1.    Acceptance

The following are the Terms and Conditions upon which Sensorex Corporation (“Seller”) agrees to sell and deliver its products to Buyer.  No contract for sale shall be formed until Seller issues a Sales Order Acknowledgement in response to Buyer’s order.  Provisions and conditions of Buyer’s order which are in any way inconsistent with or in addition to the provisions of these Terms and Conditions shall be inapplicable and not be binding upon Seller unless specifically agreed to by Seller in a supplemental writing signed on behalf of Seller by the appropriate authorized representative.  Orders are non-cancelable after Seller’s Sales Order Acknowledgment.

2.    Delivery, Transfer of Title and Risk of Loss

Seller will deliver all products to Buyer INCOTERMS 2012 FCA carrier at Seller’s plant.

3.    Changes

Seller reserves the right to make changes, without notice, to the products, or components thereof, to be delivered under any contract entered into pursuant to these Terms and Conditions.  Seller further reserves the right to make changes to Seller’s documents (drawings, test procedures, etc.) which describe the products, or components or parts thereof, without notice.  Buyer shall not have rights of concurrence or approval unless Seller specifically agrees in writing.  Seller reserves the right to change pricing for the product without notice.

4.    Payment

Seller shall submit invoices on the date of shipment.  Partial invoices may be submitted for partial shipments.  Terms are Net 30 days from date of invoice.  Late payments are subject to the lower of a 1.5% per month late charge or the maximum rate of interest allowable by law.  All payments shall be made in U.S. Dollars.

5.    Warranty

Seller warrants, for a period of 1 year from date of manufacture, that goods of its own manufacture shall be free of defects in materials and workmanship under normal use and service, provided they are maintained in accordance with Seller’s instructions.  At its option, Seller will either repair or replace goods that are found to be defective within the warranty period.  Replacement parts will be delivered F.O.B. shipping point, and Seller may require the return of allegedly defective parts, freight prepaid, to establish the warranty claim.  The warranty is applicable only if (a) the defect occurred under normal use and service; (b) the defect arose from faulty workmanship or materials; (c) Buyer notified Seller in writing of the defect within 10 days of its discovery by Buyer; and (d) the goods are properly employed in the use for which they are intended and maintained in accordance with any applicable Seller operation and service manuals.  The warranty provided will be void if the goods:  (a) were repaired or serviced by a service facility which was not authorized by Seller; (b) utilize replacement parts not manufactured by Seller; or (c) were modified in a manner not approved by Seller.  Any warranties provided on goods not manufactured by Seller are assigned to Buyer, without recourse to Seller, at the time of delivery.  Any descriptions, drawings, samples or similar materials used in connection with any sale are for the sole purpose of identifying the goods and are not to be construed as a warranty that the goods will conform to such description.  BUYER, IN ACCEPTING THE DELIVERY OF THE GOODS, ACKNOWLEDGES THAT SELLER MAKES NO OTHER WARRANTIES OR REPRESENTATIONS WITH RESPECT TO THE GOODS, EXPRESS OR IMPLIED, AND SELLER DISCLAIMS THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.  IN NO EVENT SHALL SELLER BE LIABLE FOR ANY INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES INCLUDING, BUT NOT LIMITED TO LOSS OF USE OR DOWNTIME, WHICH ARISE FROM DEFECTS IN THE GOODS. SELLER’S TOTAL LIABILITY UNDER THIS SECTION 5 SHALL BE LIMITED TO SELLER’S PURCHASE PRICE FOR THE DEFECTIVE GOODS.

6.    Patents

Seller agrees to indemnify Buyer for any monetary damages and costs finally awarded against Buyer in any non-appealable judgment determining that any products manufactured and furnished to Buyer by Seller, in the form delivered to Buyer by Seller, when properly used in the United States in accordance with Seller’s service manuals, bulletins and instructions, infringe upon any United States patent belonging to any third person; provided that Seller is given prompt written notice of any and all claims or threatened claims of infringement and full control of the defense and settlement of such claims (with the assistance and cooperation of Buyer  as requested).  Seller shall not be liable to indemnify Buyer for any damages and costs arising out of patent infringement if the infringement arises out of compliance with Buyer’s specifications, or from a combination with, and addition to, or a modification of the products after delivery by Seller or from use of goods, or any part thereof, in the practice of a process.  The foregoing states Seller’s sole liability, and Buyer’s sole remedy, for infringements of the intellectual property rights of others by Seller’s products.

7.    Limitation of Liability

(a)   EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED IN SECTIONS 5 AND 6, IN NO EVENT SHALL SELLER BE LIABLE FOR ANY INCIDENTAL, SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES RESULTING FROM ANY REASON WHATSOEVER.  THIS EXCLUSION APPLIES TO ALL LEGAL THEORIES UNDER WHICH DAMAGES MAY BE SOUGHT AGAINST SELLER UNDER THESE TERMS AND CONDITIONS.

(b)  THE CUMULATIVE LIABILITY, IF ANY, OF SELLER FOR DIRECT DAMAGES ARISING UNDER ANY PROVISION OF THESE TERMS AND CONDITIONS OR ANY CONTRACT ENTERED INTO PURSUANT HERETO AND UNDER ANY THEORY OF LIABILITY WITH RESPECT TO THE PRODUCTS IS LIMITED TO AN AMOUNT NOT TO EXCEED THE PRICE PAID BY BUYER FOR THE PARTICULAR PRODUCTS GIVING RISE TO THE LIABILITY.  THE RIGHT TO RECOVER DAMAGES WITHIN THE LIMITATIONS SPECIFIED IN THIS SECTION 7 IS BUYER’S EXCLUSIVE ALTERNATIVE REMEDY IN THE EVENT ANY OTHER CONTRACTUAL REMEDY FAILS IN ITS ESSENTIAL PURPOSE.

8.    Confidential and Proprietary Information

(a)  Each of Buyer and Seller shall use the other’s Confidential Information solely for the purpose of fulfilling its obligations under these Terms and Conditions and any contract entered into pursuant hereto and shall not disclose any such Confidential Information to any third party other than as may be specifically authorized by the disclosing party in writing.  Buyer and Seller shall take reasonable steps to protect the other’s Confidential Information including, without limitation, by restricting disclosure of such Confidential Information only to those persons who have a “need to know” and who are subject to similar confidentiality undertakings.  Each of Buyer and Seller shall use at least as much care in the protection of the other’s Confidential Informa­tion as it uses to protect its own trade secrets.  “Confidential Information” means all non-public information, documents and materials provided by one party to the other before or after the date of the order including, without limitation, specifications, prices, sales data, research and development, information regarding costs and know-how.  The term Confidential Information shall not include information that (A) is or becomes publicly available without breach of this Section 8 or (B) was known to the receiving party at the time of disclosure, as demonstrated by files in existence at the time of disclosure.

(b)  Seller retains all rights of ownership to all designs, developments and tooling provided or developed by Seller in performance of any contract entered into pursuant to these Terms and Conditions, whether or not nonrecurring payments have been made by Buyer and whether or not the form of such payments was a lump sum or amortized.

(c)  Buyer shall not, nor shall it permit others to, (i) reverse engineer, disassemble or otherwise derive any intellectual property embedded in the products; (ii) modify, tamper with or create derivative works of the products or any intellectual property embedded in the products or integrate or incorporate them with or into any other items; or (iii) strip out or alter any trademark, service mark, copyright, patent, trade secret, ownership or any other proprietary or intellectual property notices on or within the product.

9.    Compliance with Laws

(a)  Generally, Buyer shall comply with all United States and foreign laws, regulations and other governmental requirements applicable to the exportation, importation, sale and use of the products, in particular, without limitation, the UK Bribery Act 2010, U.S. Foreign Corrupt Practices Act 1977, and the UN Convention Against Corruption.

(b)  Buyer shall ensure that all parties with which it is associated or who are providing goods or services in connection with any contract governed by these Terms and Conditions (including subcontractors, agents, consultants and other intermediaries) are aware of and comply with the requirements of this Section 9.

(c)  On reasonable request, Buyer shall confirm in writing to Seller that it has complied with the requirements of this Section 9 and, if so requested, allow Seller to verify this compliance by way of an audit of Buyer’s records.

(d) Buyer will indemnify, keep indemnified and hold harmless Seller against all costs, expenses and losses that Seller may incur or suffer as a result of any breach by Buyer of any of its obligations under this Section 9. This indemnity will not apply to any fine levied on Seller as a result of Seller’s criminal liability.

(e)  If Buyer breaches these Terms and Conditions, Seller shall have the right to terminate any contract governed by these Terms without notice and with immediate effect and will be in no way liable to Buyer in respect of such termination for payment of damages or any other form of compensation.

10.  Modifications and Waivers

No modifications or amendment of these Terms and Conditions shall be binding on Seller unless made in a written instrument signed by both Seller and Buyer.  A waiver of any breach of these Terms and Conditions, the acceptance of any order inconsistent with these Terms and Conditions or the making of deliveries pursuant to such order shall not be deemed a modification of these Terms and Conditions.

11.  Force Majeure

Seller will not be in default with respect to these Terms and Conditions or any contract entered into pursuant hereto because of any failure or delay if the failure or delay is the result of any act of God, act of any government in either its sovereign or contractual capacity, fire, flood, epidemic, quarantine restriction, strike, freight embargo, severe weather condition, civil commotion, war or war-like operation, act of terrorism, invasion, rebellion, hostilities, military or usurped power, sabotage or any other cause beyond the reasonable control of Seller.

12.  Severability

If any provision of these Terms and Conditions or the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of these Terms and Conditions, and the application of such Terms and Conditions to persons or circumstances other than those to which such provision is held invalid or unenforceable, shall not be affected thereby and all remaining provisions of these Terms and Conditions shall be valid and shall be enforced to the fullest extent permitted by law.

13.  Attorneys’ Fees and Other Fees and Court Costs

The party prevailing in any litigation arising from a dispute between the parties with respect to any contract entered into by Seller and Buyer incorporating these Terms and Conditions shall be entitled to reasonable attorneys’ fees, expert witness fees and all related legal, expert witness and court costs.

14.  Applicable Law; Jurisdiction and Venue; Waiver of Jury Trial

(a) These goods are purchased in California (without regard to its conflicts of laws rules) and this purchase is governed by California law as provided herein.

(b) Each of the parties hereto acknowledges that it is subject to exclusive jurisdiction before all courts for the State of California and the United States District Court for the Central District of California and agrees that no proceeding respecting any dispute regarding the interpretation of these Terms and Conditions or purchase of products pursuant to these Terms and Conditions shall be commenced in any other court.

(c) Each of the parties hereto hereby agrees that venue of any dispute regarding the interpretation of the provisions of these Terms and Conditions or the purchase of products pursuant to these Terms and Conditions shall be proper before the Superior Court of the State of California, County of Orange, or the United States District Court for the Central District of California, and hereby waives any right that such party may have to object to such venue or to seek to transfer the venue of such dispute to any other court on the basis that such court would be a more convenient forum.

(d) In the event of a dispute as to the provisions of these Terms and Conditions or purchase of products pursuant to these Terms and Conditions, both parties agree to waive a right to trial by jury.