TERMS AND CONDITIONS

These terms and conditions (the “T&Cs’) are solely applicable to the purchase made directly from Optosecurity Inc. and its affiliates (“Optosecurity”) by a customer to be the end-user and beneficiary (the “Customer”) of software solution, License, hardware, Installation, Training and/or Services to use Optosecurity System (the “Products”), which shall be defined in a signed quotation or proposal issued by Optosecurity (the “Quotation”). By placing an order to Optosecurity, Customer agrees to be bound by the T&Cs.

RIGHTS GRANTED - Customer shall have the limited right to use the Optosecurity real-time image processing systems (the “System”), as described on the Quotation. Customer may allow its agents and contractors to use the Products for its own internal operations, but Customer remains responsible for their compliance with the T&Cs during such use. 

Upon full payment, Customer will be granted a perpetual, non-exclusive, non-transferable, non-assignable, royalty free license to use, in object code only, the programs and software owned and distributed by Optosecurity for its own internal business operations (the “License”). License may nevertheless be subject to additional license terms, which shall be noted in the Quotation if applicable. 

With respect to third party programs, the rights granted to Customer shall be those set forth in the applicable license agreement between Optosecurity and the said third party. 

Customer will receive consulting, implementation, and integration services (the “Installation”) as described in the Quotation, if applicable. Customer will receive, documentation, training and tutoring services (the “Training”) as described in the Quotation, if applicable. Customer will receive software upgrades and threat library editions, including technical support for those (the “Services”) for ninety (90) or more days after the acceptance date as described in the Quotation, if applicable. 

The acceptance date shall be defined as the earlier of (i) the date the Customer signed the notice of acceptance, or (ii) thirty (30) days after Delivery Date. Delivery Date shall be the date when the hardware is made available to Customer and delivery is made as per delivery terms stated below. Customer acceptance shall be unconditional. Customer shall not be entitled to use the Products for any purpose other than testing the Product until Acceptance date.

Optosecurity will provide such resources and utilize such employees and/or third party consultants as it deems necessary to deliver and perform the Products as specified in the Quotation. The manner and means used by Optosecurity to perform the Services desired by Customer are in the sole discretion and control of Optosecurity. Optosecurity shall use commercially reasonable efforts to meet the schedules and times of performance for the Services as set in the sales order.

OWNERSHIP AND RESTRICTIONS - Optosecurity and, as the case may be, its licensors retain all ownership and intellectual property rights to the System and Products. Ownership of Products shall be transferred to the Customer upon full payment of all amounts payable to Optosecurity pursuant to the Quotation. Customer may not:
•    remove or modify any Product markings or any notice of Optosecurity’s or its licensors’ proprietary rights;
•    copy, modify, merge, sell, lease, assign, transfer or make available the Products or any other material delivered by Optosecurity to Customer to any third party, in whole or in part, unless prior written approval obtained from Optosecurity;
•    copy, translate, reverse engineering, decompile programs and software, or disassemble the System or one of its components, including by opening the System or breaking the seals affixed to the System or make any other unauthorized use of System, programs and software, unless required by law for interoperability with prior written approval obtained from Optosecurity;
•    assist or cooperate with third parties attempting any of the above.
Customer’s failure to comply with the provisions of this article shall render the warranty provisions under these T&Cs null and void and may cause legal actions from Optosecurity. 

EXPORT CONTROL - Customer acknowledges that the Products sold and License granted by Optosecurity may be subject to export control laws and regulations and agrees to comply with such restrictions. Customer shall not export or re-export the Products and make available the Products or related technical information and materials, directly or indirectly, in violation of any applicable foreign or domestic statues, laws, regulations or tariffs, or to any country to which such transmission is restricted by such regulations, export law or regulation or applicable statues.

DELIVERY AND INSURANCE - All Products ordered pursuant to the Quotation shall be delivered to Customer Ex works (EXW) (Incoterm 2010) Quebec City (Canada), unless otherwise stated in the Quotation.
Without limiting the generality of the foregoing but for greater certainty, Customer acknowledges that it shall assume all risks of loss or damage of Products that it shall assume during loading at Optosecurity’s premise and subsequent manipulation and transportation. Customer shall assume freight, insurance, customs clearance, duty, or taxes, loading, unloading and transportation costs associated with the delivery of System to its final destination. 

CUSTOMER’S RESPONSIBILITIES - Customer agrees to provide Optosecurity with such accurate information, materials, and technology owned and controlled by Customer as Optosecurity reasonably requires in order to perform Installation and Services if applicable. Notwithstanding the foregoing but for greater clarity, Customer acknowledges that it shall be its sole responsibility to provide the material required to test the System, including materials such as liquid threats and weapon threats, including firearms and explosives, and any other substance as the case may be (the “Prohibited product or substance”).

Customer shall cooperate in good faith to achieve completion of Installation and Services, if applicable, in a timely and professional manner. Customer understands and agrees that Optosecurity’s timing in providing of Services may depend on the completion of certain Customer tasks and compliance to Customer schedules within Customer’s control; consequently the schedule for completion of Installation and Services or any portion thereof may require adjustments or changes in the event such Customer tasks or schedules change or are modified or are not completed as anticipated. Notwithstanding the foregoing but for greater clarity, Customer shall I) prepare premises for the supply of the Products and obtain and maintain all necessary licenses, permissions and consents which may be required for the Products before the Installation Date, and ii) ensure that shipping and custom clearance are made in a timely matter and that the goods are available to Optosecurity to provide the Products before the Installation Date.
Customer shall provide to Optosecurity’s personnel and agents, any documents and/or security clearance required to enter the country and/or access to the Customer’s premises and equipments where the Products are to be installed or performed, prior to the delivery of System.  

Customer shall allow Optosecurity to perform the Installation in accordance with the installation date stated in the Quotation (the “Installation Date”), if applicable. Within the period ending thirty (30) days from the Quotation date, Customer may postpone the Installation Date, upon written notice. Should Customer postpone the Installation to a date beyond thirty (30) days from the original Installation Date, Customer shall be deemed to have accepted the System thirty (30) days after the Installation Date originally agreed in the Quotation, irrespective of any deficiency of the System at such date.

Customer grants Optosecurity permission to install the System and Products onto X-ray equipments and any other equipment as the case might be. Customer confirms that that Installation and all related changes are done at its request. Customer fully understands and agrees that some adjustments and/or modifications may have to be executed during Installation to the X-Ray equipments to maximize the performance of System. Optosecurity shall bear no liability for any damage or breach of warranty caused by the Products being installed or performed on the X-Ray equipments.
 
Customer understands and agrees that the overall responsibility for security still relies upon the Customer security staff and screeners. Customer also agrees that Optosecurity is not liable in any way for safety or for the safety and integrity of Customer’s property.

Customer is required to subscribe to Services on a continuous basis in order to obtain up to date Services. Should Customer decide to subscribe to Services after not subscribing for a certain period, Customer shall pay the fees applicable for the Services for the whole unpaid period before receiving up to date Services. 

Customer shall ensure that proper maintenance of System is performed as described in the System documentation. Maintenance shall be performed by Optosecurity or an authorized certified Optosecurity service agent. 

If Optosecurity's performance of any of its obligations in respect of the Products is prevented or delayed by any act or omission by Customer or failure by Customer to perform any relevant responsibilities, i) Optosecurity shall without limiting its other rights or remedies reasonably have the right to suspend performance of the Products until Customer remedies its default, ii) Optosecurity shall not be liable for any costs or losses sustained or incurred by Customer arising directly or indirectly from Optosecurity's failure or delay to perform any of its obligations; and iii) Customer shall reimburse Optosecurity on written demand for any reasonable costs or losses sustained or incurred arising directly or indirectly from Customer default.

AUDIT - Upon five (5) days written notice to Customer, Optosecurity may audit Customer’s use of Products. Customer agrees to cooperate with Optosecurity’ audit and provide reasonable assistance and access to information. Customer understands that Optosecurity is not responsible for any of the costs incurred by Customer in cooperating with the audit.

FEES AND TAXES - All fees payable to Optosecurity are to be paid by wire transfer of funds to the account designated by Optosecurity. Customer agrees to pay all sales, value-added, excise or other similar taxes imposed by applicable law that Optosecurity must pay for the Products ordered, with the exception of any taxes based on Optosecurity’s income. All fees for Products listed in the Quotation, unless indicated otherwise, do not include applicable taxes. 

The price of Products shall be the price set out in the Quotation. If no price is quoted, the price is set out in Optosecurity’s published price list as at the date of delivery.

Customer agrees to pay within 30 days any invoiced fees applicable to Customer as per Invoicing Terms, unless otherwise described in the Quotation. Invoicing Terms are defined as i) at order, 20% of the total Quotation value, ii) at shipping, remaining value of the software, hardware and shipping costs, and iii) at Acceptance Date, remaining portion of the Quotation.  

Should Customer fail to pay, Optosecurity may defer any scheduled delivery of System and License and/or defer Installation until Customer fulfills these obligations, and/or may end the Quotation in its entirety. 

RETURNS - Optosecurity operates under a thirty (30) day return policy. To be accepted for return on the basis of this Article herein, Customer shall send a written notice to Optosecurity within thirty (30) days of delivery date. To be accepted for return on the basis of this Article herein, System should be unopened, uninstalled, undamaged, resellable, should not be disassembled or modified, and should not have been subjected to conditions exceeding the applicable specifications or ratings within the user and installation manuals. Optosecurity reserves the right to refuse or accept at its discretion the right to return the System and License.

All Systems are returned at Customer’s risks and expenses. Removal of System shall only be performed by Optosecurity or an authorized certified Optosecurity service agent. Should Customer return System, Customer shall reimburse Optosecurity for all expenses incurred by Optosecurity or its agents for removal of System. Customer shall pay a restocking fee of fifty percent (50%) of System and License fees described in the Quotation, or be reimbursed deposits and amounts paid in excess of fifty percent (50%) of System and License fees, as the case may be. Installation, Training and Services may not be reimbursed. Any Systems which are not in catalogue or which are customized may not be returned.

WASTE ELECTRICAL AND ELECTRONIC EQUIPMENT - Optosecurity is a software producer and hardware is mostly produced by third parties. To the fullest extent possible, Optosecurity will convey to Customer any third-party terms and conditions related to WEEE. Customer understand that it is and will remain responsible at all times for the collection, treatment, recovery and environmentally sound disposal of any applicable Waste Electrical and Electronic Equipment (“WEEE”) directives in force in its country, which may be amended from time to time. Customer agrees to take full responsibility of ensuring that Systems is disposed of correctly and to comply with all such applicable WEEE Regulations in connection with the Products. Customer agrees that Optosecurity will not accept returns and cannot accept WEEE returns for recycling, neither will it make arrangements for its collection ,and will not be responsible for all associated financial charges related to the System. 

END OF AGREEMENT - Should Customer decides to cancel an order within ten (10) days after order and before delivery, Customer shall be responsible to pay for an administration fee of ten percent (10%) of all fees described in the Quotation, or be reimbursed for all deposits and amounts paid in excess of ten percent (10%) of all fees described in the Quotation, as the case may be. Should Customer end the Quotation within the period beginning eleven (11) days after order and before delivery, Customer shall be responsible to pay fifty percent (50%) of System and License fees described in the Quotation, or be reimbursed deposits and amounts paid in excess of fifty percent (50%) of System and License fees described in the Quotation, as the case may be. Customer shall be responsible to pay all Installation and Training fees described in the Quotation for services performed. Should Customer end the Quotation for any Systems which are not in catalogue or are non-stock items at any time, Customer shall be responsible to pay for all related fees. 

Should a party breach a material term of the Quotation and fail to correct such breach within the thirty (30) days following written notice, the other party may terminate the Quotation. Customer understands that if it is in default under the Quotation, it may not use those System and Services ordered. Provisions that survive termination or expiration include those relating to limitation of liability, infringement indemnity, payment and such others, which by their very nature, are intended to survive termination.

WARRANTIES, DISCLAIMERS AND EXCLUSIVE REMEDIES - Optosecurity warrants that the System sold to Customer will operate in all material respects as described in the Quotation, for one (1) year after Acceptance Date for hardware and (90) ninety days for software, unless extended warranty is purchased, and described in the Quotation. Optosecurity warrants that Installation, Training and Services will be provided in a professional manner consistent with industry standards. 

To the full extent permitted by law, this warranty is exclusive and there is no other express or implied warranty or conditions. THERE ARE NO WARRANTIES OF QUALITY OR OWNERSHIP OR CONDITIONS OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR ANY OTHER REPRESENTATIONS, WARRANTIES OR CONDITIONS, EXPRESSED OR IMPLIED, STATUTORY OR OTHERWISE, OTHER THAN THOSE DESCRIBED IN THE QUOTATION. Without limiting the generality of the foregoing, Optosecurity neither makes nor authorizes any person, company or agents to make any other warranty concerning its System.

Without limiting the generality of the foregoing but for greater certainty, OPTOSECURITY DOES NOT GUARANTEE THAT THE SYSTEM WILL PERFORM ERROR-FREE OR UNINTERRUPTED, THAT (i) IT WILL DETECT ALL PROHIBITED PRODUCTS OR SUBSTANCES, (ii) IT WILL DETECT A PARTICULAR PRODUCT OR SUBSTANCE IN ALL CASES, (iii) IT WILL NOT WRONGFULLY DETECT OR IDENTIFY A PRODUCT OR SUBSTANCE AS BEING A PROHIBITED PRODUCT OR SUBSTANCE, OR (iv) THAT OPTOSECURITY WILL CORRECT ALL SYSTEM ERRORS. OPTOSECURITY MAKES NO REPRESENTATION WITH RESPECT TO THE ADEQUACY OF PRODUCTS FOR ANY PARTICULAR PURPOSE OR WITH RESPECT TO ITS ADEQUACY TO PRODUCE ANY PARTICULAR RESULT. 

Without limiting the generality of the foregoing but for greater certainty, OPTOSECURITY DOES NOT WARRANT THAT THE SYSTEM WILL WORK PROPERLY IN THE EVENT OF REPEATED POWER FAILURES OR OF VOLTAGE FLUCTUATION AND PARTY ACKNOWLEDGES THAT OPTOSECURITY WILL NOT BE RESPONSIBLE FOR ANY DAMAGES TO THE SYSTEM RESULTING FROM SUCH CAUSES. 

This warranty shall not apply to any System that has been disassembled, modified, physically or electrically damaged, inappropriately installed, repaired without authorization, or any System that has been subjected to conditions exceeding the applicable specifications or ratings within the user and installation manuals. 

This warranty does not apply to third party programs and third party hardware. With respect to third party programs and third party hardware, Optosecurity will convey to Customer, to the fullest extent possible, the warranties provided by Optosecurity’ licensors or manufacturers. In the case of third party programs and third party hardware, Customer accepts to be bound by the T&Cs of the end-user agreement provided, if any.

In order to receive warranty remedies, Customer must notify Optosecurity of any warranty System and License deficiencies within one (1) year after Acceptance Date. Customer must notify Optosecurity of any Installation, Training or Services warranty deficiencies within thirty (30) days from performance of such services.

For any breach of the above warranty terms, Customer's exclusive remedy, and Optosecurity’ entire liability shall be (i) the correction of System errors that cause breach of the warranty, or (ii) the re-performance of deficient Installation, Training or Services. 

LIMITATION OF LIABILITY AND INDEMNITY - Customer acknowledges and agrees that Optosecurity and its agents, directors, officers and employees (the “Indemnified parties”) SHALL NOT BE LIABLE FOR ANY PROPERTY DAMAGES, PERSONAL INJURY, OR ANY INTERRUPTION OF BUSINESS, OR ANY LOSS OF PROFITS, REVENUE, DATA OR DATA USE, OR ANY ECONOMIC LOSS (INCLUDING ANY LOSSES RELATED TO A DELAY CAUSED BY THE SYSTEM), INCURRED THROUGH THE USE OF OPTOSECURITY’S SYSTEM, INSTALLATION, TRAINING OR SERVICES, OR INABILITY TO USE OPTOSECURITY’S SYSTEM, INSTALLATION, TRAINING OR SERVICES, INCLUDING AS A RESULT OF (i) ANY FAILURE OF SYSTEM TO DETECT ANY PROHIBITED PRODUCT OR SUBSTANCE OR (ii) ANY WRONGFUL DETECTION OR IDENTIFICATION BY THE SYSTEM OF A PRODUCT OR SUBSTANCE AS BEING A PROHIBITED PRODUCT OR SUBSTANCE. 

IN ADDITION, THE INDEMNIFIED PARTIES SHALL NOT BE LIABLE FOR ANY LOSS OR DAMAGES TO ANY EQUIPMENTS, DEVICES, SOFTWARE OR APPLICATIONS INCURRED THROUGH THE USE OF OPTOSECURITY’S SYSTEM, INSTALLATION, TRAINING OR SERVICES.

IN NO EVENT SHALL INDEMNIFIED PARTIES BE LIABLE TO PARTY FOR INDIRECT, INCIDENTAL, SPECIAL, EXAMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES, HOWEVER CAUSED, WHETHER FOR BREACH OF WARRANTY, CONTRACT, TORT NEGLIGENCE, STRICT LIABILITY OR OTHERWISE, INCURRED THROUGH THE USE OF OPTOSECURITY’S SYSTEM, INSTALLATION, TRAINING OR SERVICES, OR INABILITY TO USE OPTOSECURITY’S SYSTEM, INSTALLATION, TRAINING OR SERVICES, INCLUDING AS A RESULT OF ANY FAILURE OF SYSTEM TO DETECT ANY PROHIBITED PRODUCT OR SUBSTANCE, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

Customer shall defend, indemnify and save harmless Indemnified parties from all losses, liabilities, damages, claims, proceedings and suits (including, taxes and related penalties, if applicable) and all related costs and expenses (including any and all reasonable legal fees and disbursements and reasonable costs of investigation, litigation, settlement, judgment and appeal, together with interest and penalties), including for injury, death or damage to persons or property: (i) suffered or incurred by the Indemnified parties as a result of the breach by the Customer of, or the use by the Customer of System, Installation, Training and Services other than in accordance with the Quotation; or (ii) suffered or incurred by Customer or by any other person arising in relation to, as a result of use of System, Installation, Training or Services, or the inability to use System, including as a result of any failure of System to detect any prohibited product or substance.

OPTOSECURITY’S MAXIMUM LIABILITY SHALL NOT EXCEED THE AMOUNT PAID TO OPTOSECURITY BY CUSTOMER UNDER THE QUOTATION IN CONNECTION WITH EACH INDIVIDUAL DEFECTIVE SYSTEM UNIT.

FORCE MAJEURE - Neither Optosecurity nor Customer will be liable for any failure or delay in its performance under these T&Cs due to reasons beyond its reasonable control, including act of God, earthquake, flood, riot, embargo, sabotage, governmental act, terrorism and failure of Internet, provided the delaying party gives the other party prompt notice for such cause.

NONDISCLOSURE - By virtue of the Quotation, Optosecurity and Customer may have access to any and all data and information developed by any of Optosecurity and Customer that is otherwise confidential. Both Optosecurity and Customer agree to disclose only that information specifically required for the performance of obligations under the Quotation. A party’s confidential information shall not include information that: (i) is or becomes a part of the public domain through no act or omission of the other party; (ii) was in the other party’s lawful possession prior to the disclosure and had not been obtained by the other party either directly or indirectly from the disclosing party; (iii) is lawfully disclosed to the other party by a third party without restriction on the disclosure; or (iv) is independently developed by the other party.

Both Optosecurity and Customer agree to disclose information only to those employees or agents who are otherwise required to protect it against unauthorized disclosure.

Both Optosecurity and Customer agree to disclose the T&Cs and the terms of the Quotation, including pricing, only to those employees or agents who are otherwise required to protect it against unauthorized disclosure.

Notwithstanding the above, nothing in the T&Cs shall prevent either party from disclosing the terms or pricing within the Quotation, in any legal proceeding arising from or in connection with the Quotation, or disclosing the information to a Federal or State/Provincial entity as required by law.

MODIFICATION OF THESE TERMS AND CONDITIONS - Optosecurity reserves the right to change the Terms and Conditions at any time.  Optosecurity shall provide Customer with a prior 30-day notice.

GOVERNING LAW - This Agreement is governed by the laws of the Province of Quebec and Optosecurity and the Customer agree to submit to the exclusive jurisdiction of, and venue in, the courts of Montreal, Quebec in any dispute arising out of or relating to this Agreement. 

Optosecurity and Customer agree to comply fully with all relevant international and party country laws in regard to export, sales of arms, and chemicals, biological and nuclear proliferation.

NOTICE - Any notice required or permitted to be given under the T&Cs shall be provided in writing and sent to Optosecurity, 1280, Lebourgneuf Blvd., Suite 420, Quebec, Quebec, Canada, G2K 0H1, or by fax +1 418-657-3851 or by email at finance@optosecurity.com, to the attention of: Chief Financial Officer

SEVERABILITY - Should any provision of the T&Cs be deemed contrary to applicable law and/or unenforceable by any court competent jurisdiction, such provision shall be considered severed from the Quotation but all remaining provisions shall continue in force. If there shall be any conflict between the T&Cs and the provisions of a signed agreement, including the quotation, the latter shall prevail.