Trade Compliance Requirements

1)   The Customer represents and warrants to ASSA ABLOY that it will always act in compliance with Economic Sanctions and Export Control Laws, and that:

a)    neither the Customer, its affiliates, or any of their respective directors, officers, employees nor, so far as the Customer is aware, any agents or other persons acting on behalf of any of the foregoing:

i)     is, or has been, a Listed Person;

ii)    has engaged in any business dealings or activities that would reasonably be expected to result in it becoming a Listed Person;

iii)   directly or indirectly, has conducted or is conducting any business dealings or activities with or for the benefit of, or is otherwise involved in any business with a Listed Person, or otherwise acting in violation of Economic Sanctions and Export Control Laws;

iv)  has engaged or is engaging in any transaction that circumvents, evades or avoids, or has the purpose or effect of circumvention, evading or avoiding, or attempts to violate, any Economic Sanctions and Export Control Laws; or

v)    is, or has been, in violation of, or subject to, any investigation or enquiry by, or on behalf of, any governmental or other regulatory body relating to Economic Sanctions and Export Control Laws.

2)   The Customer covenants, agrees and undertakes that:

a)    the Customer shall act in compliance with Economic Sanctions and Export Control Laws, and shall not sell nor re-export the Product without all requisite licenses and approvals under Economic Sanctions and Export Control Laws;

b)    the Customer shall not sell, export or re-export, the Product, directly or indirectly, to the Russian Federation or for use in the Russian Federation (whether or not permitted under Economic Sanctions and Export Control Laws applicable to the Customer);

c)    the Customer shall undertake its best efforts to ensure that the purpose of this Clause 2) is not frustrated by any third parties further down the commercial chain, including by possible resellers;

d)    the Customer agrees to (i) cascade the contractual obligations set forth in this Clause 2) in contracts with third parties, including possible resellers, further down the commercial chain; and (ii) set up and maintain an adequate monitoring mechanism to detect conduct by any third parties further down the commercial chain, including by possible resellers, that would frustrate the purpose of this Clause 2);

e)    the representations and warranties set forth in Clause 1) above shall always remain true and correct;

f)     the Customer will provide written notice to ASSA ABLOY, as promptly as possible and in any event within five business days, if (i) any representation or warranty set forth in Clause 1 above should cease to be true at any time, or (ii) the Customer should encounter any problems in applying Clauses a)- d), above, including any relevant activities by third parties that could frustrate the purpose of said clause; and

g)    the Customer will not engage in any transaction for Military End-Use unless explicitly approved by ASSA ABLOY.

3)   The Customer covenants, agrees and undertakes to maintain complete and accurate records concerning all actions taken by, on behalf of, or at the direction of ASSA ABLOY pursuant to these Trade Compliance Requirements. The Customer will provide all information relating to requests for Products, that the Customer suspects could violate or circumvent Economic Sanctions and Export Control Laws, including requests from or on behalf of a Listed Person, and other attempts to acquire ASSA ABLOY Products in violation of Economic Sanctions and Export Control Laws. The Customer will, to the best of its abilities, cooperate with ASSA ABLOY to facilitate compliance with Economic Sanctions and Export Control Laws and will upon ASSA ABLOY’s request provide ASSA ABLOY with true, complete and correct copies of all documentation relating to any business dealings involving the Product, including but not limited to, end-user certifications, information concerning compliance with the obligations under Clause 2) a)- d), and other information as may be required by ASSA ABLOY within two weeks of the simple request of such information.

4)   Anything in the Agreement to the contrary notwithstanding, ASSA ABLOY shall not be obliged to make any payment or take any other action under this agreement if ASSA ABLOY believes in good faith that such action may constitute a violation, contribute to a violation, or constitute a circumvention of any Economic Sanctions and Export Control Laws.

Termination:

5)   Supplementing any other termination rights in the Agreement into which these Trade Compliance Requirements are incorporated, the Agreement may be terminated immediately by ASSA ABLOY by written notice to the Customer if:

(a)  any representation or warranty set forth in Clause 1) above should cease to be true at any time;

(b)  the Customer acts in breach of its covenants, agreements and undertakings set forth in Clause 2)- 3) above, which shall in each case be deemed a material breach of an essential element of the Agreement;

(c)  the Customer has misrepresented or failed to properly disclose any material fact, or to provide any documentation, certifications or information requested by ASSA ABLOY, including without limitation to, the intended end-use/end-user or destination of the Product;

(d)  the Customer, its affiliates, or any of their respective directors, officers or employees becomes a Listed Person; or

(e)  either party’s ability to fulfil an obligation under this agreement is otherwise materially affected by the imposition of restrictions in Economic Sanctions and Export Control Laws.

Upon any such termination, the Agreement and all rights and obligations hereunder shall immediately terminate, provided that the Customer shall remain liable to ASSA ABLOY for any breach of its obligations hereunder.

ASSA ABLOY shall not be liable to the Customer for any claims, losses or damages arising from ASSA ABLOY exercising its rights under (a)(e) above or under Clause 4).

Penalty and Indemnification

6)   Any violation by the Customer of Clause 2) above shall constitute a material breach of an essential element of the Agreement, and ASSA ABLOY shall be entitled to seek appropriate remedies, including, but not limited to: (i) termination of the Agreement; and (iii) indemnification in accordance with Clause 7) below.

7)   The Customer shall indemnify ASSA ABLOY and its affiliates, directors, officers, employees, advisors, agents and holders of its equity interests (collectively, “Indemnitees”) against, and shall hold each Indemnitee harmless from, any and all third-party claims, damages and liabilities, including the reasonable fees, charges and disbursements of counsel, incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of:

a)    any misrepresentation or breach of warranty set forth in Clause 1 above;

b)    any breach by the Customer of any of its commitments in Clauses Clause 2)- 3) above; and

c)    any claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort, or any other theory.

Definitions for the purposes of these Trade Compliance Requirements:

“Military End-Use”: Use of Products, in their entirety or in part, for any military end-use or by any military end user, including for any purpose in connection with chemical, biological or nuclear weapons, military items or by any national armed services (army, navy, marine, air force, or coast guard), national guard and national police, government intelligence or reconnaissance organisations.

“Listed Person”: individuals and entities listed, or parties that are owned or controlled by one or more individuals or entities listed, in Economic Sanctions and Export Control Laws.

“Economic Sanctions and Export Control Laws”: all economic sanctions and export control laws, regulations, rules or restrictive measures, including but not limited to import and export restrictions on materials and items, adopted and enforced by governmental authorities of the EU, UK, UN or US or any other relevant governmental or regulatory authority, applicable to ASSA ABLOY or Customer.