General Terms of Sale

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1. Definitions
   1. "Agreement” – These general terms of sale together with the Purchase Order and all other attachments specified in them.
   1. “Customer” – The entity who addresses the Purchase Order, as specified in the Agreement. For the sake of the Agreement, Customer shall include its agencies, representatives, affiliated companies, subcontractors, vendors and successors as well.
   1. "Deliverables" – Shall mean collectively the Products and the Services as detailed herein and shall be interpreted according to the applicable and relevant meaning.
   1. “Delivery Point” – Agreed location of deliverance of the Deliverables to Customer or its forwarder, which shall be also detailed in the Purchase Order.
   1. "Effective Date” – Date by which the Agreement becomes effective upon its signature and Approval by both Parties.
   1. "General Terms of Sale" – these General Terms of Sale.
   1. “Parties” – Customer and SCD.USA.
   1. “Party” – Customer or SCD.USA as the case may be.
   1. “Price” – Price of Deliverables to be paid to SCD.USA by the Customer under the Agreement, as set out in the Purchase Order.
   1. "Price Proposal" – The Price Proposal provided to Customer by SCD.USA in connection with the Agreement.
   1. “Products” – The goods specified in the Purchase Order which SCD.USA is required to deliver under the Agreement as detailed and agreed upon in the Spec, or any part thereof.
   1. "Purchase Order" – A Specific Purchase Order, provided by Customer to SCD.USA in accordance with the Agreement.
   1. "SCD.USA" – SemiConductor Devices- An Elbit Systems – Rafael Partnership.
   1. "Services" – The specified and agreed work which SCD.USA is required to perform under the Agreement, as detailed in the SOW, or any part thereof.
   1. "SOW" – The agreed statement of work.
   1. "Spec" – The agreed technical specification.

• General
  • These General Terms of Sale apply to all Price Proposals made by SCD.USA and all purchase orders for SCD.USA's Deliverables provided by SCD.USA to its customers, unless otherwise agreed upon in writing.
  • SCD.USA shall, pursuant to and in accordance with the provisions of the Agreement, provide to Customer the Deliverables as defined herein and Customer, pursuant to and in accordance with the provisions of the Agreement, pay SCD.USA in accordance with the agreed prices and terms of payment as detailed in the Agreement.
  • Conflicts

In the event of conflict in the terms and conditions as detailed in the documents of the Agreement, the following order of precedence shall apply:

• A Purchase Order issued by Customer and duly approved by SCD.USA
  • The Price Proposal
  • The most recent and applicable Spec
  • The SOW
  • These General Terms of Sale

• Acceptance of Purchase Orders
  • Unless subsequently negotiated or otherwise agreed upon, Purchase Orders from Customer shall be solely based on SCD.USA's Price Proposal and the prices, quantities and schedules specified in it.
  • Only Purchase Orders that SCD.USA accepts and confirms in writing to Customer shall bind SCD.USA and SCD.USA shall have no obligation to accept Purchase Orders from Customer.
  • SCD.USA shall provide Customer with SCD.USA's approval, rejection and/or reservation to a Purchase Order.

• Delivery
  • SCD.USA shall deliver the Deliverables according to the agreed terms and schedule as detailed in the Price Proposal or otherwise agreed upon ("Delivery") and in accordance with the rules of Incoterms 2010 edition. In the event of any contradiction between the Agreement and the Incoterms the terms and conditions of the Agreement shall apply.
  • Unless otherwise agreed upon by the Parties, Delivery Point shall be FCA Ben Gurion International Airport, Israel.
  • Early delivery up to 2 (two) months from the original delivery date is allowed subject to prior notification from SCD.USA to Customer.
  • Deliverables shall be packed and in the best commercial manner normally used by SCD.USA for shipment of the same kind of Deliverables, or as agreed in the Agreement, whichever applicable.
  • Title to the Deliverables shall pass upon Delivery. However, SCD.USA shall maintain security interest in the delivered Deliverables until full and final payment is received from Customer. Risk of loss of or damage to the Deliverables shall pass to Customer upon Delivery.
  • All the delivered Deliverables shall be free and clear of any and all liens, encumbrances or any other claims of any nature whatsoever.

• Acceptance Tests
  • SCD.USA shall perform acceptance tests at SCD.USA's facilities on all the Deliveries according to SCD.USA's custom and relevant acceptance test procedures ("ATP").
  • Acceptance certificate of conformance ("COC") signed by SCD.USA's authorized Quality Assurance representative shall serve as final proof that the Deliverables passed all relevant acceptance tests and are ready to be delivered to Customer according to the agreed requirements of the Agreement.
  • Customer may, at its option and sole cost and expense, observe the formal testing of the Deliverables at SCD.USA’s facility on a non-interference basis, in accordance with SCD.USA’s security procedures and solely upon prior coordination with SCD.USA. However, in no event shall SCD.USA be delayed in its testing schedule because of Customer’s inability to provide the appropriate personnel to witness testing.

• Warranty
  • Subject to the provisions set forth in the Agreement, and unless otherwise detailed in SCD.USA's Price Proposal and if not, agreed upon by the Parties and specified in the Purchase Order, SCD.USA hereby warrants that for a period of 12 (Twelve) months from Delivery ("Warranty Period"), all Deliverables shall be free from defects in materials and workmanship and shall conform to the requirements of the Spec.
  • Acceptance and rejection of Deliverables
    • Within 5 (five) working days from Delivery, Customer shall notify SCD.USA in writing of acceptance or rejection of the Deliverables. If Customer did not notify SCD.USA of accepted or rejected deliverables within 5 (five) working days, the delivered Deliverables shall be automatically deemed unconditionally accepted by Customer.
    • In case of rejected Deliverables solely due to non-conformance with the agreed specification, SCD.USA will be responsible for reasonable transport costs from Customer to SCD.USA at the Delivery Point and back to Customer at the Delivery Point. Customer will notify SCD.USA prior to shipping any Deliverables back to SCD.USA and shall request and obtain from SCD.USA a Return Material Authorization ("RMA") number.
    • SCD.USA shall replace or repair at SCD.USA's option rejected Deliverables which are demonstrated to SCD.USA's satisfaction to have been at the time of delivery to Customer, defective in material or workmanship or not in conformance with the Spec.
  • Rejection of Deliverables during the Warranty Period
    • Defective Deliverables returned by Customer to SCD.USA during the Warranty Period which are demonstrated to SCD.USA's satisfaction to be defective in material or workmanship under the provided warranty shall be repaired or replaced by SCD.USA and at SCD.USA's option. SCD.USA will be responsible for reasonable transport costs for the defective Deliverables from Customer to SCD.USA at the Delivery Point and back to Customer at the Delivery Point. Customer will notify SCD.USA prior to shipping any Deliverables back to SCD.USA and shall request and obtain from SCD.USA a RMA number.
    • During the Warranty Period, SCD.USA shall provide the repaired or replacement Deliverables to Customer, within an agreed Turn-Around-Time ("TAT") of SCD.USA's receipt of the defective Deliverables under a Warranty claim.
    • The Warranty Period of the repaired or replaced units shall be for the remaining original Warranty Period of the Deliverables.
  • Outside the Warranty Period, SCD.USA shall provide repaired or replacement units of Deliverables to Customer, subject to the terms of a separate agreement to be mutually agreed-upon and signed between the Parties.
  • SCD.USA shall not be responsible nor bear any costs of Customer or of any third party relating to removing Deliverables or any part of them from and installing/reinstalling a replacement/repaired Deliverables in Customer's equipment.
  • SCD.USA shall have no obligation under this Warranty Article unless the applicable Deliverables have been installed, operated, handled, maintained and stored in accordance with the current recommendations of SCD.USA as stated in its manuals and/or other written instructions provided to Customer, and as long as the Deliverables conform with all the specifications which were provided to SCD.USA by Customer in connection with production of the Deliverables and provided that said items have not been subject to accident, abuse, misuse or misapplication, negligence, neglect, alteration or repairs have been attempted by any party other than SCD.USA or SCD.USA’s authorized representatives, non-conformities that result from Customer's design or process, improper handling or not authorized performance, testing, installation, operation or use or any defects or claims caused by acts not performed by SCD.USA, acts or omissions of Customer or third parties or by combination of the Deliverables with additional ones.
  • The extent of SCD.USA's liability shall not exceed the cost of repairing or replacing any defective part/s, to the extent and in the manner expressly set forth in the foregoing provisions of this article.

• Changes
  • Unless otherwise expressly provided herein, the Agreement may be amended only by a written and agreed upon agreement which is duly signed by authorized representatives of both Parties.
  • Notwithstanding any other provision in this Agreement, a Party who desires to make any engineering changes in the Deliverables which may affect their contractual fit, form, function, logistics, configuration, technical requirements, safety or production ("Class I Change"), shall notify the other Party in writing of the nature of the proposed change.
  • Within 30 (thirty) days of receipt of such notice from Customer regarding a Class I Change, SCD.USA shall provide Customer with an estimation of the effect of such change, including time table adjustments. The Parties shall then enter into negotiations to establish the equitable adjustment to be made to the Individual Order, and if agreement is reached, a formal written change order relating thereto shall be signed, and the Parties shall forthwith comply with such change order.
  • SCD.USA has the right to request Class I Changes to the Deliverables. Such requests shall explain the reasons for the changes and their expected effects. Customer shall respond to SCD.USA's request within 14 (fourteen) days. Following receipt of Customer's approval SCD.USA shall have the right to implement the changes.
  • With respect to engineering at final product level (including acceptance test procedure – ATP), in case of changes which do not affect contractual fit, form, function, logistics, configuration, technical requirements, safety or production of the Deliverables ("Class II Change") SCD.USA will notify Customer on the details of the Class II Changes. If Customer's Objection to the required Class II Changes is not provided within 7 (seven) days, SCD.USA shall be free to implement the changes, provided that such changes are based on SCD.USA's good faith determination that such changes will not degrade reliability or performance.
  • Any and all other changes, including inter alia changes in time tables and delivery shall be requested and agreed upon in writing. Each Party shall respond in writing to the other Party's request for a change.
  • All agreed upon changes taken into count shall be properly updated, signed and documented as an amendment to the Agreement by the Parties.

• Liability
  • NOTWITHSTANDING ANYTHING ELSE IN THE AGREEMENT OR IN ANY AGREEMENT, OR IN ANY PURCHASE ORDER ISSUED PURSUANT HERETO, OR OTHERWISE, AND EXCEPT FOR BODILY INJURY, NEITHER PARTY SHALL BE LIABLE OR OBLIGATED WITH RESPECT TO THE SUBJECT MATTER OF THE AGREEMENT OR UNDER ANY OTHER AGREEMENT, TRANSACTION, NEGLIGENCE, STRICT LIABILITY OR OTHER LEGAL OR EQUITABLE THEORY FOR (I) ANY MATTER BEYOND ITS REASONABLE CONTROL; (II) ANY INCIDENTAL, INDIRECT, SPECIAL, EXEMPLARY, PUNITIVE, OR CONSEQUENTIAL DAMAGES OF ANY KIND (INCLUDING WITHOUT LIMITATION LOST PROFITS, LOST REVENUES AND LOSS OF USE, OPPORTUNITY, MARKET POTENTIAL AND GOODWILL), EVEN IF IT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH COSTS OR DAMAGES AND REGARDLESS OF THE LEGAL THEORY UNDERLYING ANY ASSERTION OF SUCH LIABILITY.
  • IN NO EVENT SHALL SCD.USA'S LIABILITY REGARDLESS OF THE LEGAL THEORY UNDERLYING SUCH CLAIMS, EXCEED THE TOTAL VALUE OF PAYMENT SCD.USA ACTUALLY RECEIVED FROM CUSTOMER PURSUANT TO THE APPLICABLE PURCHASE ORDER.

• Impropriety
  • Either Party shall abstain from directly or indirectly offering and/or giving and/or receiving any benefit or anything of value in order to change or influence in an improper manner, directly and/or indirectly, any decision of any person, entity or government authority, in connection with the Agreement or any Purchase Order placed consequent thereto.
  • The Parties shall comply with all applicable law, ordinance or regulation and shall make all efforts to avoid involvement in legal proceedings which may prejudice or harm the Deliverables or either Party and its good name.
  • The Parties shall neither directly or indirectly solicit or participate up to any extent in any form of bribery, corruption, criminal behavior, infringement of labor laws or any other applicable law, ordinance or regulation, improper solicitation or unethical business behavior.
  • Customer shall conduct its activities pursuant to this Agreement in a manner that will reflect favorably on SCD.USA, and shall avoid any deceptive or corrupt or misleading practice.
  • Customer will not make or promise to make any payment in violation of any applicable law or regulation. The foregoing prohibition shall include but not be limited to facilitating, recommending or interceding, officially or unofficially, to further contract award with a "Recipient". A Recipient is defined as: any person whatsoever, including without limitation: (i) any Government Official; or (ii) any person or individual whether self-employed or acting as an individual, or whether employed by, affiliated with, representing or acting on behalf of any private sector entity; or (iii) any person while knowing or suspecting that the payment or gift will be passed on to any other person, including without limitation a Government Official.
  • Each Party shall notify the other Party immediately after it becomes aware of any infringement of the provisions the Agreement or the possibility of one.
  • Each Party shall inform its relevant employees, subcontractors and anyone on its behalf acting under the Agreement of its provisions, and to enforce its full compliance.

1. Proprietary Rights and Confidentiality
   1. "Proprietary Information" as used herein means any and all information, including confidential information, disclosed by one Party to the other, its employees, agents and assigns, whether in oral, written, graphic or machine-readable form, or whether visually obtained, before or after signature of the Agreement relating to the Deliverables, and including all derived information thereof, such as but not limited to copyrights, patents, trademarks, sketches, planning documents, software (including source code), instructions and procedures relating to development, production, assembly, quality control, maintenance, operation and production regardless of form (such as magnetic media).
   1. Proprietary Information, or any part thereof, whether capable of being copyrighted, patented, or otherwise registered at law or not are for the purposes of the Agreement acknowledged by the recipient Party as being the sole property of the disclosing Party, or which otherwise should reasonably be construed under the circumstances as being confidential or of proprietary nature except to the extent such information: (i) is known to the recipient Party at the time it is disclosed, other than by previous disclosure by or on behalf of the disclosing Party or any of their employees, researchers or students, as evidenced by the receiving Party’s written records at the time of disclosure; (ii) is or becomes known to the public through no fault of the recipient Party; (iii) is lawfully and in good faith becomes available to the recipient Party by a third party who is not subject to obligations of confidentiality to the disclosing Party with respect to such information; or (iv) is independently developed by the recipient Party without the use of or reference to the disclosing Party's Confidential Information, as demonstrated by documentary evidence; (v) is disclosed to SCD.USA's subcontractors, subject to equivalent confidentiality obligations, if such disclosure is required for SCD.USA in order to fulfill its obligations under the Agreement.
   1. The recipient Party shall keep the Proprietary Information in confidence and exercise at least the same degree of care and protection as the recipient Party takes to preserve its own proprietary information. Without the prior written approval of the disclosing Party, the recipient Party shall not use, duplicate or disclose, or permit the use, duplication or disclosure by the recipient Party’s employees, agents or assigns, or by any other person, in any manner or form whatsoever, of the Proprietary Information, in whole or in part, other than for the sole purpose of the performance of the Agreement and only to employees and consultants of the receiving Party who have a “need to know” such information in order to enable the recipient Party to exercise its rights or fulfill its obligations under this Agreement and are legally bound by agreements which impose confidentiality and non-use obligations comparable to those set forth in this Agreement. The above provisions shall remain in force and effect throughout the period in which the recipient Party is actively engaged in performance under the Agreement and for a period of 7 (seven) years thereafter.
   1. Unless otherwise expressly specified and notwithstanding any other provision in the Agreement, all Proprietary Information and All patent rights, copyrights, designs, trade secrets, know-how, ideas, proprietary information, confidential information, inventions, technical data, and other intellectual property related information or materials and other industrial or rights owned by either Party will continue to be owned by such Party and concerning Deliverables developed by SCD.USA in connection with the Agreement shall remain vested with SCD.USA.
   1. If the Parties hold a valid and relevant Non-Disclosure Agreement ("NDA"), the terms of the NDA shall supersede the terms of the Agreement with the exception that the longer remaining period for the confidentiality obligations shall prevail.
   1. The Provisions of this article shall survive the termination or expiration of the Agreement.

1. Prices
   1. Prices for all Deliverables shall be as specified in SCD.USA's Price Proposal attached to the Agreement.
   1. Unless otherwise agreed, prices of all Deliverables hereunder are net and exclusive of all applicable taxes including, but not limited to, purchase taxes and value added taxes, import duties, fees, excises, and/or charges which are now or may hereafter be directly imposed on SCD.USA with respect to sale of the Deliverables, or on the Agreement itself. All applicable taxes shall be borne by Customer and If SCD.USA is required by law to directly pay any such taxes, fees, excises, and/or charges, Customer shall promptly reimburse SCD.USA upon SCD.USA’s presentation to Customer of a receipt acknowledging such payment.

1. Third Party Rights
   1. To the best of SCD.USA's knowledge the Deliverables are free from third-party rights such as copyrights and/or property rights, in particular patent, utility patent and design patent rights, which have not been lawfully acquired by SCD.USA.
   1. In the event that any party claims or threatens to claim infringement, SCD.USA shall defend the Customer from finally adjudicated judgments, provided that the Customer informs SCD.USA immediately of the claim, assists SCD.USA in the defense of the claim and provides SCD.USA with the sole control of the defense and settlement of the claim. SCD.USA, at its sole discretion, may modify the Deliverables so that they are not infringing, procure the right to use the Deliverables or request the return of the Deliverables for refund of the purchase price.
   1. SCD.USA is not responsible for infringement caused by integration of the Deliverables with another apparatus or component or modifications to the Deliverables.
   1. The terms in this article shall serve as Customer's sole and exclusive remedy in any matter of infringement from any kind of third party rights.

1. Development, Non-Recurring Engineering Fees and Prototypes
   1. SCD.USA and Customer may agree upon development of new Deliverables and prototypes or modification or adaptation of existing Deliverables by SCD.USA ("Development").
   1. In the event Customer pays non-recurring engineering fees (“NRE”) for SCD.USA's efforts to develop prototypes or novel Deliverables, such development, same as any other modification or adaptation requested by Customer, shall be subject to these General Terms of Sale unless otherwise expressly agreed upon by both Parties and Customer acknowledges that all Deliverables and prototypes are developed and provided strictly “as is,” with no warranties, either expressed or implied, including without limitation any implied warranties of merchantability, non-infringement and fitness for use, and, notwithstanding anything to the contrary in the Agreement, SCD.USA shall have no liability of any kind relating to the development, failure to develop, functionality, lack of functionality, or performance of any Deliverables or Prototype.
   1. Unless otherwise agreed upon and without derogating any of the provisions of this Agreement, any and all Development or NRE shall not produce any proprietary right in the Deliverables or any part thereof, and all Proprietary rights including all Intellectual Property rights whatsoever shall remain vested with SCD.USA and no license to use or right is granted to Customer thereon.

1. Terms of payment
   1. Terms of Payment shall be as agreed upon and set out in SCD.USA's Price Proposal or Price Agreement attached to the Agreement. Payment shall be made via wire transfer unless otherwise agreed upon.
   1. Unless otherwise explicitly agreed upon, Terms of Payment are net 30 (thirty) days from receipt by Customer of the applicable invoice from SCD.USA.
   1. All payments due from Customer to SCD.USA pursuant to the Agreement shall be made in freely transferable USD.

1. Export Control
   1. The Parties shall comply with all relevant and applicable export control or other laws and regulations.
   1. SCD.USA shall be responsible to procure a valid Export License if required, and Customer shall be responsible to procure a valid Import License, if required.
   1. SCD.USA's compliance with this requirement is contingent upon receipt from Customer of all necessary assistance, support and documentation required from Customer and/or from Customer's customers and/or any intermediate and/or end user of the Deliverables, subject of the Agreement in a timely fashion. Accordingly, SCD.USA shall bear no responsibility whatsoever for any failure to comply with the requirements of the Agreement, resulting directly or indirectly from failure to receive any required assistance, support or documentation as mentioned herein.
   1. It is agreed and acknowledged that provision by SCD.USA of the Deliverables may require that Customer will furnish an End-Use Certificate for the application of the relevant export licenses. Notwithstanding the provisions of these General Terms of Sale, failure to provide the aforementioned End-Use Certificate shall relieve SCD.USA of its obligations to supply the Deliverables subject thereof, until such Certificate has been received and the required license has been issued by the applicable authorities in Israel.
   1. Upon obtaining the relevant export approval, SCD.USA shall inform the Customer of any limitations or provisions that may affect Customer’s use of the Deliverables, or which may affect SCD.USA’s ability to comply with its obligations under the Agreement.
   1. Where a failure or delay of SCD.USA to comply with its obligations under this article is due to governmental acts or omissions (including changes in governmental policy) the failure will constitute a Force Majeure event for which the provisions of article 18 will apply,

1. Assignment
   1. Unless otherwise approved, neither Party may assign, delegate, subcontract or otherwise transfer in any manner the Agreement nor any part thereof.
   1. Notwithstanding the forgoing, SCD.USA shall be entitled to transfer its rights under the Agreement without any limitation solely in case of corporate structural change and incorporation of the SCD.USA to a company and solely to the incorporated company. Customer shall be notified of any such realization of incorporation process.

1. Non Waiver

The failure of either Party at any time to enforce any of the provisions of the Agreement or to require performance by the other Party of any of the provisions hereof, shall in no way be construed to be a waiver of such provisions or in any way affect the validity of the Agreement or any part thereof, or the right of either Party thereafter to enforce each and every such provisions.

1. Force Majeure
   1. Neither Party shall be in default on account of the interruption of its performance under the Agreement by inter alia extraordinary natural disturbances, acts of God, acts or failure to act of a government in its sovereign capacity, any civil commotion, riot, insurrection or hostilities, epidemics, labor shortages or disputes and work stoppages, acts of terror, acts of war, whether declared or not, reserve draft, conditions that may adversely affect the safety of such Party's personnel and/or equipment, restrictions due to quarantines, unavailability of materials, severe and unforeseeable market shortage, or any other circumstances inclusive of circumstances which result from subcontractors, beyond the control of the Parties which will operate to frustrate the Agreement, or that arise without the fault or negligence of such Party and that result in delay of performance hereunder.
   1. Any such delay shall be referred to herein as a “Force Majeure” and shall entitle the delayed Party to a corresponding extension of the schedule. The Party whose performance is delayed by such events shall use its best efforts to notify the other Party within 10 (ten) days after the occurrence of such an event, and shall take all reasonable measures to mitigate the effect of such delay.

1. Disputes
   1. All disputes between the Parties which cannot be settled by agreement between the Parties shall be finally and exclusively settled by arbitration in accordance with the Rules of Arbitration of the International Chamber of Commerce (ICC) by single arbitrator appointed in accordance with the said Rules by both Parties.
   1. If the Parties cannot agree on the identity of the Arbitrator within 14 days of written notice of one party demanding the appointment of an Arbitrator, the Arbitrator will be appointed by the head of the ICC chapter in Israel.
   1. Place of arbitration shall be Haifa, Israel and the language to be used in the arbitral proceedings shall be Hebrew or English if Customer is not an Israeli corporation.
   1. The appointed arbitrator shall detail his judgment and his decisions shall be final and binding upon the Parties.
   1. All documentation and details regarding the arbitration shall remain confidential and undisclosed and shall be regarded as Proprietary Information as defined herein.
   1. This clause constitutes an arbitration agreement.

• Notices
  All notices and other communications shall be possible via Email and/or fax, if addressed to the formal point of contact within each Party. Official notifications as detailed in the Agreement shall be given in writing by personal delivery, registered mail or courier, and shall be addressed to the respective Party as follows, unless such address is changed by written notice to the other Party:

• Severability
  In the event that any part of the Agreement is determined to be invalid or unenforceable to any extent, such part, provision or condition shall be severed from the remaining parts which shall continue to be valid and enforceable to the fullest extent allowable by law.

• Governing Law

The Agreement shall be governed by and construed in accordance with the laws of the State of Israel.

• Headings
  The headings of the articles of these General Terms of Sale shall not be used to construe and/or interpret these Terms.

• Language
  All correspondence between the Parties, as well as all documentation, manuals, software listings and other writings, in connection with the Agreement shall be in the Hebrew language or in the English language for non-Israeli customers.