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    General Terms of Sale

    General Terms of Sale


    1. Definitions

    1.1 "Agreement” – These general terms of sale together with the Purchase Order and all other attachments specified in them.

    1.2 “Customer” – The entity who addresses the Purchase Order, as specified in the Agreement. For the sake of the Agreement, Customer shall include its representatives, affiliated companies, and successors as well acting on his behalf under the Agreement.

    1.3 "Deliverables" – Shall mean collectively the Products and the Services as detailed herein and shall be interpreted according to the applicable and relevant meaning.

    1.4 “Delivery Point” – Agreed location of delivery of the Deliverables to Customer or its forwarder, which shall be also detailed in the Purchase Order.

    1.5 "Effective Date” – Date by which the Agreement becomes effective upon its signature and Approval by both Parties.

    1.6 "General Terms of Sale" – these General Terms of Sale.

    1.7 “Parties” – Customer and SCD.

    1.8 “Party” – Customer or SCD as the case may be.

    1.9 “Price” – Price of Deliverables to be paid to SCD by the Customer under the Agreement, as set out in the Purchase Order.

    1.10 "Price Proposal" – The Price Proposal provided to Customer by SCD in connection with the Agreement.

    1.11 “Products” – The goods specified in the Purchase Order which SCD is required to deliver under the Agreement as detailed and agreed upon in the Spec, or any part thereof.

    1.12 "Purchase Order" – A Specific Purchase Order, provided by Customer to SCD in accordance with the Agreement.

    1.13 "SCD" – Semiconductor Devices Ltd.

    1.14 "Services" – The specified and agreed work which SCD is required to perform under the Agreement, as detailed in the SOW, or any part thereof.

    1.15 "SOW" – The agreed statement of work.

    1.16 "Spec" – The agreed technical specification.


    2. General

    2.1 These General Terms of Sale apply to all Price Proposals made by SCD and all purchase orders for SCD's Deliverables provided by SCD to its customers, unless otherwise agreed upon in writing.

    2.2 SCD 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 in accordance with the agreed prices and terms of payment as detailed in the Agreement.

    2.3 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:

    2.3.1 A Purchase Order issued by Customer and duly approved by SCD;

    2.3.2 The Price Proposal;

    2.3.3 The most recent and applicable Spec;

    2.3.4 The SOW;

    2.3.5 These General Terms of Sale;


    3. Acceptance of Purchase Orders

    3.1 Unless subsequently negotiated and otherwise agreed upon, Purchase Orders from Customers shall be solely based on SCD's Price Proposal and the prices, quantities and schedules specified in it.

    3.2 Only Purchase Orders that SCD accepts and confirms in writing to the Customer shall bind SCD and SCD shall otherwise have no obligation to accept Purchase Orders from Customers.


    4. Delivery

    4.1 SCD 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 current Incoterms rules. In the event of any contradiction between the Agreement and the Incoterms the terms and conditions of the Agreement shall apply.

    4.2 Unless otherwise agreed upon by the Parties, Delivery Point shall be FCA Ben Gurion International Airport, Israel.

    4.3 Early delivery of up to 2 (two) months from the original delivery date is allowed subject to prior notification from SCD to Customer.

    4.4 Deliverables shall be packed in the best commercial manner normally used by SCD for shipment of the same kind of Deliverables, or as agreed in the Agreement, whichever applicable.

    4.5 Title to the Deliverables shall pass upon Delivery. However, SCD shall maintain security interest in the delivered Deliverables until the respective full and final payment is received from the Customer. Risk of loss of or damage to the Deliverables shall pass to the Customer upon Delivery.

    4.6 All the delivered Deliverables shall be free and clear of any and all liens, encumbrances or any other claims of any nature whatsoever.


    5. Acceptance Tests

    5.1 SCD shall perform acceptance tests at SCD's facility on the Deliveries according to SCD's custom and relevant acceptance test procedures ("ATP").

    5.2 Acceptance certificate of conformance ("COC") signed by SCD'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 the Customer according to the agreed requirements of the Agreement.

    5.3 A Customer may, at its option and sole cost and expense, observe the formal testing of the Deliverables at SCD’s facility on a non-interference basis, in accordance with SCD’s security and internal procedures and solely upon prior coordination. In no event however shall SCD be delayed in its testing schedule because of a Customer’s inability to provide the appropriate personnel to witness the testing.


    6. Warranty

    6.1 Subject to the provisions set forth in the Agreement, and unless otherwise detailed in SCD's Price Proposal and if not, agreed upon by the Parties and specified in the Purchase Order, SCD 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.

    6.2 Acceptance and rejection of Deliverables

    6.2.1 Within 10 (ten) working days from Delivery, the Customer shall notify SCD in writing of acceptance or rejection of the Deliverables. If a Customer did not notify SCD of accepted or rejected deliverables within 10 (ten) working days, the delivered Deliverables shall be automatically deemed unconditionally accepted by Customer.

    6.2.2 In case of rejected Deliverables solely due to non-conformance with the agreed specification, SCD will be responsible for reasonable transport costs from the Customer to SCD at the Delivery Point and back to the Customer at the Delivery Point. Customer will notify SCD prior to shipping any Deliverables back to SCD and shall request and obtain from SCD a Return Material Authorization ("RMA") number.

    6.2.3 SCD shall, replace or repair, at its sole discretion and at SCD's sole responsibility and liability, rejected Deliverables which are demonstrated to SCD's satisfaction to have been at the time of delivery to Customer, defective in material or workmanship or not in conformance with the Spec.

    6.3 Rejection of Deliverables during the Warranty Period

    6.3.1 Defective Deliverables returned by a Customer to SCD during the Warranty Period which are demonstrated to SCD's satisfaction to be defective in material or workmanship under the provided warranty shall be, at SCD's sole responsibility and liability, repaired or replaced by SCD and at SCD's option. SCD will be responsible for reasonable transport costs for the defective Deliverables from the Customer to SCD at the Delivery Point and back to the Customer at the Delivery Point. Customer will notify SCD prior to shipping any Deliverables back to SCD and shall request and obtain from SCD a RMA number.

    6.3.2 During the Warranty Period, SCD shall provide the repaired or replaced Deliverables to Customer, within an agreed Turn-Around-Time ("TAT") from SCD's receipt of the defective Deliverables under a Warranty claim.

    6.3.3 The Warranty Period of the repaired or replaced units shall be for the remaining original Warranty Period of the Deliverables.

    6.4 Outside the Warranty Period, SCD shall provide repaired or replaced units of Deliverables to the Customer, subject to the terms of a separate agreement to be mutually agreed-upon and signed between the Parties.

    6.5 SCD shall not be responsible nor bear any costs of the Customer or of any third party relating to removing Deliverables or any part of them from and installing/reinstalling a replacement/repaired Deliverables in the Customer's equipment.

    6.6 SCD shall have no obligation under this Warranty Article unless the applicable Deliverables have been installed, operated, handled, maintained and stored in strict accordance with the current recommendations of SCD as stated in its manuals and/or other written instructions provided to the Customer, and provided that said items have not been subject to accident, abuse, misuse or misapplication, negligence, neglect, alteration or repairs which have been attempted by any party other than SCD or SCD’s authorized representatives, non-conformities that result from the 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, acts or omissions of the Customer or third parties or by combination of the Deliverables with additional ones.

    6.7 The value of SCD's liability shall not in any case 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.



    7. Changes

    7.1 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.

    7.2 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.

    7.3 Within 30 (thirty) days of receipt of such notice from the Customer regarding a Class I Change, SCD will provide the 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.

    7.4 SCD has the right to request Class I Changes to the Deliverables. Such requests shall detail the reasons for the changes and their expected effects. Customer shall respond to SCD's request within 14 (fourteen) days. Following receipt of the Customer's approval SCD shall have the right to implement the changes.

    7.5 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 will notify the Customer on the details of the Class II Changes. If the Customer's Objection to the required Class II Changes is not provided within 7 (seven) days, SCD shall be free to implement the changes, provided that such changes are based on SCD's good faith determination that such changes will not degrade reliability or performance.

    7.6 Any and all other changes, including inter alia changes in time table and delivery shall be requested and agreed upon in writing and each Party shall respond in writing to such request by the other Party.

    7.7 All agreed upon changes taken into account shall be properly updated, signed and documented as an amendment to the Agreement by the Parties.


    8. Liability




    9. Impropriety

    9.1 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.

    9.2 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.

    9.3 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.

    9.4 Customer shall conduct its activities pursuant to this Agreement in a manner that will reflect favorably on SCD, and shall avoid any deceptive, corrupt or misleading practice.

    9.5 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.

    9.6 Each Party shall notify the other Party immediately after it becomes aware of any infringement of any of the provisions of the Agreement or the possibility of one.

    9.7 Each Party shall be responsible to inform its relevant employees, subcontractors and anyone on its behalf acting under the Agreement of its provisions, and to enforce its full compliance.


    10. Proprietary Rights and Confidentiality

    10.1 "Proprietary Information" as used herein means any and all information, including confidential information, disclosed by one Party to the other, its employees, agents and assignees, 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).

    10.2 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's subcontractors, subject to equivalent confidentiality obligations, if such disclosure is required for SCD in order to fulfill its obligations under the Agreement.

    10.3 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 assignees, 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.

    10.4 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 all other industrial or rights owned by either Party will continue to be fully owned by such Party and when developed by SCD in connection with the Agreement shall remain solely and explicitly vested with SCD.

    10.5 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.

    10.6 The Provisions of this article shall survive the termination or expiration of the Agreement.


    11. Prices

    11.1 Prices for all Deliverables shall be as specified in SCD's Price Proposal attached to the Agreement.

    11.2 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 with respect to sale of the Deliverables, or on the Agreement itself. All applicable taxes shall be borne by Customer and If SCD is required by law to directly pay any such taxes, fees, excises, and/or charges, Customer shall promptly reimburse SCD upon SCD’s presentation to Customer of a receipt acknowledging such payment


    12. Terms of payment

    12.1 Terms of Payment shall be as agreed upon and set out in SCD's Price Proposal or Price Agreement attached to the Agreement. Payment shall be made via wire transfer unless otherwise agreed upon.

    12.2 Any changes to payment instructions or wire information for SCD's accounts require a secondary verification via a personal call with SCD's accounting department.

    12.3 Unless otherwise explicitly agreed upon, Terms of Payment are net 30 (thirty) days from receipt by Customer of the applicable invoice from SCD.

    12.4 All payments due from Customer to SCD pursuant to the Agreement shall be made in freely transferable USD.


    13. Third Party Rights

    13.1 To the best of SCD'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.

    13.2 In the event of a third party claim or threat of a claim, SCD may decide under its sole discretion to defend the Customer from finally adjudicated judgments, provided that the Customer informs SCD immediately of the claim, assists SCD in the defense of the claim and provides SCD with the sole control of the defense and settlement of the claim.

    13.3 SCD's shall under no circumstances become liable under this section unless an adjudicated judgement is provided thereof by a competent authority.

    13.4 In a case of SCD found liable in an adjudicated judgement, SCD, 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.

    13.5 SCD is not responsible for infringement caused by integration of the Deliverables with another apparatus or component or modifications to the Deliverables.

    13.6 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.


    14. Development, Non-Recurring Engineering Fees and Prototypes

    14.1 SCD and Customer may agree upon development of new Deliverables and prototypes or modification or adaptation of existing Deliverables by SCD ("Development").

    14.2 In the event Customer pays non-recurring engineering fees (“NRE”) for SCD'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 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.

    14.3 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 and no license to use or right is granted to Customer thereof.


    15. Transfer of Deliverables and Export Control

    15.1 The Deliverables may be regarded as controlled items and accordingly, the Parties shall comply with all relevant and applicable export control or other laws and regulations.

    15.2 SCD shall be responsible to procure a valid Export and/or Marketing License if required, and Customer shall be responsible to provide the required End-Use Statements, additional documentation and details and procure a valid Import License, all to the required extent.

    15.3 The customer acknowledges and confirms that it will not transfer or export the Deliverables, under no circumstances, without SCD's prior written consent and the proper export or other required licenses, unless otherwise mutually agreed upon in advance in writing.

    15.4 SCD's compliance with this requirement is contingent upon receipt from Customer of all necessary assistance, support, details 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 shall bear no responsibility whatsoever for any failure to comply with the requirements of the Agreement, resulting directly or indirectly from failure of the Costumer to provide any required assistance, support, details or documentation as mentioned herein.

    15.5 It is agreed and acknowledged that provision by SCD of the Deliverables may require that Customer will furnish an End-Use Statement for the application of the relevant export licenses. Notwithstanding the provisions of these General Terms of Sale, failure to provide the aforementioned End-Use Statement shall relieve SCD of its obligations to supply the Deliverables subject thereof, until such Statement has been received and the required license has been issued by the applicable authorities in Israel.

    15.6 Upon obtaining the relevant Export and/or Marketing License, SCD shall inform the Customer of any limitations or provisions that may affect Customer’s use of the Deliverables, or which may affect SCD’s ability to comply with its obligations under the Agreement.

    15.7 Where a failure or delay of SCD to comply with its obligations under this article and/or the Agreement is due to governmental acts, omissions or sanctions (including changes in governmental policy prior to or following the issuance of a Marketing or Export License or simple delays in the provision of a required license or approval) the failure will constitute a Force Majeure event as detailed herein with no further liability to SCD.


    16. Assignment

    16.1 Any terms and conditions of this Agreement which by nature are intended to survive the termination or expiration of this Agreement shall survive such termination or expiration

    16.2 Either Party shall have the right to terminate this Agreement and any relevant Purchase Order with immediate effect in the event the other Party enters into corporate reorganization or other proceedings which may conflict with the terminating Party’s interests.

    16.3 In any case of early termination by the Customer of the Agreement or any derived Purchase Order, the Customer shall compensate SCD for all work-in-progress, finished products and all raw material and items acquired by SCD in connection with the execution of the Agreement and derived Purchase orders for the customer.


    17. Assignment

    17.1 Unless otherwise approved by both Parties in advance and in writing, neither Party may assign, delegate, subcontract or otherwise transfer in any manner any of its rights and/or obligations under the Agreement nor any part thereof.

    17.2 Notwithstanding the forgoing, a change of incorporation or ownership structure shall not be regarded as an assignment and shall not require the other Party's prior consent but will require a written notification to the other Party.


    18. 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.


    19. Force Majeure

    19.1 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, international sanctions, any civil commotion, riot, insurrection or hostilities, significant cyber event, epidemics, labor shortages or disputes and work stoppages, global significant shortages, 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.

    19.2 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.


    20. Disputes and Governing Law

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

    20.2 All disputes between the Parties shall be first referred to the Parties' leading management for an amicable attempt to reach an understanding and settle the dispute.

    20.3 Disputes which the Parties fail to solve within 30 (thirty) days, shall be finally and exclusively presented to and settled by the competent court in either Tel Aviv or Haifa, Israel.


    21. Privacy and Cyber Security

    21.1 Each Party shall explicitly and fully comply at all times with all the requirements of the privacy acts and regulations applicable to it, and shall manage and maintain at all times the necessary and adequate systems, enabling him with the means to appropriately collect, process, transfer, control, protect, use and destroy any personal information.    

    21.2 Each Party shall manage and maintain at all times, an IT and cyber security systems, sufficient for the purpose of performing its commitments and derived actions to the other Party including the proper securing of the other Party's Proprietary Information.

    21.3 In any case of infringement or breach of a Party's IT systems which leads or may lead to an affect, disclosure or obtainment of the other Party's Proprietary Information, related personal information, or any part thereof, the breached Party shall immediately notify the other Party and advise on the actions taken to minimize the damages and unauthorized disclosure of the Proprietary Information and/or the personal information.

    21.4 The breached Party shall be liable for any damages and cost affected on the other Party and the assuming of all cost and actions required to handle the breach until its proper finalization.


    22. Notices
    All notices and other communications shall be possible via Email, 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:


    Customer: SCD:
    As agreed and detailed in the Purchase Order

    SCD - Semiconductor Devices Ltd.
    Leshem Industrial Park
    P.O.BOX 2250,
    Haifa 3102102, Israel
    Tel: (+)972-4-9902500



    23. 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.


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


    25. 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.

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