Document:

Exhibit 10.25

 

EXECUTION VERSION

 

SEPARATION AGREEMENT

 

Agreement made this 28th day of March, 2013 (hereinafter referred to as the “Agreement”), between Daniel Glickberg (“Glickberg”), and Fairway Group Holdings Corp. (the “Company”).

 

W I T N E S S E T H :

 

WHEREAS, Glickberg has been employed with the Company and its subsidiaries (collectively, the “Fairway Group”) as a Vice President and has served as a director of the Company pursuant to an Employment Agreement between the Company and Glickberg, dated as of January 17, 2007 (the “Employment Agreement”) ; and

 

WHEREAS, as of the date of this Agreement, Glickberg owns 9,093 shares of common stock of the Company, 232 shares of Series A preferred stock of the Company and warrants to purchase 126 shares of common stock of the Company (collectively, “Glickberg’s Stock Holdings”); and

 

WHEREAS, as of the date of this Agreement, Glickberg is a party to various agreements with the Company, including but not limited to a Stockholders’ Agreement, dated January 18, 2007, a Securities Purchase Agreement, dated March 26, 2009, a Restricted Stock Agreement, dated January 18, 2007, and a Restricted Stock Agreement, dated April 20, 2011 (together with the Employment Agreement, the “Governing Agreements”); and

 

WHEREAS, Glickberg and the Company mutually agree to terminate the employment relationship under the Employment Agreement and such termination shall not be deemed to be a termination by the Company with “justifiable cause” or a termination by Glickberg without ‘good reason,” as such terms are defined in the Employment Agreement.

 

 

NOW, THEREFORE, in consideration of the premises and of the representations, promises and obligations herein contained, the parties hereto agree as follows:

 

1.             The parties agree that Glickberg’s employment with the Fairway Group will cease on the date hereof (the “Termination Date”) and that as of the Termination Date Glickberg is no longer an employee or officer of the Company or any other member of the Fairway Group.  The parties also agree that, as of the Termination Date, the Employment Agreement is no longer of any force or effect; provided, however, that Sections 9, 10, 11, 12 and 21 shall survive the termination of the Employment Agreement and remain in full force and effect, except that (i) the Non-Competition Period (as such term is defined in the Employment Agreement) shall extend for a period of five (5) years following the Termination Date and (ii) the territory covered by Section 9 shall be the East Coast of the United States (including without limitation Pennsylvania).

 

2.             Glickberg hereby resigns as a director of the Company effective as of the Termination Date

 

3.             The Company agrees to pay Glickberg a separation payment in an amount of $325,000, which is equal to his current annual base salary for approximately twenty-two months, less lawful deductions.  The separation payment will be paid to Glickberg in equal installments, on the Company’s regular pay days, for the twenty-two month period beginning on the Termination Date.

 

The Company will pay to Glickberg the bonus that he would have received pursuant to Section 3(b) of the Employment Agreement for the Company’s fiscal year ending March 31, 2013 (“FY13”), at the time FY13 bonuses are paid to other officers of the

 

2

 

Company, which bonus shall be calculated and paid in a manner consistent with all other similarly situated officers of the Company, but in no event shall be less than $60,000 or more than $75,000.  Upon consummation of the Company’s initial public offering (“IPO”) on or prior to December 31, 2013, the Company will pay Glickberg $145,000 as payment in full of the Liquidity Bonus (as such term is defined in the Employment Agreement) due pursuant to Section 3(c) of the Employment Agreement.

 

If Glickberg elects COBRA coverage, the Company will pay his COBRA continuation health coverage premiums (less the normal weekly employee contribution rate, the payment of which shall be Glickberg’s responsibility) for a period ending on the earlier of (i) March 28, 2015 or (ii) Glickberg becoming eligible to receive comparable medical coverage after securing employment.  Glickberg shall notify the Company upon becoming eligible to receive comparable medical coverage.

 

4.             Glickberg hereby agrees to sell to the Company, and the Company, in consideration of the extension of the Non-Competition Period set forth in the Employment Agreement, agrees to repurchase from Glickberg, 1,096 shares of the Company’s common stock (the “Shares”) for an aggregate purchase price of $1,500,000.  In connection with the sale of the Shares to the Company, Glickberg represents, warrants, acknowledges and agrees that:

 

(a)           the Company has filed a Registration Statement on Form S-1 under the Securities Act of 1933, as amended, with respect to a possible initial public offering of its shares of Common Stock;

 

(b)           he has relied upon independent investigations made by him or his representatives and he is fully familiar with the business, results of operations,

 

3

 

financial condition, prospects and other affairs of the Fairway Group and the proposed IPO;

 

(c)           in connection with the sale of the Shares hereunder, neither the Company, any director or officer of the Company nor anyone acting on their behalf or any other person has made, and he is not relying upon, any representations, statements or projections concerning the Fairway Group, its present or projected results of operations, its prospects, its present or future plans, its products, or the value of its shares or business or any other matter in relation to its business or affairs, or the ability to consummate, or the success of, the IPO;

 

(d)           he and his representatives have been given the opportunity to ask questions of and to receive answers from the Company regarding the business, results of operations, financial condition, prospects or other affairs of the Fairway Group and to obtain such other information as they desired in order to evaluate his decision to sell the Shares;

 

(e)           he is the sole record and beneficial owner of the Shares, and the Shares are not subject to any lien, claim, restriction or encumbrance or to any option or right (collectively, “Encumbrances”) that restricts him from transferring good and marketable title to the Shares to the Company, free and clear of any Encumbrances;

 

(f)            pursuant to that certain Registration Rights Agreement, dated as of January 17, 2007, by and among the Company, Glickberg and the other stockholders thereto, he will be obligated to enter into, and hereby agrees to enter into, any lockup or similar agreement required by the underwriters in any public offering of the Company’s securities; and

 

4

 

(g)           he has received professional advice from his counsel and his accountants regarding his sale of the Shares.

 

Payment for the shares being purchased pursuant to this Section 3 shall be made on March 29, 2013.

 

5.             In consideration of the extension of the Non-Competition Period set forth in the Employment Agreement, the Company agrees to permit Glickberg to sell, and Glickberg hereby agrees to sell, shares of Company common stock in the IPO having a value, based on the price to the public of the Company’s common stock in the IPO, of $1,500,000.  Glickberg will pay all underwriting discounts and commissions related solely and directly to the number of shares of the Company’s common stock he is selling in the IPO, as well as any fees and expenses of any counsel he engages in connection with the IPO, and shall be responsible for no further or additional expenses.  Glickberg acknowledges that in order to include shares in the Company’s IPO, he will be required to execute certain documents in favor of the Company, including without limitation a Custody Agreement and Power of Attorney, copies of which have been previously provided to Glickberg, and hereby agrees to execute all such documents and provide all such information that may be required by the Company or the underwriters in the IPO.

 

6.             On the Termination Date, Glickberg shall enter into the Voting Agreement attached hereto as Exhibit A.  Glickberg hereby requests that upon the consummation of the Company’s initial public offering, any shares of Class B common stock of the Company received by him in respect of his preferred stock be converted into shares of Class A common stock.

 

5

 

7.             Glickberg understands that, as of the Termination Date, he is no longer an employee of the Fairway Group, and that he is no longer entitled to participate in any employee benefit, discount or incentive plan maintained by the Fairway Group, including any medical, life or other insurance plan (except as allowed under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”) with respect to continuation medical coverage).  In addition, as of the Termination Date, Glickberg shall not hold himself out as being associated with the Fairway Group or any of its respective affiliates

 

8.             As a fundamental condition of this Agreement and the payments provided for herein, Glickberg shall comply fully with all of his obligations under Sections 9, 10 and 11 of the Employment Agreement (as modified by Section 1 above).  In addition, as a fundamental condition of this Agreement and the payments provided for herein, Glickberg also agrees not to directly or indirectly influence or attempt to influence any potential or current supplier, service provider, lender, investor or other person or entity with whom the Fairway Group does business or may engage to do business to modify, terminate or change the course of dealing or any written or verbal agreement that the Fairway Group has with such person or entity or take other action that would adversely impact the Fairway Group’s relationship with its suppliers, lenders or service providers.

 

9.             Glickberg represents that as of the Termination Date, he has returned all property of the Company, including but not limited to, any computers, VPN equipment, software, telephones, documents, books, records (whether in electronic format or hard copy), reports, files, correspondence, notebooks, manuals, notes, specifications, mailing lists, credit cards, access cards, identification cards, key fobs, keys and other data and/or materials in his possession or control.  Glickberg shall advise the Company of the amount of lease payments

 

6

 

remaining on the car currently leased by the Company through the end of the current lease term for Glickberg, and the Company shall promptly thereafter pay to the leasing company the remainder of the lease payments through its current lease term and the lease and all obligations thereunder shall be transferred to Glickberg and the Company shall have no further obligations thereunder.

 

10.          Glickberg, for himself and for the executors and administrators of his estate, his heirs, successors and assigns, hereby releases and forever discharges each member of the Fairway Group, its current and former subsidiaries and affiliates (including without limitation Sterling Investment Partners and its affiliated investment funds (collectively, “Sterling”)), and all of their respective officers, directors, managers, members, stockholders, employees, agents, attorneys, insurers and the respective executors, administrators, heirs, successors and assigns of the foregoing, from any and all claims, actions, causes of action, suits, sums of money, debts, dues, accounts, reckonings, bonds, bills, covenants, contracts, controversies, agreements, promises, demands or damages of any nature whatsoever or by reason of any matter, cause or thing regardless of whether known or unknown at present, which against any member of the Fairway Group, or any of their respective officers, directors, and employees Glickberg ever had, now has or hereafter can, shall or may have for, upon, or by reason of, any matter, cause or thing whatsoever from the beginning of the world to the date hereof including, but not limited to, any matter relating to or arising out of the employment of Glickberg or the termination thereof under any contract, tort, federal, state or local fair employment practices or civil rights law including, but not limited to, Title VII of the Civil Rights Act of 1964, as amended, the Americans with Disabilities Act, the Age Discrimination in Employment Act, the Older Workers Benefits Protection Act, the federal

 

7

 

Family and Medical Leave Act, the New York Executive Law, the Administrative Code of the City of New York, the Fair Labor Standards Act, or any claim for physical or emotional distress or injuries, invasion of privacy, defamation, claims relating to severance pay, wages, sick leave, vacation pay, life insurance, medical insurance, disability or any other benefit of employment, or any other duty or obligation of any kind or description, including any implied covenant of good faith and fair dealing, implied contract of permanent employment or the tortious or willful discharge of employment.  The parties also agree that this Agreement does not either affect the rights and responsibilities of the Equal Employment Opportunity Commission to enforce the Age Discrimination in Employment Act, or justify interfering with the protected right of an employee to file a charge or participate in an investigation or proceeding conducted by the Equal Employment Opportunity Commission under the Age Discrimination in Employment Act.  In the event the Equal Employment Opportunity Commission commences a proceeding against the Company in which Glickberg is a named party, Glickberg agrees to waive and forego any monetary claims which may be alleged by the Equal Employment Opportunity Commission to be owed to Glickberg.  The parties also agree that nothing in the provisions of this Section 10 is intended to limit their rights under and concerning enforcement of this Agreement.

 

11.          Glickberg agrees to keep confidential the terms of this Agreement and not to disclose any term of this Agreement to any other person or entity, except for Glickberg’s family, accountants and attorneys.  In the event that Glickberg is required by law to disclose any term of this Agreement, Glickberg agrees to give the Company ten days’ written notice prior to any such disclosure, or such shorter time period as mandated by law or is otherwise practicable.

 

8

 

12.          Glickberg shall not make any statements, either directly or through other persons or entities, which are disparaging to the Fairway Group or any of its affiliates (including without limitation Sterling), management, officers, directors, employees, agents, services, products, operations, prospects or other matters relating to the Fairway Group’s businesses.  In that regard, Glickberg shall not make or encourage others to make any statement or release any information that is intended to, or reasonably could be foreseen to, embarrass or criticize the Fairway Group or its affiliates, employees, managers, directors, officers, members or shareholders, individually or as a group.  The Fairway Group (including without limitation Sterling), through its officers and directors, shall not make any statements, either directly or through other persons or entities, which are disparaging to Glickberg.

 

13.          The Company agrees to indemnify and hold Glickberg harmless to the fullest extent permitted by applicable law and the Company’s by-laws arising out of any proceeding by reason of the fact that he was serving as a director or officer of any member of the Fairway Group.

 

14.          Glickberg hereby agrees that, in the event his testimony, services or time are required in the future to assist the Fairway Group in handling any legal matter, prosecuting or defending against litigation or to pursue or defend against a disputed claim or charge of any type, he will make himself reasonably available to work with Fairway Group’s attorneys and representatives, to prepare for and provide deposition and/or trial testimony and to take whatever other steps are necessary to assist in the handling of such legal matters and prosecution/defense of such claims.  Glickberg further agrees that he will make himself available to consult with Fairway Group’s management in connection with the transition of his business responsibilities as well as such other business matters that may be reasonably

 

9

 

requested by the Fairway Group. The Fairway Group will reimburse Glickberg for any reasonable travel expenses incurred by Glickberg on its behalf and at its advance written request in rendering assistance required by this Section 14, provided that Glickberg submits documentation in a form acceptable to the Fairway Group to substantiate such expenses.  Any such reimbursement shall be subject to the following rules:  (a) reimbursement shall be made promptly following submission of acceptable documentation and in no event later than the last day of the calendar year following the year in which the reimbursable expense was incurred; (b) the amount of expenses eligible for reimbursement during any calendar year shall not affect the amount of expenses eligible for reimbursement during any other calendar year; and (c) the right to reimbursement shall not be subject to liquidation or exchange for another benefit.

 

15.          Glickberg agrees that in the event he violates any provision of this Agreement in any material respect, the Company shall have the right to cease making all payments due pursuant to Section 3.  In addition, in the event Glickberg violates the provisions of Section 9 of the Employment Agreement (as modified by Section 1 hereof), the Company shall, in addition to any other remedy it may have at law or in equity, have the right to purchase all shares of Company common stock then owned by Glickberg at a price per share equal to seventy-five percent (75%) of the fair market value of the stock at the time of violation.

 

16.          The Company and Glickberg acknowledge and agree that, effective on the Termination Date, except as provided in Section 15 above, any right of the Company to repurchase any of Glickberg’s Stock Holdings pursuant to any of the Governing Agreements shall be null and void.

 

10

 

17.          The Company acknowledges and agrees that neither this Agreement nor the furnishing of the consideration identified in this Agreement and General Release, is, or shall be deemed or construed at any time to be, for any purpose, an admission by Glickberg of any guilt or noncompliance with any Federal, State, or Local Statue, Constitution, public policy, tort law, contract law, common law, or of any other wrongdoing, unlawful conduct, liability or breach of any duty or Company policy whatsoever.  To the Company’s knowledge, through the Termination Date, Glickberg has not engaged in, by either act or omission, any conduct that constitutes, or could be deemed to be, “justifiable cause,” as such term is defined in the Employment Agreement.  Glickberg represents that through the Termination Date he has not engaged in, by either act or omission, any conduct that constitutes, or could be deemed to be, “justifiable cause,” as such term is defined in the Employment Agreement.

 

18.          The Company has advised Glickberg to consult with an attorney prior to executing this Agreement.  By executing this Agreement, Glickberg acknowledges that (a) he has been provided an opportunity to consult with an attorney or other advisor of his choice and, in fact, has been represented by Thompson Hine LLP regarding the terms of this Agreement, (b) this is a final offer and Glickberg has been given twenty-one (21) days in which to consider whether he wishes to enter into this Agreement, (c) Glickberg has elected to enter this Agreement knowingly and voluntarily and (d) if he does so within fewer than twenty-one (21) days from receipt of the final document he has knowingly and voluntarily waived the remaining time.  The Company reserves the right to change or revoke this Agreement prior to Glickberg’s execution hereof.  This Agreement shall be fully effective and binding upon all parties hereto immediately upon execution of this Agreement.

 

11

 

19.          Any notice to be given hereunder shall be in writing and shall be deemed given when mailed by certified mail, return receipt requested, addressed as follows:

 

	
To Glickberg at:
    	
Daniel Glickberg
    
	
 
    	
220 East 72nd Street
    
	
 
    	
Apt. 25E
    
	
 
    	
New York, NY 10021
    
	
 
    	
 
    
	
With a copy to:
    	
Joseph B. Koczko
    
	
 
    	
Thompson Hine LLP
    
	
 
    	
335 Madison Avenue
    
	
 
    	
New York, New York 10017
    
	
 
    	
 
    
	
To the Company at:
    	
Fairway Group Holdings Corp.
    
	
 
    	
2284 12th Avenue
    
	
 
    	
New York, New York 10027
    
	
 
    	
Attn.: President
    
	
 
    	
 
    
	
With a copy to:
    	
Roy L. Goldman, Esq.
    
	
 
    	
Fulbright & Jaworski L.L.P.
    
	
 
    	
666 Fifth Avenue, 31st Floor
    
	
 
    	
New York, New York 10103
    

 

or at such other address as may be indicated in writing by any party to the other parties in the manner provided herein for giving notice.

 

20.          In the event that any one or more of the provisions of this Agreement is held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions will not in any way be affected or impaired thereby.  This Agreement will survive the termination of any arrangements contained herein and is binding on and will inure to the benefit of each of the parties and their respective affiliates, heirs, executors, administrators, successors and assigns.

 

21.          This Agreement shall be governed by the substantive laws of the State of New York, without giving effect to any principles of conflicts of law.

 

12

 

22.          Each of the parties agrees to do and perform or cause to be done and performed all further acts and shall execute and deliver all other documents necessary on its part to carry out the intent and accomplish the purposes of this Agreement and the transaction contemplated hereby.

 

23.          The parties agree that all claims between them (other than those seeking specific performance or other equitable relief) resulting from this Agreement shall be settled by arbitration as set forth in Section 21 of the Employment Agreement.

 

24.          This Agreement sets forth the entire agreement between the parties hereto concerning the subject matter hereof and may not be changed without the written consent of each of the parties.

 

13

 

EXECUTION VERSION

 

IN WITNESS WHEREOF, the parties have each executed this Agreement as of the date first written above.

 

	
 
    	
Fairway Group Holdings Corp.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By: 
    	
/s/ Herb Ruetsch
    
	
 
    	
Name: Herb Ruetsch
    
	
 
    	
Title: Chief Executive Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ Daniel Glickberg
    
	
 
    	
Daniel Glickberg
    

 

[SEPARATION AGREEMENT SIGNATURE PAGE]

 

 

Exhibit A

 

EXECUTION VERSION

 

VOTING AGREEMENT

 

This Voting Agreement (the “Agreement”) is made as of the 28th day of March, 2013, by and among Fairway Group Holdings Corp., a Delaware corporation (the “Company”), Daniel Glickberg (the “Stockholder”) and Sterling Investment Partners II, L.P. (the “Proxyholder”).

 

RECITALS

 

The Stockholder owns shares of Preferred Stock and Common Stock of the Company.  This Agreement, among other things, requires the Stockholder to vote all such shares of Preferred Stock and Common Stock and all shares of capital stock of the Company which such Stockholder currently owns or hereafter acquires or as to which he otherwise exercises voting or dispositive authority (together all such shares referred to in this sentence and any securities of the Company issued with respect to, upon conversion of, or in exchange or substitution of such shares, and any other voting securities of the Company subsequently acquired by the Stockholder, the “Shares”) in the manner set forth herein.  This agreement is being entered into in connection with that certain Separation Agreement, dated as of March     , 2013, between the Company and the Stockholder, and for other good and valuable consideration, the sufficiency of which is hereby acknowledged and agreed.

 

AGREEMENT

 

The parties agree as follows:

 

1.  Voting for the Election of Directors.  At each annual meeting of the stockholders of the Company, or at any meeting of the stockholders of the Company at which members of the Board of Directors of the Company are to be elected, or whenever members of the Board of Directors are to be elected by written consent, the Stockholder agrees to vote (in person, by proxy or by action by written consent, as applicable) with respect to all Shares so as to elect the members of the Board of Directors designated in writing by the Proxyholder.  At any meeting of the stockholders of the Company at which members of the Board of Directors of the Company are to be removed, or whenever members of the Board of Directors are to be removed by written consent, the Stockholder agrees to vote or act with respect to his Shares so as to remove any director designated in writing by Proxyholder.  Notwithstanding the foregoing or anything to the contrary contained herein, to the extent that Stockholder and Proxyholder are both parties to the Stockholders’ Agreement between the Company and certain stockholders of the Company, dated as of January 17, 2007, as amended from time to time (the “Stockholders’ Agreement”), Stockholder agrees to continue to be bound by the Stockholders’ Agreement and, to the extent that any provisions of this Agreement conflict with the provisions of the Stockholders’ Agreement regarding the election or removal of directors (the “Director Provisions”), the Director Provisions (including without limitation any proxies given with respect thereto) shall govern the election and removal of directors under this Agreement.  Proxyholder agrees to continue to be bound by the Stockholders’ Agreement and shall vote (to the extent Proxyholder holds a proxy) and otherwise act with respect to any Shares as and if required under the Stockholders’ Agreement.

 

2.  Voting Agreement On All Matters. Stockholder hereby agrees with respect to all Shares:

 

(a)     In the event that the Proxyholder instructs (or otherwise requests) that Stockholder vote in favor of any Acquisition (an “Approved Sale”), any Certificate Amendment and/or any Other Matter, then the Stockholder shall (i) after receiving proper notice of any meeting of stockholders of the Company to vote on the approval of an Approved Sale, a Certificate Amendment and/or Other Matter (or, if no notice is required or such notice is properly waived, after notice from the Proxyholder is given), be present, in person or by proxy, as a holder of Shares at all such meetings and be counted for the purposes of determining the presence of a quorum at such meetings and (ii) vote (in person, by proxy or by action by written consent, as applicable) all Shares as to

 

15

 

which the Stockholder has beneficial ownership or as to which he otherwise exercises voting or dispositive authority (A) in favor of such Approved Sale or Certificate Amendment, (B) in the case of an Approved Sale, in opposition to any and all other Acquisitions for which a vote is taken while an Approved Sale is still pending that would reasonably be expected to delay or impair the ability of the Company to consummate such Approved Sale, and (C) in the case of an Other Matter, in the manner directed by the Proxyholder.  Notwithstanding the foregoing, in the case of an Approved Sale, the Stockholder shall not be required to assume personal liability greater than the liability assumed by the Proxyholder that continues after the transaction closing for breach of representations, warranties or other obligations except (x) to the extent of the consideration received in the transaction or (y) for liability attributable to fraud or willful misconduct on the part of the Stockholder.  The Stockholder shall refrain from exercising any dissenters’ rights, appraisal rights or similar rights under applicable law at any time in connection with such Approved Sale.  If the Approved Sale is structured as a sale of the stock of the Company, then the Stockholder hereby agrees to sell and shall sell all of his Shares on the terms and conditions approved by the Proxyholder.  Subject to applicable laws, the Stockholder shall take all necessary and desirable actions approved by the Proxyholder in connection with the consummation of the Approved Sale, including the execution of such agreements and such instruments and other actions reasonably necessary to (i) provide the representations, warranties, indemnities, covenants, conditions, escrow agreements and other provisions and agreements relating to such Approved Sale, and (ii) effectuate the allocation and distribution of the aggregate consideration upon consummation of the Approved Sale.

 

(b)     In the event that the Proxyholder instructs (or otherwise requests) that Stockholder vote against any Acquisition (a “Rejected Sale”), any Certificate Amendment and/or any Other Matter, then the Stockholder shall (i) after receiving proper notice of any meeting of stockholders of the Company to vote on the Rejected Sale, such Certificate Amendment and/or Other Matter (or, if no notice is required or such notice is properly waived, after notice from the Proxyholder is given), be present, in person or by proxy, as a holder of Shares at all such meetings and be counted for the purposes of determining the presence of a quorum at such meetings and (ii) vote (in person, by proxy or by action by written consent, as applicable) all Shares as to which the Stockholder has beneficial ownership or as to which he otherwise exercises voting or dispositive authority (A) against such Rejected Sale or Certificate Amendment, and (B) in the case of an Other Matter, in the manner directed by the Proxyholder.  If the Rejected Sale is structured as a sale of the stock of the Company, then the Stockholder shall not sell any of his Shares unless permitted to sell in writing by the Proxyholder.

 

(c)      Stockholder agrees that, unless Proxyholder provides explicit written instruction to vote Stockholder’s Shares under this Agreement or Proxyholder provides explicit written notice that Stockholder shall be permitted by Proxyholder to vote in a manner other than as Proxyholder instructs, Stockholder shall abstain from voting any of his Shares (in person, by proxy or by action by written consent, as applicable) on all matters.

 

(d)     In the event of any Transfer by the Stockholder, (i) the Stockholder shall inform the Company and the Proxyholder of such Transfer and (ii) unless such Transfer is a sale into the public market, the pledgee, transferee or donee shall furnish the Proxyholder and the Company with a written agreement to be bound by the provisions of this Agreement.  Such Transfer shall not be valid unless and until the Company and the Proxyholder receive such written agreement.  In the event of any Transfer by the Stockholder, the Stockholder shall inform the Company and the Proxyholder of such Transfer no less than five (5) business days prior to such Transfer.  Such pledgee, transferee or donee shall be treated as a “Stockholder” for purposes of this Agreement.  For avoidance of doubt, unless such Transfer is a sale into the public market the Company shall not permit the Transfer of any of the Shares on its books or issue new certificates representing any such Shares unless and until the person(s) to whom such Shares are to be transferred shall have executed the written agreement referred to in this Section 2 and any additional agreement required under any other applicable agreements between the parties hereto.

 

For purposes of this Section 2:

 

“Acquisition” shall mean any (i) event that results in a liquidation, dissolution or winding up, or is deemed to be a liquidation, dissolution or winding up of the Company, under the Company’s Amended and Restated Certificate of Incorporation, as the same may be amended from time to time (the “Certificate”), (ii) Sale of the Company (as that term is defined in the Stockholders’ Agreement) or (iii) reorganization, consolidation, merger, stock sale or asset sale of the Company.

 

16

 

“Certificate Amendment” shall mean any amendment of the Certificate.

 

“Other Matter” shall mean any matter, action, ratification or other event other than an Acquisition or Certificate Amendment for which approval of the holders of the Company’s stock is sought (either by vote or written consent) or upon which such holders are otherwise entitled to vote or consent.

 

“Transfer” shall mean and include any sale, assignment, encumbrance, hypothecation, pledge, conveyance in trust, gift, transfer by bequest, devise or descent, or other transfer or disposition of any kind, including, but not limited to, transfers to receivers, levying creditors, trustees or receivers in bankruptcy proceedings or general assignees for the benefit of creditors, whether voluntary or by operation of law, directly or indirectly, of any of the Shares.

 

3.  Irrevocable Proxy and Power of Attorney.  To secure the Stockholder’s obligations to vote the Shares in accordance with this Agreement and to comply with the other terms hereof, the Stockholder hereby appoints the Proxyholder, or his designees, as such Stockholder’s true and lawful proxy and attorney, with the power to act alone and with full power of substitution, to vote or act by written consent with respect to all of such Stockholder’s Shares in accordance with the provisions set forth in this Agreement, and to execute all appropriate instruments consistent with this Agreement on behalf of such Stockholder.  The proxy and power granted by the Stockholder pursuant to this Section are coupled with an interest and are given to secure the performance of such party’s duties under this Agreement.  Each such proxy and power will be irrevocable for the term hereof.  The proxy and power, so long as any party hereto is an individual, will survive the death, incompetency and disability of such party or any other individual holder of the Shares and, so long as any party hereto is an entity, will survive the merger, consolidation, conversion or reorganization of such party or any other entity holding any Shares.

 

4.  Additional Representations, Covenants and Agreements.

 

4.1     No Revocation.  The voting agreements contained herein are coupled with an interest and may not be revoked during the term of this Agreement.

 

4.2     Legends. The Company shall cause each certificate representing shares of the Company’s capital stock held by the Stockholder or any assignee of the Stockholder to bear the following legend:

 

“THE SHARES EVIDENCED HEREBY ARE SUBJECT TO A VOTING AGREEMENT BY AND AMONG THE COMPANY, THE HOLDER OF THE SHARES EVIDENCED HEREBY AND THE PROXYHOLDER (A COPY OF WHICH MAY BE OBTAINED FROM THE COMPANY) WHICH INCLUDES PROVISIONS POTENTIALLY RESTRICTING THE HOLDER’S RIGHT TO VOTE OR TRANSFER HIS OR ITS ENTIRE INTEREST IN THE SHARES EVIDENCED HEREBY, AND BY ACCEPTING ANY INTEREST IN SUCH SHARES THE PERSON ACCEPTING SUCH INTEREST SHALL BE DEEMED TO AGREE TO AND SHALL BECOME BOUND BY ALL THE PROVISIONS OF SAID VOTING AGREEMENT.”

 

4.3     Stock Splits, Dividends, Etc.  In the event of any issuance of Shares of the Company’s voting securities hereafter to any of the parties hereto (including, without limitation, in connection with any stock split, stock dividend, recapitalization, reorganization, or the like), such shares shall automatically become subject to this Agreement and shall be endorsed with the legend set forth in Section 4.2.

 

4.4     Specific Enforcement.  It is agreed and understood that monetary damages would not adequately compensate an injured party for the breach of this Agreement by any party, that this Agreement shall be specifically enforceable, and that any breach or threatened breach of this Agreement shall be the proper subject of a temporary or permanent injunction or restraining order.  Further, each party hereto waives any claim or defense that there is an adequate remedy at law for such breach or threatened breach.

 

4.5     Securities Rules and Regulations.  The Stockholder agrees and understands that the Stockholder, the Company and/or the Proxyholder may become subject to the registration and/or reporting

 

17

 

requirements, rules and regulations of the Exchange Act of 1934, as amended, the Securities Act of 1933, as amended, and/or any state and federal securities laws (collectively, the “Securities Laws”).  Stockholder agrees to use his best efforts to comply with the Securities Laws and to assist Proxyholder in complying with the Securities Laws in a timely and prompt manner.  Such compliance may include, for example and without limiting the foregoing, the filing and updating and maintaining of Form 13G and/or Form 13D under the Exchange Act of 1934, as amended.

 

4.6     Proxyholder’s Liability.  The Proxyholder shall not be liable for any error of judgment nor for any act done or omitted, nor for any mistake of fact or law nor for anything which the Proxyholder may do or refrain from doing in good faith, nor shall the Proxyholder have any accountability hereunder, except for his own bad faith, gross negligence or willful misconduct.  Furthermore, upon any judicial or other inquiry or investigation of or concerning the Proxyholder’s acts pursuant to his rights and powers as Proxyholder, such acts shall be deemed reasonable and in the best interests of the Stockholders unless proved to the contrary by clear and convincing evidence.

 

5.  Termination.

 

5.1     Termination Events.  This Agreement shall terminate upon the earlier of:

 

(a) The liquidation, dissolution or winding up of the business operations of the Company;

 

(b) The execution by the Company of a general assignment for the benefit of creditors or the appointment of a receiver or trustee to take possession of the property and assets of the Company;

 

(c) In the sole discretion of the Proxyholder, with the express written consent of the Proxyholder (which he shall be under no obligation to provide); or

 

(d) The Stockholder no longer owning any Shares.

 

5.2     Removal of Legend.  At any time after the termination of this Agreement in accordance with Section 5.1, any holder of a stock certificate legended pursuant to this Agreement may surrender such certificate to the Company for removal of the legend, and the Company will duly reissue a new certificate without the legend.  The Company and the Proxyholder agree that upon a sale by the Stockholder of any Shares into the public market, the Company will reissue a new certificate in the name of the purchaser without the legend.

 

6.  Miscellaneous.

 

6.1     Successors and Assigns.  The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties.  Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.  Except for an assignment by the Company by operation of law or in connection with an Acquisition (which shall be permitted with only the written consent and notice of the Company), this Agreement may not be assigned by the parties without the written consent of the Proxyholder, the Company and the Stockholder, except that the Proxyholder may assign this Agreement to any of its affiliates (including without limitation one or more members of its general partner).

 

6.2     Amendments and Waivers.  Any term hereof may be amended or waived only with the written consent of the Stockholder and the Proxyholder, except where such amendment or waiver shall materially negatively alter the rights or obligations of the Company hereunder, in which case any such amendment or waiver shall also require the written consent of the Company.  Any amendment or waiver effected in accordance with this Section 6.2 shall be binding upon the Company, the Proxyholder and the Stockholder, and each of their respective successors and assigns.

 

18

 

6.3     Notices.  Notwithstanding anything to the contrary contained herein, any notice required or permitted by this Agreement shall be in writing and shall be deemed sufficient and received on the earlier of (a) the date of delivery, when delivered personally, by overnight mail, courier or sent by electronic mail (e-mail), telegram or fax, or (b) forty-eight (48) hours after being deposited in the U.S. mail, as certified or registered mail, with postage prepaid, and addressed to the party to be notified at such party’s address or fax number as set forth on the signature page hereto, or as subsequently modified by written notice.  Any electronic mail (e-mail) communication shall be deemed to be “in writing” for purposes of this Agreement.

 

6.4     Severability.  If one or more provisions of this Agreement are held to be unenforceable under applicable law, the parties agree to renegotiate such provision in good faith.  In the event that the parties cannot reach a mutually agreeable and enforceable replacement for such provision, then (a) such provision shall be excluded from this Agreement, (b) the balance of the Agreement shall be interpreted as if such provision were so excluded and (c) the balance of the Agreement shall be enforceable in accordance with its terms.

 

6.5     Governing Law; Jurisdiction; Venue.  This Agreement and all acts and transactions pursuant hereto and the rights and obligations of the parties hereto shall be governed, construed and interpreted in accordance with the laws of the State of Delaware, without giving effect to principles of conflicts of law.  In addition, each of the parties hereto (a) consents to submit itself to the exclusive personal jurisdiction of the Court of Chancery or other courts of the State of Delaware in the event any dispute arises out of this Agreement or any of the transactions contemplated by this Agreement, (b) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from such court, (c) agrees that it will not bring any action relating to this Agreement or any of the transactions contemplated by this Agreement in any court other than the Court of Chancery or other courts of the State of Delaware and (d) to the fullest extent permitted by law, consents to service being made through the notice procedures set forth in Section 6.3.  Each party hereto hereby agrees that, to the fullest extent permitted by law, service of any process, summons, notice or document by U.S. registered mail to the respective addresses set forth in Section 6.3 shall be effective service of process for any suit or proceeding in connection with this Agreement or the transactions contemplated hereby.

 

6.6     Counterparts.  This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument.

 

6.7     Titles and Subtitles.  The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

 

6.8     Counsel to the Stockholder.  Stockholder represents to the Company and Proxyholder that he had been represented by Thompson Hine LLP in connection with this Agreement.

 

[Signature Page(s) Follow(s)] 

 

19

 

The parties hereto have executed this Voting Agreement as of the date first written above.

 

	
FAIRWAY GROUP HOLDINGS CORP.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
BY:
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
Address: 
    	
2284 12th Avenue
    	
 
    
	
 
    	
 
    	
New York, New York 10027
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
STERLING INVESTMENT PARTNERS II, L.P.
    	
 
    
	
BY: STERLING INVESTMENT   PARTNERS MANAGEMENT II, L.P.,
    
	
ITS GENERAL PARTNER
    	
 
    
	
BY: STERLING INVESTMENT   PARTNERS MANAGEMENT II, LLC,
    
	
ITS GENERAL PARTNER
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
BY:
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
Address: 
    	
285 Riverside Avenue
    	
 
    
	
 
    	
 
    	
Westport, CT 06880
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
DANIEL GLICKBERG
    	
 
    
	
Address:
    	
 
    

 

20Security Devices International Inc.: Exhibit 10.2 - Filed by newsfilecorp.com

Exhibit 10.2

DEVELOPMENT, SUPPLY AND
MANUFACTURING AGREEMENT 

This Agreement, with an effective date upon endorsement by both
parties, is entered into between Security Devices International, Inc., a
Delaware corporation with an address of 1101 Pennsylvania Ave NW, 6th Floor,
Washington, DC 20004 ("SDI") and Micron Products, Inc., a Massachusetts
corporation with an address of 25 Sawyer Passway, Fitchburg, MA 01420
("Micron"). SDI and Micron are sometimes referred to collectively as the
"parties" and individually as a "party". 

In consideration of the mutual promises and undertakings set
forth herein, the parties hereto agree as follows: 

1. PRODUCTS. As used in this Agreement,
"Products" or "Product" shall mean 40MM assemblies and components for use by SDI
to produce less-lethal and training projectiles as described on attached
Exhibit A. It is also understood that additional products, regardless of
caliber, may be added to this Agreement by appendix, with the written approval
of both parties.

2. TERM. This Agreement shall commence upon the
effective date hereof and shall continue for a period of five (5) years. The
term of this Agreement shall automatically extend for an additional one (1) year
period commencing on the expiration date of the then-current term unless either
party has provided written notice of termination prior to such date. 

3. PURCHASE AND SALE. 

A. SDI shall order and purchase only from Micron the Products
identified in Exhibit A and Exhibit B during the term of this Agreement. 

B. Micron shall sell all SDI's Products to SDI on an exclusive
basis during the term of this Agreement.

C. Micron shall also be responsible for establishing and
maintaining the necessary quality systems (see attached Exhibit C)
manufacturing capacity and tooling necessary to meet SDI’s entire product
requirements, as described on Exhibit A during the term of this
Agreement. 

4. PRICES AND PRICE ADJUSTMENTS. Prices for the
Products shall be as set forth in attached Exhibit B and may be adjusted
for additional performance requirements in the marketplace. Any price
adjustments will be reviewed and agreed to by SDI and Micron before being
applied. Pricing shall also be subject to fluctuations in market price of raw
materials and energy costs. Micron shall give SDI ninety (90) days written
notice of any market price fluctuations or changes as described herein above,
including reasoning and a full description thereto. 

5. ORDERING AND SHIPPING. 

A. SDI must place written orders for Products under this
Agreement. Orders will be confirmed within two (2) working days by Micron's
written acknowledgment, the terms of
which will be binding upon SDI, provided, however, that where the terms and conditions of Micron's acknowledgment are inconsistent with provisions of this Agreement, the provisions of this Agreement shall control.  Micron shall deliver Product in
accordance with the time requested as set forth in SDI's purchase order and any releases against the purchase order, provided, Micron receives at least ten (10) business days lead time.  

Page 1 of 8 

B. All prices are FOB Fitchburg, MA, USA. Method and route of shipment will be at the discretion of SDI. All shipments shall be at SDI's risk and shall be insured, if at all, solely at SDI's expense. Micron reserves the right to make delivery in
installments and all such installments when separately invoiced shall be paid for when due per invoice, without regard to the date or subsequent deliveries.

6. PAYMENT. 

A. Payment terms are net thirty (30) days from date of invoice. All invoices shall be rendered in duplicate, shall state purchase order number, item numbers and any applicable taxes. A bill of lading or express receipt will accompany each invoice.
Invoices will also be supplied electronically to SDI via email, and a confirmation sent back to Micron via email upon receipt by SDI.

B. SDI agrees to pay for the Products and any shipping or other charges in full on the terms set forth in Micron's invoice or other documents. In addition to all other remedies Micron has under applicable law, in the event of SDI's default, Micron
shall have the option to charge interest on overdue balances at the rate of one (1%) percent per month. SDI shall also pay all of Micron's costs of collection including without limitation, attorney's fees. If, in Micron's opinion, the financial
condition or actions of SDI at any time indicate that payment for goods ordered may not be received, Micron may discontinue shipment and require payment in advance. 

7. FORECASTS. 

A. Each calendar quarter, SDI will provide Micron with a non-binding, written, confidential, good faith forecast of SDI’s purchases of Products from Micron during the following twelve (12) month period. These forecasts are to be best estimates
of anticipated purchases and not a commitment to purchase the quantities specified. Micron may use the forecasts to help plan production; however, Micron assumes all risk of use of such forecasts in connection with such planning. 

B. Quarterly, SDI will provide Micron with their proposed, written forecast of SDI’s purchase of Products from Micron during the following three (3) months.

8. WARRANTIES AND INDEMNIFICATIONS. 

A. Micron warrants that all Products will be free from defects in materials and workmanship. Micron makes no other warranty of any other kind, express or implied, of merchantability, fitness for any particular purpose or otherwise.  Micron's
obligations hereunder shall be limited to the replacement of defective Products or, at the option of Micron, the reimbursement of the original purchase price of the Products. Any claims of defective material or workmanship must be made in writing
and delivered to Micron
within one hundred and twenty (120) days from the date of receipt. Micron shall have no other obligation or liability of any kind. Micron must initiate investigative measures and perform corrective actions, if required and report all findings in
writing to SDI. Micron and SDI agree and understand that the price stated for the Products herein is consideration for the limitation of Micron's liability for a breach of the above-described express warranties and that such limitation represents a
valid and reasonable allocation of commercial risk between the parties. In no event shall Micron be liable for any indirect, incidental or consequential damages of SDI or any third party. This paragraph states SDI's sole and exclusive remedy for
breach of warranty. 

Page 2 of 8 

B. The maximum liability, if any, of Micron for all direct damages, including without limitation contract damages and damages for injuries or death to persons or property, whether arising from Micron's breach of this agreement, breach of warranty,
negligence, strict liability, product liability, use or misuse of Product by end users, or other tort with respect to the goods, or any services in connection with the goods, is limited to an amount not to exceed the price of the particular
Products. In no event shall Micron be liable to SDI for any direct, incidental, consequential, or special damages, including without limitation lost revenues and profits, even if Micron has been advised of the possibility of such damages.

9. INDEMNIFICATION. Notwithstanding any actual or alleged defects or hazard inherent in the Products or negligence of Micron, its agents, employees or Subcontractors or end users, SDI agrees to hold Micron and its affiliates, officers
and directors harmless and indemnify each of them against any and all loss, cost, damage or liability paid or incurred by them: (a) from third party claims for personal injuries, death or property damage, whether direct or indirect actual or
alleged, consequential or otherwise; (b) from any recall, inspection, testing, replacement or correction of the Products, whether required by governmental authority or otherwise; (c) from the violation of any law, regulation, rule, order or
restriction of any governmental authority resulting from or incident to the sale and/or delivery of the Products to SDI; or (d) from any actual or alleged infringement of any United States or foreign patent, copyright or similar common or civil law
right of a third party resulting from or incident to the sale and/or delivery of the Products to SDI and from any costs of defense, attorney's fees, inspector's fees and/or costs of testing for which any of them become responsible or which are borne
by any of them incident to any of the foregoing. 

10. TERMINATION.

A. SDI shall have the right to terminate this Agreement if Micron fails to perform in accordance with this Agreement and its appendices and fails to cure such default within sixty (60) days of written notice. Micron shall have the right to terminate
this Agreement on written notice to SDI if SDI (a) has failed to make any payments required by this Agreement in the time provided therefore and (b) following sixty (60) days’ notice of such failure from Micron, SDI does not pay all delinquent
sums in full. 

B. In addition to their respective rights set forth in this section, either party shall have the right to terminate this Agreement on written notice to the other party under the following circumstances: 

i. by mutual Agreement; 

Page 3 of 8 

ii. by written communication giving ninety (90) days notice; 

iii. if the other party materially defaults in the performance of any material obligation hereunder, and such default continues for more than sixty (60) business days after receiving written notice from the other party of such default; provided,
however, there shall be no default under this provision if the defaulting party has cured the default within sixty (60) days after the giving of notice; 

iv. in the event that the other party is declared insolvent, or bankrupt by a court of competent jurisdiction, or a voluntary petition of bankruptcy is filed in any court of competent jurisdiction by such other party, or such other party shall make
or execute an assignment for the benefit of creditors, or a receiver is appointed by a court of competent jurisdiction over all or a substantial portion of the other party’s assets and such receivership is not dismissed within 30 days of
appointment. 

11. CONFIDENTIAL INFORMATION.  “Confidential Information” means, without limitation, all information pertaining to the business of SDI and Micron including, but not limited to, the Product invention, ideas, trade secrets,
know-how, research and development, training, software, programs, hardware configuration information, price lists, data, manuals, handbooks, sponsors, investors, business strategies and plans, marketing, sales records, drawings, specifications,
designs, materials, parts lists, customer lists, consumer information, suppliers, contract terms, test criteria, vendor lists, financial information, intellectual property, and all other information or data of any kind or character relating to the
business of SDI or Micron, including but not limited to, any invention, writing, idea, discovery, or improvement made or conceived by SDI or Micron directly or indirectly as a result of performing work for SDI pursuant to this Agreement, whether or
not reduced to writing, and which is not generally available to the public. However, Confidential Information shall not include any of the foregoing, which has become publicly known and made generally available through no wrongful act of Micron or
any third party. Prior to execution of this Agreement; the parties have executed the Mutual Nondisclosure Agreement attached hereto as Exhibit D. In the event there is a conflict between the terms of the Mutual Nondisclosure Agreement and
this Agreement, this Agreement shall govern. 

Page 4 of 8 

12. TECHNOLOGY OWNERSHIP. The parties agree as follows: 

A. Except as stated in Section 12.B, SDI shall own all proprietary rights to the Product which shall be defined as:  all inventions, improvements, discoveries, designs, data, concepts, ideas, processes, methods, techniques, know-how, and
information, including schematics, and engineering drawings respecting the Product made or produced by Micron during the course of performing design, engineering, fabrication or manufacturing services under this Agreement, or made or produced as the
result of the joint efforts of SDI and Micron pursuant to this Agreement.

B. Notwithstanding anything to the contrary in this Agreement, Micron shall own all of its “Technology and Manufacturing Processes” used in the manufacture and assembly of the Products, whether those processes are conceived, acquired or
produced by Micron prior to or during the course of performing design, engineering, fabrication or manufacturing services under this Agreement.  Micron's “Technology and Manufacturing Processes” include:  proprietary electronic technology,
assembly and manufacturing processes, and related technology or know-how or information including concepts, techniques, schematics, and engineering drawings.  To the best of SDI's knowledge, SDI has not helped conceive, develop or modify any of
Micron's “Technology and Manufacturing Processes.” 

C. Notwithstanding anything to the contrary in this Agreement, Micron can design, engineer, fabricate or manufacture products embodying or using Micron’s Technology and Manufacturing Processes; provided that such products do not embody or use
any of SDI’s confidential information or the Products.

13. MANUFACTURING.

A. During the term of this Agreement, Micron shall timely manufacture the Product in compliance with the Product Specifications described in Exhibit A (the “Product Specifications”). Both during the term and following termination of
this Agreement, in perpetuity, Micron shall not supply the Product (or any prototype thereof), or Product Specifications, to any third party whatsoever. SDI shall not manufacture the Product by itself, and SDI shall not request the production of the
Product other than with Micron, during the term of this agreement. 

B. During the term of this Agreement, Micron shall exclusively manufacture for SDI the Product and any improved version of the Product; and SDI shall purchase only from Micron the Product and any improved version of the Product. 

14. NOTICES.  All notices or other communications to a party required or permitted hereunder shall be in writing and shall be given by FedEx addressed to the parties at the following addresses, or to an address later noticed: 

Page 5 of 8 

	 	If to Micron: 	If to SDI: 
	 	  	  
	 	Micron Products, Inc. 	Security Devices International, Inc. 
	 	25 Sawyer Passway 	1101 Pennsylvania Avenue NW 
	 	Fitchburg, MA 01420 	6th Floor 
	 	USA 	Washington, DC 20004 
	 	Attn: President 	Attn: President 

All notices shall be deemed given on the day when actually
delivered. 

15. CHANGE OF CONTROL. In the event that SDI is
acquired or merges with another organization, whereby, directly or indirectly,
control in excess of 50% of the Company or all or substantially all of its
business or assets is acquired by a third party in a sale or exchange of stock,
merger or consolidation, sale of assets or other similar transaction and the
successor corporation desires to be released from this contract, the following
shall apply: SDI or the successor corporation will not pay any additional
expenses other than the balance of any Non-Recurring Engineering NRE (if any)
and the purchasing cost for any outstanding purchase orders at that time. 

16. REGULATORY APPROVALS. SDI shall undertake and
be responsible for the procurement of any and all regulatory approvals and/or
registrations and customs approval necessary for the sale of the Product. Micron
shall aid and cooperate with, where appropriate, SDI in fulfilling the
responsibilities set forth in this paragraph. 

17. PUBLIC RELEASE OF INFORMATION. Any public
statement, verbal or written, regarding the other party shall be approved by the
other party in advance. The foregoing shall not prevent either party from
issuing a press release or making a public filing where required by law. 

18. FORCE MAJEURE. Any delays in or failure by
either party in performance of any obligations hereunder shall be excused for a
period up to sixty (60) if and to the extent caused by occurrences beyond such
party's reasonable control, including, but not limited to, labor strikes,
fire, floods, war, governmental regulation, or delay in or inability to obtain
labor, machinery, material or services through its usual and regular
sources.

19. INJUNCTIVE RELIEF. Each party hereby
expressly acknowledges and agrees that any breach or threatened breach by a
party of any of the terms set forth in Section 11 hereof may result in
significant and irreparable damage to the other party. Therefore, in addition to
any other remedies available at law, each party shall be entitled to injunctive
or other equitable relief by a court of appropriate jurisdiction in the event of
any breach or threatened breach of the terms of Section 11 of this Agreement.

20. RELATION OF PARTIES. Nothing herein shall be
deemed to constitute Micron and SDI as partners, joint ventures or otherwise
associated in or with the business of the other. SDI is an independent
contractor and neither party shall be liable for any debts, torts, accounts,
obligations or other liabilities of the other party, its agents or employees.
Neither party is authorized to incur debts or other obligations, nor to make
representations or warranties of any kind, on the part of or as agent for the
other except as may be specifically authorized in writing. It is expressly
recognized that no fiduciary relationship exists between the parties. 

Page 6 of 8 

21. APPLICABLE LAW. This Agreement shall be governed by and construed in accordance with the laws of The Commonwealth of Massachusetts without giving effect to any conflict-of-laws provisions thereof.  Any action, suit or proceeding
arising under this Agreement shall be brought in the U.S. District Court for the District of Massachusetts, to whose jurisdiction (including in personam) both parties consent. The parties hereby agree that any related ruling by a court (in
the USA) shall be the fullest extent possible by any court outside the USA. 

22. MISCELLANEOUS.

A. Test Results:  Micron agrees to provide to SDI quality control test results and a certificate that the Products delivered meet the Product Specifications.

B. Records:  Micron shall maintain records to demonstrate conformance to the requirements of SDI. All records will be retained so that they are readily retrievable in facilities that provide a suitable environment to prevent damage,
deterioration, and loss. Records will be kept on an active file for a minimum time of five years. Records will be kept at Micron’s facility and will be made available to SDI upon written notice fourteen (14) days in advance. 

C. Severability: If any provision of this Agreement is determined to be invalid, illegal or enforceable by a federal court, such provision shall be deemed to be severable from the remainder of this Agreement, and shall not cause the
invalidity, illegality or unenforceability of the remainder of the Agreement.

D. Assignment.  Except as specifically set forth below, or in Section 15 above, this Agreement may not be assigned by either party, without the prior written consent of the other party. No assignment shall relieve the assigning party of its
obligations hereunder. Notwithstanding the foregoing sentence, either party may assign its interests in this Agreement to any of its Affiliates or to any third party that acquires all or substantially all of its business, without the prior written
consent of the other party.  As used herein, "Affiliate" means, with respect to a party, any person or entity that controls, is controlled by or is under common control with such party. An entity is deemed to be in control of another entity
(controlled entity) if the former owns directly or indirectly at least fifty percent (50%), or the maximum percentage allowed by law in the country of the controlled entity, of the outstanding voting equity of the controlled entity. 

E. Non-waiver: The exercise by either party of any remedy or recourse available to it hereunder shall not deprive such party of any other remedy or recourse available to it under applicable law. Any waiver by either party of a breach of any
term of this Agreement shall not be considered as a waiver of any subsequent breach of the same or other terms or condition hereof. 

Page 7 of 8 

F. Entire Agreement: This Agreement constitutes the
entire agreement between SDI and Micron with respect to the subject matter of
this Agreement and supersedes any prior agreements or understandings with
respect to such subject matter. This Agreement may only be amended by a writing
signed by all the parties. 

IN W1TNESS WHEREOF, the parties hereto have caused this
Agreement to be executed, under seal, as of the date first written above. 

	SECURITY DEVICES INTERNATIONAL INC. 		MICRON PRODUCTS, INC. 
	 	 	 
	By:                                                                             
      	 	By:                                                                             
      
	 	 	 
	Title:                                                                          
      	 	Title:                                                                          
      
	 	 	 
	Date:                                                                          
      	 	Date:                                                                          
      

Page 8 of 8

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00215-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00215-of-00352.parquet"}]]