Helping customers create and manufacture advanced technology products for our future.

TERMS and CONDITIONS of SALE

for CONSULTING and ENGINEERING SERVICES

1.    AGREEMENT

A.  These Terms and Conditions govern the contract engineering services specified by this Proposal.  Together, they constitute the entire understanding between TME and Customer, superseding all prior representations, proposals, or communications, whether written or oral.

B.  The purpose of this Agreement is for TME to provide Customer with the services described in this Proposal.  Such services may include business and technical consulting, advanced technology engineering, and manufacturing services for prototypes of Customer products, custom test equipment, and/or custom process equipment.  Such prototypes and custom equipment, including any associated software or documentation, are collectively referred to as the Goods in this agreement.

C.  The parties agree that the terms of this Agreement pertain only to the Contract Engineering Services specified in this Proposal.  They expressly agree that any other engineering work between Customer and TME or third parties are governed by distinctly separate agreements.

D.  This Proposal will be accepted as the Contract governed by this Agreement after  (1) authorized representatives from both parties sign it and  (2) TME receives the initial payment stated in the proposal.  TME will not perform any work described in this Proposal until both conditions are met.  The Proposal number, revision, date, and title shall serve to identify the Proposal and shall become the Contract number, revision, date, and title after acceptance.

2.    TME RESPONSIBILITIES

A.  TME shall perform the services described by this proposal.

B.  TME shall perform all services in a professional and workmanlike manner and in accordance with generally recognized commercial practices and standards.

C.  If a project is identified to TME as subject to export control under the International Traffic In Arms Regulations, TME will assign personnel to projects so as to avoid assigning foreign person-employees to projects in which they might be exposed to export-controlled data.

3.     CUSTOMER RESPONSIBILITIES

A.  Customer shall fully cooperate with TME in a timely manner during the term of this agreement.  Customer shall be solely responsible for supervision and control of its personnel and internal operations.

B.  Customer shall be solely responsible for the content of all project design specifications agreed to by TME.  Customer acknowledges that the value of TME services and any resulting performance is dependent upon the accuracy of the information and data given to TME.

C.  Customer shall provide TME with access to and use of all resources deemed necessary by TME to execute this agreement.  Such resources may include information, documentation, personnel, computer time, facilities, and a suitable workspace.

D.  Customer shall disclose whether TME services or Customer data relating to this proposal is subject to US government export controls (International Traffic In Arms Regulations, etc.) and to label any such data as subject to export control.

4.     PERSONNEL

A.  TME and Customer shall each appoint a Project Leader to monitor and coordinate the performance of this agreement.  Either party may change their own appointees by written notice to the other party.  Except for routine correspondence and invoicing, notices will be directed to such Project Leaders.

B.  TME reserves the right to select and reassign any qualified TME employees or subcontractors to provide the services in this Proposal.  TME reserves the right to perform similar services for other parties using such TME employees or subcontractors.

C.  TME personnel will not enter or remain at Customer's facility to perform work without the presence of the Customer’s Project Leader or an authorized employee.

5.     CHANGES IN WORK

A.  Either party may request proposal changes at any time prior to proposal acceptance by addressing a written request to the other party's Project Leader.  Changes shall only be effective if agreed to by TME and Customer and documented by a revised proposal.

B.  If Customer requests changes after this proposal is accepted or if TME determines that any Customer supplied information is inaccurate or incomplete, TME reserves the right to either agree to appropriate changes in a revised proposal or to proceed with the original proposal.

6.    ACCEPTANCE

A.  Acceptance of the Goods shall be accomplished using the Acceptance Test Procedure established and agreed to by TME and Customer, and at a site agreed to by both parties.  If the Goods consist only of documentation, then acceptance shall occur upon delivery of the completed documentation by TME.

B.  Acceptance of the Goods, if applicable, shall be deemed to occur upon the earlier of either the successful completion of the acceptance tests or the productive use of the Goods by Customer.

C.  If the Goods fail any acceptance test and has not been in productive use, TME shall have the right, without liability, to a sixty (60) day period for correction and rerun of the tests, which may be extended and renewed by mutual agreement.

D.  TME and Customer recognize the uncertainty and difficulty of estimating Customer's damages in the event of TME's failure to cure.  Both parties agree that Customer's sole and exclusive remedy for such failure shall be to terminate this Agreement, to retain as liquidated damages any holdbacks which would otherwise be due TME, and to receive from TME the same Rights set forth in the Right to Cancellation section of this Agreement which Customer would have received upon successful completion of the acceptance tests and full payment hereunder.

7.     PAYMENT

A.  TME shall provide Customer with a payment schedule as part of the Proposal.  Unless otherwise stated in writing, all charges quoted are valid for sixty (60) days after the date of the proposal.

B.  Prices quoted in this proposal do not include charges for shipping, special packing, taxes and insurance.  Customer shall pay for such charges.  If Customer requests that TME arrange for shipping, the charges incurred will either be added as a separate item on the invoice or will be shipped collect at TME's option.

C.  Prices quoted in this proposal do not include any taxes, including state and local use, sales, property (ad valorem) and similar taxes.  Customer agrees to pay such taxes unless Customer has provided TME with a valid exemption resale certificate or is otherwise exempt from such taxes.  If applicable, TME shall list such taxes as a separate item on the invoice.

D.  Charges shall be invoiced by TME and shall be due and payable within fifteen (15) days of the date of invoice.  Interest from the due date shall accrue on any sum past due at the lesser of two percent (2%) per month or the maximum amount allowable by applicable law.

E.  Should Customer become delinquent in payment of any sum due TME, after ten (10) days from the date of written notice to Customer, TME shall not be obligated to continue performance under any Agreement with Customer.  At TME's option, TME may also consider Customer to have canceled the Contract Engineering project according to the Right to Cancellation section of this Agreement.

8.     TITLE AND INSURANCE

A.  Title to equipment and risk of loss and damage shall pass to Customer at TME's plant.  Customer purchased equipment, components, material, etc. that is shipped to TME for inclusion in the Goods being manufactured by TME or provided to TME for development purposes shall be insured by TME for the time located on TME premises, unless buyer provides a written statement that it is already insured by buyer.  The charge for this insurance coverage is not included in any quotations under this Agreement and shall be added to the final invoice as a separate line item.

9.     WARRANTY

A.  Product prototypes provided by TME as part of this proposal are warranted to be free from defects in workmanship and materials for a period of ninety (90) days after acceptance.  Custom test or process equipment provided by TME as part of this proposal are warranted to be free from defects in workmanship and materials for a period of one year after acceptance.  During this period TME will repair or replace any components that are determined to be defective.

B.  Warranty shall not apply to any Goods that have been physically damaged or wear out due to high use.  The warranty shall not apply to any Goods that fail due to Customer accident, neglect, tampering, alterations or repairs by non-TME personnel, misuse, negligent handling (shock, electrostatic discharge, fiber optic connection damage, etc.) or operation in unusual environments.

C.  The warranty shall not apply to any commercial equipment, critical components, or software from a third party used in the Goods, if any.  In such cases, Customer is responsible for obtaining warranty service or out-of-warranty repair from the third party.

D.  TME does not warrant that use or operation of the Goods will be uninterrupted or error free.

E.  TME does not warrant that all parts or software used in the Goods will be available beyond the warranty period.  Customer acknowledges that parts or software obsolescence may require a hardware or software re-design in order to maintain out-of-warranty Goods or to procure additional Goods of the same design.

10.     RIGHT TO CANCELLATION

A.  Customer may cancel this Agreement at any time by written notice to TME.

B.  In the event Customer cancels or gives TME reason to cancel, cancellation shall be without liability to either party except for  (1) tender by TME of all Goods required under this Agreement through the date of cancellation for which Customer has paid, and  (2) payment by Customer to TME for cost incurred by TME, all invoices due prior to cancellation including any holdbacks, and time and material charges for work in progress through the date of cancellation in accordance with TME's standard non-contracted services rates.

C.  Cancellation shall not operate to terminate any intellectual property rights granted under this Agreement.

11.     CONFIDENTIAL INFORMATION

A.  TME will sign ordinary mutual non-disclosure agreements provided by Customer or will provide such an agreement at Customer’s request.

B.  Certain information exchanged between the parties may be made confidential if it relates directly to the Goods and is appropriately labeled.  Such "Confidential Information" shall be disclosed in writing or, if first disclosed verbally or visually, shall be reduced to writing and forwarded to the other party within thirty (30) days of disclosure.  For any writing to be considered Confidential Information it must be labeled "(Customer or TME) Confidential."

C.  Each party agrees to use the same degree of care to avoid disclosure of the other party's Confidential Information as it uses with its own Confidential Information.  Such obligations of confidentiality shall continue for two years after acceptance of the Goods and shall survive any termination or cancellation of this Agreement.  All Confidential Information is the sole property of the originator and shall be returned along with all copies upon request.

D.  This Agreement shall not impose any obligation on either party for Confidential Information which is already in the other party's possession, is published other than through a breach of this Agreement, is independently developed by the other party, is rightfully received from a third party without restriction, is approved for release in writing by the party from whom the information originated, is required to be disclosed by law or by order of a court of competent jurisdiction, or is furnished by the originating party to a third party without similar restrictions on such third party's rights.

12.     INTELLECTUAL PROPERTY RIGHTS

A.  Customer agrees that all right, title, and interest in or pertaining to the Goods under this Agreement shall belong to TME until acceptance of and payment for the goods by the Customer.

B.  Upon acceptance and upon payment of all fees, TME grants Customer title to the Goods, including the right to use, reproduce, translate, and modify the Goods, notwithstanding the warranty terms of this Agreement.  In return, Customer grants TME an unrestricted license to use, reproduce, translate, and modify the Goods.  However, TME shall not have the right to use any portion of the Goods that incorporates or makes use of intellectual property that is proprietary to Customer.

C.  Customer has a non-exclusive shop right to use intellectual property created by TME for Customer without extra consideration.  Customer can freely use for its business purposes any materials TME originates in the course of a project.  Such materials include proposals, plans, drawings, documents, calculations, circuit designs, software executables, packaging techniques, selected materials and components, suppliers, test methods, and manufacturing methods.  TME generally does not perform “work for hire” and retains the right to use the same materials for its business purposes.

D.  TME maintains various CAD software tools to express designs for the Goods.  TME generally does not use Customer CAD tools for such designs.  TME will provide Customer with imaging files or printed documents but does not generally provide source files without special consideration.  Unless otherwise requested by Customer, TME will provide Customer with engineering documentation in Adobe Acrobat “pdf” imaging file format on CD-R compact disc media.  Documentation typically includes mechanical drawings, schematics, parts lists, circuit layouts, and instructions.

E.  Prices in this Proposal do not include amounts for securing or maintaining Customer intellectual property rights, such as patents, copyrights, trademarks, and trade secrets.

13.     US EXPORT REGULATIONS

A.  Customer agrees that technical data supplied to Customer by TME, either directly or through others, or the direct product of such data shall not be re‑exported to the proscribed countries listed in Section 279.4 of the US Export Administration Regulations unless Customer notifies TME that an authorization has been obtained from the United States Department of Commerce.

14.     LIMITATION OF LIABILITIES, REMEDIES, AND ACTIONS

A.  TME will not assume any liability for the use of TME Goods in any kind of “life support” device or system.  If such extraordinary product liability potential exists, then Customer must accept legal responsibility for any such litigation that could be related to TME activities with Customer.

B.  TME agrees to use reasonable, good faith effort, to meet all estimated delivery dates but shall not be liable for failure to meet such dates.

C.  TME shall not be liable for delays in performance due to unforeseen circumstances or causes beyond its reasonable control.  This includes, but is not limited to, acts of nature, acts of government, war, civil unrest, labor disputes, personnel unavailability, or delays by suppliers.

D.  TME does not carry general liability insurance, but will secure such insurance at Customer’s request and cost.

E.  TME encourages open, honest, and ethical 2-way communication in order to obtain the best results for both TME and Customer.  TME and Customer agree to settle disputes (first) by in-person verbal meetings, (second) through 2-way written communications, (third) through arbitration under the rules of the American Arbitration Association, and (fourth) through the court system.

F.  If any legal action or other proceeding is brought for the enforcement of this Agreement, or because of an alleged dispute, breach, default, or misrepresentation in connection with any of the provisions of this Agreement, the prevailing party shall be entitled to recover reasonable attorney's fees and other costs incurred in that action or proceeding, in addition to any other relief to which it may be entitled.

G.  The remedies provided herein are Customer's sole and exclusive remedies.  In no event shall TME or its subcontractors, if any, be liable for indirect, special, incidental or consequential damages, including loss of profits, downtime and loss of data.  TME’s liability for direct damages shall not exceed the amount of any payments made by Customer for the services herein provided.

H.  The forgoing limitation of liability shall not apply in the event that the Goods provided by this proposal are determined by a court of competent jurisdiction to be defective and to have directly caused bodily injury, death or property damage.  In no event shall TME's liability for property damage exceed the amounts paid by Customer under this proposal.

I.  Any action against TME hereunder must be brought within one year after the cause of action accrues.

15.     MISCELLANEOUS

A.  Except as may be prohibited by the US bankruptcy laws, in the event of any insolvency or inability to pay debts as they become due by a party hereto, or voluntary or involuntary bankruptcy proceeding by or against a party hereto, or appointment of a receiver or assignee for the benefit of creditors, the other party may elect to cancel any unfulfilled obligations hereunder.

B.  If any term or condition of this Agreement is invalid under any applicable statute or rule of law, it shall to that extent be deemed omitted without effect on the validity of the remainder of this Agreement.

C.  Neither party may assign or transfer any of its rights, duties, or obligations herein without the prior written consent of the other.  Any purported attempt to do so shall be null and void.

D.  Modification of this Agreement after its initial acceptance shall not be valid or binding on either party unless a modified proposal or addendum is signed by the appointed TME and Customer Project Leaders.

E.  Any additional or conflicting terms or conditions in any Customer purchase order or document shall be void and of no effect.

F.  This Agreement shall be governed by and construed in accordance with the laws of the State of Texas.  Customer hereby acknowledges that a portion of the services to be provided hereunder will be performed in the State of Texas and expressly consents to it.

G.  This Agreement shall be deemed to have been entered into in Plano, Texas, on the date accepted by TME.  Any questions concerning the validity, interpretation or performance of any rights or obligations of the parties hereto, shall be resolved in Plano, Texas, in accordance with the laws of the State of Texas.

H.  Nothing in this Agreement shall be construed to prohibit TME from performing similar services for others.

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