in the event that one or more of the
provisions contained herein or therein should be invalid, or should operate to render this Agreement or any such other agreement or instrument invalid, this Agreement and such other agreements and instruments shall be construed as if such invalid
provisions had not been inserted. 
 14.05 Survival 
 It is the express intention and agreement of the Members that all covenants, agreements, statements, representations, warranties and indemnities made in this Agreement shall survive the execution and delivery of this
Agreement. 
 14.06 Waivers 
 Neither the
waiver by a Member of a breach of or a default under any of the provisions of this Agreement, nor the failure of a Member, on one or more occasions, to enforce any of the provisions of this Agreement or to exercise any right, remedy or privilege
hereunder, shall thereafter be construed as a waiver of any subsequent breach or default of a similar nature, or as a waiver of any such provisions, rights, remedies or privileges hereunder. 
 14.07 Exercise of Rights 
 No failure or delay on the
part of a Member or the Company in exercising any right, power or privilege hereunder and no course of dealing between the Members or between a Member and the Company shall operate as a waiver thereof, nor shall any single or partial exercise of any
right, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein expressly provided are cumulative and not exclusive of any other rights or
remedies which a Member or the Company would otherwise have at law or in equity or otherwise. 
  

 -36- 

 14.08 Binding Effect 
 Subject to any provisions hereof restricting assignment, this Agreement shall be binding upon and shall inure to the benefit of the Members and their respective heirs, devises, executors, administrators, legal
representatives, successors and assigns. 
 14.09 Limitation on Benefits of this Agreement 
 Subject to Section 7.04, it is the explicit intention of the Members that no person or entity other than the Members and the Company is or
shall be entitled to bring any action to enforce any provision of this Agreement against any Member or the Company, and that the covenants, undertakings and agreements set forth in this Agreement shall be solely for the benefit of, and shall be
enforceable only by, the Members (or their respective successors and assigns as permitted hereunder) and the Company. 
 14.10 Amendment Procedure 

 Except for adjustments to the Member’s Percentage Interests as a result of purchase of such interest as set forth in this
Agreement, this Agreement may only be modified or amended by the unanimous written consent of the Members. 
 14.11 Entire Agreement

 This Agreement contains the entire agreement between the Members with respect to the transactions contemplated herein and the operation
of the Company, and supersedes all prior oral or written agreements, commitments or understandings with respect to the matters provided for herein and therein. 
 14.12 Pronouns 
 All pronouns and any variations thereof shall be deemed to refer to the masculine, feminine, neuter,
singular or plural, as the identity of the person or entity may require. 
 14.13 Headings 
 Article, Section and subsection headings contained in this Agreement are inserted for convenience of reference only, shall not be deemed to be a part of
this Agreement for any purpose, and shall not in any way define or affect the meaning, construction or scope of any of the provisions hereof. 
  

 -37- 

 14.14 Governing Law; Jurisdiction 
 This Agreement, the rights and obligations of the parties hereto, and any claims or disputes relating thereto, shall be governed by and construed in accordance with the laws of the State of New York (but not including
the choice of law rules thereof). The parties agree to submit to the exclusive jurisdiction and venue of the appropriate State and Federal courts in the State of New York, for purposes of enforcing any arbitration awards under
Section 14.17. 
 14.15 Execution in Counterparts 
 To facilitate execution, this Agreement may be executed in as many counterparts as may be required; and it shall not be necessary that the signatures of, or on behalf of, each party, or that the signatures of all
persons required to bind any party, appear on each counterpart; but it shall be sufficient that the signature of, or on behalf of, each party, or that the signatures of the persons required to bind any party, appear on one or more of the
counterparts. All counterparts shall collectively constitute a single agreement. It shall not be necessary in making proof of this Agreement to produce or account for more than a number of counterparts containing the respective signatures of, or on
behalf of, all of the parties hereto. 
 14.16 Announcements 
 Except as required by law or applicable stock exchange regulation (including without limitation pursuant to Israeli stock exchange regulations and securities law, neither the Company or any Member shall make any
announcement, press release or other public statement relating in any manner to this Agreement, the terms hereof, the relationship of the parties hereto or the Company without first obtaining the consent of the other Member to the disclosure
proposed to be made. The Members shall not unreasonably withhold their consent to any request made by a party pursuant to this Section 14.16. The Members shall use their best efforts to consult and coordinate with each other before
making any announcement, press release or other public statement relating to the Company as required by law or applicable stock exchange regulation. 
 14.17 Arbitration 
 All claims, disputes and other matters in question arising out of, or relating to, this Agreement or the
performance thereof, including but not limited to questions as to whether a matter if governed by this arbitration clause, shall be subject to arbitration (provided that this section shall not preclude injunctive relief for claims under
Section 7.03) if good faith negotiations among the parties does not resolve such claim, dispute or other matter within 60 days. Such arbitration shall proceed in accordance with the Commercial Arbitration Rules of the American
Arbitration Association, unless the parties mutually agree otherwise, and pursuant to the following procedures: 
 (a) Reasonable discovery
shall be allowed in arbitration. 
  

 -38- 

 (b) All proceedings before the arbitrators shall be held in New York, New York. The governing law shall
be as specified in Section 14.14. 
 (c) The costs and fees of the arbitration, including attorney’s fees, shall be
allocated by the arbitrators. 
 (d) The award rendered by the arbitrators shall be final and judgment may be entered in accordance with
applicable law and in any court having jurisdiction thereof. 
 (e) The existence and resolution of the arbitration shall be kept
confidential by the Members in the same manner as confidential information is required to be kept under Confidentiality Agreement, and shall also be kept confidential by the arbitrators. 
 14.18 Weaving for FMS 
 As of the Effective Date, the Company agrees to weave, pursuant to FMS’
orders to be submitted to the Company from time to time, up to [***] without charge to FMS and to make such [***] available for pick-up by FMS at the Plant; provided that (i) FMS shall be responsible for delivery of all yarn
required by the Company to weave such [***] and delivery of such yarn shall be made not less than [***] and not more than [***] prior to the date on which FMS requests that the Company make the [***] available for
delivery to FMS and (ii) the Company shall not be required under this Section 14.18 to weave in excess of [***] pounds in any [***]. The Parties agree and acknowledge that a quantity of [***] pounds of
[***] products are on the Effective Date already being produced at the Plant and are and shall remain the sole and exclusive property of FMS, and the Company shall complete, as soon as possible, the manufacture of such products and supply
them, free of charge, to FMS. 
  

 -39- 

 IN WITNESS WHEREOF, the undersigned have duly executed this Limited Liability Company Agreement or
have caused this Limited Liability Company Agreement to be duly executed on their behalf as of the day and year first set forth above. 
  

			
	PBSS
		
	By:	 	 /s/ John C. Siemer

	Name:	 	John C. Siemer
	Title:	 	President
	
	FMSS
		
	By:	 	  

	Name:	 	
	Title:	 	
	
	FMS
	(Executed by FMS solely to evidence FMS’s acknowledgement of, and agreement to, the provisions contained in Section 14.18 and the dispute resolution and governing law
sections contained herein which shall be applicable to such section)
		
	By:	 	  

	Name:	 	
	Title:	 	

 {Signature Page to JV Operating Agreement} 

 ADDENDUM A 
 DEFINITIONS 
 “Adjusted Capital Account Deficit”: With respect to any Member, the
deficit balance, if any, in the Member’s Capital Account as of the end of the relevant taxable year, after giving effect to the following adjustments: 
 (i) the deficit shall be decreased by the amounts which the Member is deemed obligated to restore pursuant to Regulation Sections 1.704-1(b)(2)(ii)(c), 1.704-2(g)(1) and 1.704-2(i)(5); and 
 (ii) the deficit shall be increased by the items described in Regulation Section 1.704-1(b)(2)(ii)(d)(4),(5), and (6). 
 “Affiliate”: Any Person directly or indirectly controlling, controlled by, or under common control with the Person in question;
if the Person in question is a corporation, any executive officer or director of the Person in question or of any corporation directly or indirectly controlling the Person in question. As used in this definition of “Affiliate”, the term
“control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract, or otherwise. 
 “Agreement”: This Limited Liability Company Agreement, as it may be further amended or supplemented from time to time.

 “Appraiser”: An independent appraiser to be selected from the appraisers listed on Addendum D; provided
that in the event that at the time the Members are to choose an Appraiser, the Members cannot agree on an Appraiser provided on Addendum D, then each Member shall alternate in “striking” one appraiser from such list (with the Member
that will have the first opportunity to purchase a Company Interest based on the appraisal to be performed having the first “strike”), until only one appraiser remains and such remaining appraiser shall be the Appraiser appointed to
perform the current appraisal. Neither Member or its Affiliates shall engage any of the appraisers listed on Addendum D such that a conflict of interest will be created. 
 “Business Day”: Monday through Friday of each week, except that a legal holiday recognized as such by the Government of the United States shall not be regarded as a Business Day. 
 “Capital Account Percentage”: The percentage determined by dividing the dollar value of a Member’s Capital Account by the aggregate
total dollar value of all Member’s Capital Accounts. 
 “Capital Commitment”: For each of PBSS and FMSS the Capital
Commitments shall be Two-Hundred-Fifty Thousand Dollars ($250,000). 
 “Capital Contribution”: Any property
(including cash) contributed to the Company by or on behalf of a Member. 
  

 A-1 

 “Certificate”: The Certificate of Formation of the Company, and any and all
amendments thereto, filed on behalf of the Company with the Recording Office as required under the Delaware LLC Act. 
 “Change of
Control”: A change in the Person that has direct or indirect Control of a Person. 
 “Code”: The Internal
Revenue Code of 1986, as in effect and hereafter amended. Any reference herein to a specific section or sections of the Code shall be deemed to include a reference to any corresponding provision of future law. 
 “Company Assets”: All assets and property, whether tangible or intangible and whether real, personal, or mixed, at any time owned
by or held for the benefit of the Company. 
 “Company Interest”: As to any Member, all of the interest of that
Member in the Company, including, without limitation (i) such Member’s ownership and equity interest in the Company, (ii) such Member’s right to a distributive share of the income, gain, losses and deductions of the Company in
accordance with this Agreement, and (iii) such Member’s right to a distributive share of Company Assets. 
 “Control”: Control includes, without limitation, the possession, directly or indirectly, of the power to direct the management and policies of a Person, whether through the ownership of voting securities, by contract or
otherwise. 
 “Delaware LLC Act”: The Delaware Limited Liability Company Act, as amended from time to time.

 “Event of Default”: As defined in Section 5.04. 
 “Fair Market Value”: With respect to any property or asset, the dollar value of the property or asset determined (i) by mutual
agreement of the Members, or (ii) if the Members cannot so agree within twenty (20) days after one Member first proposes in writing to the other Member that Fair Market Value be determined, by an independent Appraiser. The Appraiser’s
determination of Fair Market Value of applicable Company Interests and Percentage Interests shall be made (i) by averaging the appraised value using each of the following three methods of appraisal (A) market value, (B) book value
(determined in accordance with GAAP as a “going concern”) and (C) discounted cash flows, assuming, if the Supply Agreement is in effect, that the Supply Agreement will continue through and until the expiration of the Initial Term or
Extended Term (as defined in the Supply Agreement) then in effect and (ii), treating the amounts of any then existing Member Loans (other than any Member’s Excess Loan Amount, which will be treated as debt payable pursuant to
Section 5.07(d) above) as though such amounts are Capital Contributions. The Appraiser’s appraisal shall constitute a final determination of Fair Market Value of the property or asset and shall be binding upon the Members. 
 “FMS”: means FMS Enterprises Migun Ltd., a limited liability company organized under the laws of the State of Israel. 
  

 A-2 

 “GAAP”: Generally accepted accounting principles in the United States of America.

 “HSR Act”: The United States Hart-Scott-Rodino Antitrust Improvements Act of 1976 and the rules and regulations
promulgated thereunder. 
 “Initial Budget”: The Initial Budget, attached hereto as Addendum B. 
 “Intellectual Property”: Means (i) inventions, improvements, discoveries, know how, concepts and ideas, whether patentable or not;
(ii) patents, revalidations, industrial designs, industrial models and utility models, design patent rights, patent applications (including reissues, continuations, divisions, continuations-in-part and extensions) and patent disclosures;
(iii) trade secrets and proprietary or confidential information and rights in any jurisdiction to limit the use or disclosure thereof by any person; (iv) copyrights, copyright registrations and applications for registration of copyrights
in any jurisdiction, and any renewals or extensions thereof and any moral rights existing in connection therewith; and (v) all other intellectual property or industrial property rights recognized anywhere. 
 “Manager”: Any member of the Board of Managers. 
 “Member”: PBSS and FMSS and any other Person who shall in the future execute and deliver this Agreement pursuant to the provisions hereof. 
 “Member Loan”: All outstanding loans and accrued interest owed by the Company to a Member. 
 “Member Loan Nonrecourse Deductions”: Any Company deduction that would be Nonrecourse Deductions if they were not attributable to a loan
made or guaranteed by a Member within the meaning of Regulation Section 1.704-2(i). 
 “Minimum Gain”: The meaning set
forth in Regulation Section 1.704-2(d). Minimum Gain shall be computed separately for each Member in a manner consistent with the Regulations under Code Section 704(b). 
 “Net Income and Net Loss”. means, for each taxable year of the Company (or other period for which Net Income or Net Loss must be
computed) the Company’s taxable income or loss determined in accordance with Code Section 703(a), with the following adjustments: 
 (a) all items of income, gain, loss, deduction, or credit required to be stated separately pursuant to Code Section 703(a)(1) shall be included in computing taxable income or loss; 
 (b) any tax-exempt income of the Company, not otherwise taken into account in computing Net Income or Net Loss, shall be included in computing taxable
income or loss; 
  

 A-3 

 (c) any expenditures of the Company described in Code Section 705(a)(2)(B) (or treated as such
pursuant to Regulation Section 1.704-1(b)(2)(iv)(i)) and not otherwise taken into account in Net Income or Net Loss, shall be subtracted from Net Income or Net Loss; 
 (d) gain or loss resulting from any taxable disposition of Company property shall be computed by reference to the adjusted book value of the property disposed of, notwithstanding the fact that the adjusted book value
differs from the adjusted basis of the property for federal income tax purposes; 
 (e) in lieu of the depreciation, amortization, or cost
recovery deductions allowable in computing taxable income or loss, there shall be taken into account the depreciation computed based upon the adjusted book value of the asset; and 
 (f) notwithstanding any other provision of this definition, any items which are specially allocated pursuant to Section 6.04(b) hereof shall not be
taken into account in computing Net Income or Net Loss. 
 “Nonrecourse Liability”: Any liability of the Company with
respect to which no Member or no Person related to a Member has personal liability determined in accordance with Code Section 752 and the Regulations promulgated thereunder. 
 “Nonrecourse Deductions”: The meaning set forth in Regulation Section 1.704-2(b)(1). The amount of Nonrecourse Deductions for a
taxable year of the Company equals the net increase, if any, in the amount of Minimum Gain during that taxable year, determined according to the provisions of Regulation Section 1.704-2(c). 
 “Percentage Interest”: The percentage the Company Interest owned by each Member constitutes out of the total Company Interests
owned by all Members (i.e., which together constitute 100% of the ownership, equity and other interests in the Company). The Percentage Interest of each of PBSS and FMSS is 50% (as may be amended in accordance with the terms of this Agreement).

 “Person”: Any individual, corporation, association, partnership, limited liability company, joint venture, trust,
estate, or other entity or organization. 
 “Point Blank”: means Point Blank Solutions, Inc., a Delaware corporation.

 “Prime”: LaSalle Bank National Association (Chicago, Illinois) publicly announced prime rate in effect from time to time.

 “Recording Office”: The office of the Secretary of State of the State of Delaware. 
 “Regulation”: The income tax regulations, including any temporary regulations, from time to time promulgated under the Code. 

 

 A-4 

 “Remaining Capital Commitment”: As to each Member, on any date, the amount equal to the
positive excess, if any, of (a) such Member’s Capital Commitment, over (b) such Member’s aggregate Capital Contributions (excluding and disregarding for purposes of determining the amount in (b), such Member’s respective
Initial Contributions made by such Member to the Company in accordance with the provisions of Section 5.01). 
 “Supply
Agreement”: That certain Supply Agreement made by and between the Company and Point Blank dated March 18, 2008. 
 “Tax
Matters Partner”: That person required by Section 6231(a)(7) of the Code. 
 Each of the following terms is defined in the Section set
forth opposite such term: 
  

				
	 Term
	  	Section	 
	 Acceptance Notice
	  	10.03	(b)
	 Acting Member
	  	7.01	(c)(iii)
	 Additional Capital Contributions
	  	5.03	 
	 Additional Contribution Promissory Note
	  	5.04	(b)
	 Annual Budget
	  	7.01	(e)(iv)
	 Approved Budget
	  	7.01	(e)(iv)
	 Audited Financial Statements
	  	9.03	(c)
	 Available Cash
	  	6.03	 
	 Bank Accounts
	  	9.01	 
	 Board of Managers
	  	7.01	(a)
	 Breach
	  	11.01	(b)
	 Breaching Member
	  	11.01	(b)
	 Business
	  	Preamble	 
	 Call Exercise Notice
	  	10.05	(b)
	 Call Right
	  	10.05	(a)(iv)
	 Capital Account
	  	5.05	(a)
	 Capital Investment Loans
	  	5.07	(c)
	 CEO Meeting
	  	8.01	(a)(iii)
	 CEO Meeting Period
	  	8.01	(a)(iii)
	 Company
	  	Preamble	 
	 Continuing Member
	  	10.04	(a)(ii)
	 Controller
	  	7.02	(b)
	 Deadlock
	  	8.01	 
	 Deadlock Meeting
	  	8.01	(a)(i)
	 Deadlock Meeting Notice
	  	8.01	(a)
	 Deadlock Notice
	  	8.01	(a)(iv)
	 Deadlock Offer Price
	  	8.01	(c)
	 Default Amount
	  	5.04	(a)
	 Default Call Right
	  	10.05	(a)
	 Defaulting Member
	  	5.04	(a)
	 Distributions
	  	6.03	(e)

  

 A-5 

				
	 Drawdown
	  	5.02	(a)(i)
	 Effective Date
	  	Preamble	 
	 Event of Default
	  	5.04	(a)
	 First Member
	  	8.01	(b)(i)
	 First Offer
	  	10.03	(b)
	 First Refusal Offer Notice
	  	10.03	(a)
	 Fiscal Quarter
	  	9.03	(b)
	 Fiscal Year
	  	9.06	 
	 FMSS
	  	Preamble	 
	 FMSS COC Call Right
	  	10.05	(a)(ii)
	 FMSS Initial Cash Contribution
	  	5.01	(a)
	 FMSS Initial Loan
	  	5.07	(a)(i)
	 FMSS Intellectual Property
	  	13.01	(e)
	 FMSS Party
	  	10.05	(a)(iii)
	 Funding Notice
	  	5.02	(a)(i)
	 Indemnitee
	  	7.04	(a)
	 Initial Contribution
	  	5.01	 
	 Initial Loan
	  	5.07	(a)
	 Liens
	  	5.01	(a)
	 Member Dispute
	  	7.01	(c)(iii)
	 Meeting Notice
	  	7.01	(c)(iii)
	 Nonbreaching Member
	  	11.01	(b)
	 Non-Competitor Call Right
	  	10.05	(a)(iv)
	 Non-Defaulting Member
	  	5.04	(b)
	 Non-Proposing Member
	  	8.01	(a)(i)
	 Notice of Breach
	  	11.01	(b)
	 Offer
	  	10.03	(a)
	 Offer Notice
	  	8.01	(b)(ii)
	 Offer Period
	  	10.03	(b)
	 Offer Price
	  	10.03	(a)
	 Offer Recipient
	  	10.03	(a)
	 Offered Interests
	  	10.03	(a)
	 Offering Member
	  	10.03	(a)
	 PBSS
	  	Preamble	 
	 PBSS Call Rights
	  	10.05	(a)(iii)
	 PBSS COC Call Right
	  	10.05	(a)(ii)
	 PBSS Competitor Call Right
	  	10.05	(a)(iii)
	 PBSS Initial Cash Contribution
	  	5.01	(b)
	 PBSS Initial Loan
	  	5.07	(a)(iii)
	 Production Manager
	  	7.02	(c)
	 Products
	  	7.01	(e)(ix)
	 Proposals
	  	8.01	(a)
	 Proposing Member
	  	8.01	(a)(i)
	 Purchasing Member
	  	10.05	(b)
	 Restricted Period
	  	12.02	 
	 Second Member
	  	8.01	(b)(ii)

  

 A-6 

				
	 Securities Act
	  	13.01	(g)(i)
	 Selling Member
	  	10.05	(b)
	 Term
	  	10.05	(a)(ii)
	 Third Party
	  	10.03	(a)
	 Unresolved Proposal
	  	8.01	(a)(iii)
	 Withdrawing Member
	  	10.04	(a)(ii)

  

 A-7 

 ADDENDUM B 
 INITIAL BUDGET 
 [***] 
  

 B-1 

 ADDENDUM C 
 DIRECT COMPETITORS 
 [***] 
  

 C-1 

 ADDENDUM D 
 APPRAISERS 
 [***] 
  

 D-1

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00142-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00142-of-00352.parquet"}]]