Exhibit 10.5
FACILITIES AGREEMENT
This Facilities Agreement (this “
Agreement ”), is made as of July 10, 2007 (the “
Effective Date ”), by and between PCP Acquisition, Inc., a Colorado
corporation (the “ Company ”), and Perfect
Circle Projectiles, LLC, an Illinois limited liability company
(“ Seller
”).
1.
Background . This Agreement is entered into as
consideration for and as a condition to the closing of the
transactions contemplated by the Asset Purchase Agreement (the
“ Purchase
Agreement ”), dated as of the
Effective Date by and between the Company, Seller Gary E. Gibson
and Security With Advanced Technology, Inc.. The Company and Seller
have entered into certain other agreements in connection with the
Purchase Agreement, including, but not limited to, a Royalty
Agreement (the “ Royalty
Agreement ”) dated as of the
Effective Date by and between the Company and Seller. Unless
otherwise defined herein, capitalized terms used herein shall have
the meanings assigned to them in the Purchase Agreement and the
Royalty Agreement.
2.
Use of Facilities and Facilities
Reimbursement .
Commencing on the Effective Date and continuing
until the termination of this Agreement pursuant to Section 3 (the
“ Term ”), Seller shall produce Products for the Company at
Seller’s facilities as requested by the Company. During the
term, the Company shall reimburse Seller for all actual, direct and
incremental out-of-pocket costs incurred by Seller in producing
Products manufactured at Seller’s facilities for the Company.
Seller agrees to invoice the Company once per month for such
reimbursement of costs and the Company agrees to pay Seller within
30 days of receipt of Seller’s invoice.
3.
Termination. Either party may terminate this Agreement (a) upon 180
days’ written notice to the other party for any reason or no
reason at all or (b) upon 30 days’ written notice to the
other party due to such other party’s material breach of this
Agreement if such breaching party has not cured such breach to the
satisfaction of the non-breaching party within such 30-day period.
At any time during the Term that the Company is able to produce the
Products at its own facilities during the Term, the 180-day period
set forth in Section 3(a) shall be reduced to 120 days.
4.
Amendments . Any waiver, amendment, modification
or supplement of or to any term or condition of this Agreement
shall be effective only if in writing and signed by all parties
hereto.
5.
Severable . If any portion of this Agreement is
held to be invalid, the same will not affect in any respect
whatsoever the val
