Quantum3D, Inc. Terms & Conditions of Purchase Order
Revised October 20, 2016
1. Definitions. “Q3D” means Quantum3D, Inc.. “Supplier” means the supplier or seller identified on the face of this Purchase Order (“Order”) and its subcontractors, agents, representatives and all other classes of persons performing any type of work under this Order.
2. Acceptance of Order. This Order constitutes Q3D’s offer to Supplier and shall become a binding contract upon Supplier’s i) written acceptance of this Order or ii) commencement of performance, whichever occurs first. Any terms and conditions proposed by Supplier in acknowledging or accepting Q3D’s offer which are different from or in addition to the terms set forth in this Order shall not be binding upon Q3D and shall be void and of no effect, except to the extent expressly accepted in writing and signed by Q3D’s authorized representative(s).
3. Products, Services and Software; Prices.
3.1. Supplier will sell to Q3D the products (the “Products”), the services (the “Services”) and/or license the software and user documentation (the “Software”) as specified on the face of the Order.
3.2. Unless otherwise specified on the face hereof, any Software being procured under the Order is being licensed and not sold, and accordingly, the words “purchase,” “sold,” or similar or derivative words are understood and agreed to mean “license”. Supplier grants to Q3D a transferable, sublicensable, perpetual, nonexclusive, fully paid-up, worldwide license (the “License”) to install, reproduce and use the Software subject to the terms of the Order. In the event that Q3D is obtaining a license for source code of any of the Software, in order for Q3D to obtain compatibility with other independently created software programs, Q3D has the right to revise, disassemble, reengineer, decompile or otherwise alter the Software to the extent necessary for interoperability or increased functionality.
3.3. Supplier agrees that the price(s) set forth on the face of the Order are firm, and not subject to increase. Further, the price(s), unless otherwise agreed, are inclusive of freight charges, duty and all applicable taxes, including but not limited to sales, use, and value added taxes, any charges for labeling, packing and crating, any finishing or inspecting fees, and any applicable royalties. Further, by accepting the Order, Supplier represents that the price(s) charged or terms granted for any Product, Service or Software are not in excess of the price(s) or terms charged or granted to other customers for substantially similar Products, Service, or Software and quantities on the date of the Order. In the event more favorable price or terms are granted, or in the event of a price decrease offered to other customers with respect to any Product, Service or Software (or those that are substantially similar), Supplier will notify Q3D and the more favorable terms or price will apply to all such Products, Services or Software not yet delivered to Q3D as of the date of such grant or decrease.
4. Invoices and Payment.
4.1. Invoices shall be itemized, submitted in duplicate, or, if indicated by Q3D, electronically, and shall contain the following information: PO or document number on the face hereof, item number, description of goods and services, sizes, quantities, unit prices, and extended totals in addition to any other information specified elsewhere herein. Payment of an invoice shall not constitute acceptance of any Products, Services or Software and shall be subject to adjustment for errors, overcharges, shortages or defects in the Products, Services or Software, or other failure of Supplier to meet the requirements of the Order. Payment will be due as stated on the face hereof, but not prior to Q3D’s acceptance of the Product, Service or Software.
4.2. Q3D, without liability to Supplier, may deduct from any amounts due to Supplier, any amounts owed to Q3D or any of Q3D’s affiliates by Supplier or any of Supplier’s affiliates under the Order or otherwise, and may withhold any payment without penalty to Q3D if Supplier owes any amount of money to Q3D or Q3D’s affiliates.
5. Delivery and Acceptance. TIME IS OF THE ESSENCE UNDER THIS ORDER. Delivery will not be deemed to be complete until the Products, Services or Software have been accepted by Q3D. If delivery is not completed by the delivery date on the face hereof (“Delivery Date”), Q3D may, without liability, in addition to its other rights and remedies, cancel the Order in whole or in part. Q3D may refuse to accept early deliveries and may return them at Supplier’s risk and expense, after which they will be redelivered only upon Q3D’s instructions, or may store them at Supplier’s risk and expense and delay processing the corresponding invoice until the Delivery Date. If it appears that Supplier will not meet the Delivery Date, Supplier will (i) immediately notify Q3D and (ii) ship by air freight or other expedited routing, at Supplier’s expense, if and in the manner requested by Q3D. If only a portion of the Products or Software are available for shipment to meet the Delivery Date, Supplier will notify Q3D and ship the available Products or Software unless otherwise directed by Q3D. Q3D may return any unauthorized undershipment or any overshipment at Supplier’s risk and expense. In the event that Q3D notifies Supplier of any rejection of any Product, Service or Software, Supplier shall, at Q3D’s option, refund Q3D for payment of the Products, Services and/or Software. Acceptance of any Products, Services and/or Software shall in no way release Supplier of any of its obligations hereunder (warranty or otherwise) to which Q3D may be entitled at law or in equity.
6. Shipments. Unless otherwise specifically provided on the face of the Order, shipments are DDP (as defined in Incoterms 2000) at Q3D’s ship-to location (“Destination”). Title shall pass to Q3D upon acceptance of Products and Software at Destination. Supplier will handle, pack, mark and ship the Products or Software in accordance with Q3D’s packing specifications (or, if none are applicable, in accordance with best commercial practice). Shipments will be made by the carrier in the method specified in the Order.. Any costs incurred by Q3D as a result of Supplier’s failure to comply with Q3D’s routing instructions shall be borne by Supplier.
7. Inspection. Supplier will permit, and cause its subcontractors to permit, Q3D, its direct or indirect customers, their respective representatives and/or any government representatives (“Representatives”) to witness and inspect Products, Software, or Services at any or all stages of their production or testing at any time at the facilities of Supplier or any of its subcontractors. Supplier will furnish, or cause to be furnished, without charge, all reasonable facilities and assistance for the safety and convenience of such persons in the performance of their duty. All Products, Software, and Services are subject to inspection and acceptance at Destination, notwithstanding any prior payments or inspection. QD may reject an entire lot based upon a sampling or inspect all units of the lot. Any such lot may be returned to Supplier for one hundred percent (100%) retesting at Supplier’s cost. After the retesting, the lot may be reinspected by Q3D. Q3D’s acceptance is always conditional; Q3D may later reject Products, Services, or Software that exhibit or develop defects. In the event Supplier becomes aware that a hazard may exist in any Product and the defect is capable of causing death or bodily injury to any person or property damage (“Hazard”), Supplier shall immediately notify the other party. Supplier shall be responsible for any and all costs associated with a Hazard including the cost of affecting a recall of the Product, including but not limited to the reasonable out-of- pocket costs to Q3D. Payment for any Products, Services, or Software under this Order shall not be deemed acceptance of the Products, Services, or Software.
8.1. Supplier represents, warrants and covenants that (a) the Products, Services and Software shall: (i) be new and free from defects in workmanship, material, manufacture, and design and shall be free and clear of all liens, claims, encumbrances and other restrictions; (ii) conform to specifications, any statements in documentation and packaging, and any approved samples; (iii) be merchantable, fit for the particular purpose and sufficient for the use intended by Q3D; (iv) be freely transferable by Q3D (and sublicensable in the case of Software). Supplier further warrants that the purchase, sale, performance or license of the Products, Services and Software shall in no way infringe or otherwise violate any copyright, trade secret, trademark, patent or other proprietary right of any third party. Additionally, Supplier represents, warrants and covenants that Software: (a) is free from any programming errors; and (b) does not contain any malicious code, program or other internal component (e.g., computer virus, computer worm, computer time bomb, or similar component), which could damage, destroy or alter any computer program, firmware or hardware or which could, in any manner, reveal, damage, destroy, or alter any data or other information accessed through or processed by the Software in any manner. The warranties set forth for Software as sections (a) and (b) shall not be affected by Q3D’s modification of the Software, including source code, so long as Supplier can discharge any warranty obligations notwithstanding such modifications or following their removal by Q3D. The foregoing warranties are in addition to all other warranties, expressed or implied, and shall survive any delivery, inspection, acceptance, and payment by Q3D. Q3D’s approval of Supplier’s material or design shall not relieve Supplier of the warranties set forth herein. This warranty shall run to Q3D’s customers and users of its products.
8.2. If any Product, Service or Software (including any rejected lot) does not conform to all requirements of the Order (“Non- Conforming Product”), Q3D may, at its option, (i) require Supplier to deliver replacement or repaired Products or Software or conforming Services to Q3D no later than ten (10) days after Q3D’s notice of non-conformance or (ii) repair or replace the Non-Conforming Product and recover from Supplier Q3D’s reasonable expenses of same (and Supplier hereby grants Q3D and its designees all rights, and agrees to provide all information and technical data, necessary for any such repair) or iii) refund to Q3D all amounts paid under the Order.
8.3. By accepting this order Seller hereby warrants that the items and services to be furnished hereunder will be in full conformity with Buyer’s specifications, drawings and data, Seller’s samples, not be or contain Counterfeit Items, and that items furnished hereunder will be fit for the use by Buyer.
For purposes of Warranty, a Counterfeit Item is defined to include, but is not limited to, (i) an item that is an illegal or unauthorized copy or substitute of an Original Equipment Manufacturer (OEM) item; (ii) an item that does not contain the proper external or internal materials or components required by the OEM or that is not constructed in accordance with OEM design; (iii) an item or component thereof that is used, refurbished or reclaimed but Seller represents as being a new item; (iv) an item that has not successfully passed all OEM required testing, verification, screening and quality control but that Seller represents as having met or passed such requirements; or (v) an item with a label or other marking intended, or reasonably likely, to mislead a reasonable person into believing a non-OEM item is a genuine OEM item when it is not.
9. Changes and Cancellations. Q3D may reschedule Delivery Dates, change Destinations, make any other changes (including changes to designs and specifications) with respect to the Order (“Change”), or may cancel the Order, in whole or in part (“Cancellation”), at any time prior to delivery and acceptance by notice to Supplier. If any Change by Q3D causes an increase or decrease in the cost of or the time required for performance of the Order, an equitable adjustment shall be negotiated promptly and the Order will be modified in writing accordingly. Otherwise, Q3D’s sole liability with respect to Changes or Cancellation will be to reimburse Supplier for the actual, reasonable and substantiated costs incurred by Supplier as a direct result of the Change or Cancellation that Supplier cannot recover either by shipping the Products or Software to other customers within a reasonable time or by exercising other mitigation measures in a commercially reasonable manner.
10.1. SUPPLIER WILL FULLY INDEMNIFY, DEFEND AND HOLD Q3D HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS, DEMANDS, DAMAGES, LOSSES, LIABILITIES, COSTS OR EXPENSES (INCLUDING SETTLEMENT COSTS AND ATTORNEYS’ FEES) (COLLECTIVELY, “LOSSES”) ARISING OUT OF OR RELATED TO: (A) ANY CLAIM THAT THE PRODUCTS, SERVICES OR SOFTWARE INFRINGES ANY PATENT, COPYRIGHT, TRADE SECRET, TRADEMARK OR OTHER PROPRIETARY OR INTELLECTUAL PROPERTY RIGHT;
(B) SUPPLIER’S NEGLIGENCE OR SUPPLIER’S PERFORMANCE OF, OR FAILURE TO PERFORM, ANY OF SUPPLIER’S OBLIGATIONS; AND (C) ANY AND ALL CLAIMS BY OR ON BEHALF OF SUPPLIER’S SUBCONTRACTORS, MATERIALMEN, SUPPLIERS, EMPLOYEES OR AGENTS. THE FOREGOING OBLIGATIONS WILL APPLY REGARDLESS OF WHETHER THE LOSS IN QUESTION ARISES IN PART FROM ANY NEGLIGENT ACT OR OMISSION OF Q3D, FROM STRICT LIABILITY OF Q3D, OR OTHERWISE. SUPPLIER WILL DEFEND THE CLAIM UTILIZING COUNSEL APPROVED BY Q3D. IN THE EVENT OF AN INFRINGEMENT CLAIM, SUPPLIER WILL, AT SUPPLIER’S EXPENSE: (A) IMMEDIATELY OBTAIN THE RIGHT FOR Q3D TO CONTINUE TO USE THE PRODUCTS, SERVICES OR SOFTWARE, OR (B) MODIFY THE PRODUCTS OR SERVICES SO AS TO RELIEVE THE PURPORTED INFRINGEMENT WHILE STILL COMPLYING WITH ALL THE REQUIREMENTS OF THIS ORDER. FOR PURPOSES OF THIS SECTION THE TERM “Q3D” ALSO INCLUDES Q3D’S OFFICERS, DIRECTORS, SHAREHOLDERS, EMPLOYEES, REPRESENTATIVES, AND AGENTS.
10.2. Supplier shall carry and maintain insurance coverage satisfactory to Q3D to cover Supplier’s obligations set forth in subparagraph (a) above, and upon Q3D’s request, shall furnish Q3D with evidence of such insurance in a form satisfactory to Q3D.
11. Non-Disclosure of Confidential Information. The existence and terms of the Order; any data, specifications, drawings, technology or other information or materials that relate to the business, technology, prospects, financial condition or other proprietary or confidential information of Q3D which Supplier may obtain from Q3D or otherwise discover, and all Supplier’s information derived from or incorporating any of the foregoing shall be maintained by Supplier as confidential using the same degree of care that Supplier uses to protect its own confidential information or materials (but no less than reasonable care) and shall be used only for purposes of performing pursuant to the Order. Supplier agrees not to use the name, logos or trademarks of Q3D or to quote the opinion of any Q3D employee in any advertising or otherwise without obtaining the prior written consent of Q3D. Absent a formal written agreement to the contrary, all data, specifications, drawings, technology, and other information or materials supplied to Q3D by Supplier will be provided to Q3D on a non-confidential basis and may be used and/or disclosed by Q3D without restriction.
12. Q3D Property; Intellectual Property Rights.
12.1. All tools, specifications, designs, or other property furnished to or paid for by Q3D in connection with the Order (“Q3D Property”), shall (a) be and remain Q3D’s property, marked as such and kept segregated from other property; (b) be used only by Supplier and only in performance of the Order, (c) not be moved from Supplier’s premises without Q3D’s written consent, (d) not be affixed to real property, (e) be kept free of all liens, claims, encumbrances, and restrictions, and (f) not be modified or altered by Supplier or any other person. Supplier will bear all risk of loss or damage to Q3D Property and Supplier shall insure Q3D Property at Supplier’s expense in an amount equal to the replacement cost with loss payable to Q3D until it is returned to Q3D. Upon Q3D’s request, Supplier will ship at Supplier’s expense all Q3D Property in good condition, ordinary wear and tear excepted, DDP (as defined in Incoterms 2000) to Q3D’s ship-to location (“Destination”). Supplier waives any legal or equitable rights or claims in connection with Q3D Property.
12.2. Supplier hereby assigns (and agrees to cause to be assigned) to Q3D, as a work-for-hire, all rights, title and interest in and to any and all intellectual property rights with respect to all writings, software, drawings, designs, expressions of ideas, or other copyrightable material, inventions, improvements, developments and discoveries (collectively referred to as the “Ideas”) made, conceived or reduced to practice by Supplier solely or in collaboration with others during the course of performance of the Order. Such Ideas are the sole property of Q3D. Supplier further agrees to assist Q3D, at Q3D’s expense, to enable Q3D to obtain, perfect, defend, and enforce its rights in and to all such Ideas, and in the execution of all applications, specifications, assignments, and all other instruments which Q3D shall deem necessary in order to apply for and obtain copyright protection, and/or patent protection.
13. Limitation of Q3D’s Liability. IN NO EVENT SHALL Q3D BE LIABLE FOR ANTICIPATED OR LOST PROFITS OR FOR SPECIAL, PUNITIVE, INDIRECT, INCIDENTAL, OR CONSEQUENTIAL DAMAGES. Q3D’S TOTAL LIABILITY ON ANY CLAIM OF ANY KIND FOR ANY LOSS OR DAMAGE ARISING OUT OF OR IN CONNECTION WITH OR RESULTING FROM THIS ORDER OR FROM THE PERFORMANCE OR BREACH THEREOF SHALL IN NO CASE EXCEED THE PRICE ALLOCABLE TO THE PRODUCTS, SERVICES, AND/OR SOFTWARE OR UNIT THEREOF WHICH GIVES RISE TO THE CLAIM. Q3D EXPLICITLY REJECTS, AND SHALL NOT BE LIABLE FOR, ANY CANCELLATION CHARGES, LATE FEES, PENALTIES, OR LIQUIDATED DAMAGES.
14. Compliance with Laws. Supplier shall comply with all federal, state, local and governmental agency laws, ordinances, rules and regulations in the manufacture and sale of the Products and/or Software and in the performance of Services covered in the Order. In addition, Supplier shall comply with all applicable
U.S. export control laws and regulations, including but not limited to, the International Traffic in Arms Regulations (ITAR) and the Export Administrations Regulations (EAR). While Supplier is on Q3D’s premises, Supplier shall comply with Q3D’s site policies, procedures, and programs relevant to Supplier’s provision of goods and/or services.
15. Government Contracts. If the Products, Services or Software are to be used by Q3D in the performance of a U. S. Government contract or subcontract, those clauses of the applicable government procurement regulations (including but not limited to FAR and DFARS) that are required by federal law to be included in government contracts or subcontracts will be deemed to apply to the Order and will be incorporated by reference. The clauses so incorporated applying to Supplier, as though Supplier were a prime contractor, will be interpreted in such manner as will enable Q3D to meet its obligations arising out of the government contract or subcontract.
16. General Provisions. Supplier shall assign no right or obligation under the Order (including but not limited to the right to receive monies due hereunder) without the prior written consent of Q3D, and any purported assignment without such consent shall be void. Supplier may not subcontract for completed articles or major components without Q3D’s prior written consent. Q3D may assign the Order at any time upon notice to Supplier. Supplier agrees that all Product, Services and Software purchased under the Order, are freely transferable by Q3D. The failure of Q3D to enforce at any time any of the provisions of the Order, to exercise any election or option provided herein, or to require at any time performance by Supplier of any of the provisions herewith shall in no way be construed to be a waiver of any such provisions, or the right of Q3D thereafter to enforce each and every such provision. Supplier and Q3D are independent contractors; neither is an agent or employee of the other or has any authority to assume or create any obligation or liability of any kind on behalf of the other. Any provision of the Order that is invalid or unenforceable under applicable laws with respect to a particular party or circumstance will be severed from the Order with respect to such party or circumstance without invalidating the remainder of the Order or the application of such provision to other persons or circumstances. These Terms and Conditions shall not be construed against the party preparing it but shall be construed as if both parties jointly prepared these Terms and Conditions, and any uncertainty and ambiguity shall not be interpreted against any one party. The headings used in his Order have no legal effect.
17. Applicable Law. This Order shall be governed by and construed in accordance with the laws of the State of California. Products, Services and Software provided hereunder shall be deemed to be “goods” within the meaning of the California Uniform Commercial Code. The provisions of the United Nations Convention on the International Sale of Goods shall be excluded without regard to principles of conflicts of law. Further, Q3D and Supplier hereby irrevocably consent to the exclusive jurisdiction of the courts of the State of California in connection with any action brought by either party arising under or related to the Order. Any legal action or proceeding relating to this Order shall be instituted in a state or federal court in Santa Clara County, California and each party hereby consents to the exclusive jurisdiction of such courts.
18. Import/Export Requirements. Supplier will certify to, and mark Products, Software, and packaging with, the country of origin for each Product so as to satisfy the requirements of customs authorities of the country of receipt and any other applicable laws. If any Products and/or Software are imported, Supplier will, at Q3D’s request, either (i) allow Q3D to be the importer of record or (ii) provide Q3D with any documents required to prove importation and to transfer duty drawback rights to Q3D.
19. Disputes; Default; Remedies; Attorneys’ Fees; Survival.
19.1. Notwithstanding anything to the contrary in the Order, in the event (a) Supplier fails to comply with any of the terms and conditions herein or (b) Supplier makes an assignment for the benefit of its creditors, a receiver is appointed for Supplier, or any bankruptcy or insolvency proceedings are instituted by or against Supplier, Q3D may consider the same a breach of contract by Supplier and may, at Q3D’s sole option (i) terminate the Order in whole or in part, without any liability or obligations to Supplier and obtain products, software, or services similar to the Products, Software, or Services upon such terms and in such manner as Q3D reasonably deems appropriate, and Supplier will reimburse Q3D upon demand for all additional costs, direct or indirect, incurred by Q3D in procuring same or (ii) require Supplier’s specific performance.
19.2. Except as may be otherwise provided in the Order or any agreement, the rights or remedies of Q3D hereunder are not exclusive, and Q3D shall be entitled alternatively or cumulatively, subject to the other provisions of the Order, to damages for breach, to an order requiring specific performance or to any other remedy available at law or in equity (or provided under the UCC). Termination of the Order will not affect any of the parties’ rights or obligations that are either (i) vested as of such date or (ii) intended by the parties to survive termination, including Sections 8, 10, 11, 12, 13, 16, 17, 19, and 20.
20. Entire Agreement. The Order and these Terms and Conditions constitute the entire integrated agreement between Supplier and Q3D with respect to such Products, Services and Software purchased hereunder and supersedes all prior written or oral understandings or agreements relating to the same. In the event of any conflict between these terms and the terms on the face hereof, the terms on the face hereof will govern. No modification of the Order will be binding on Q3D unless set forth in an agreement specifically referencing the Order and signed by an authorized agent of each party.
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