Terms

SHELLBACK SEMICONDUCTOR TECHNOLOGY

CONTRACT TERMS & CONDITIONS

These Contract Terms and Conditions (“Terms and Conditions”) apply to any Systems purchased from Seller (defined below) by the Purchaser identified on the face page of the Quotation or the purchaser order, including the terms contained in the Quotation mutually signed, executed or agreed to in writing by Purchaser and Seller.

Definition
The term “Quotation” shall refer to the quote issued by Seller with respect to the System, including any purchase order for the System (including any parts or components thereof) that is placed by Purchaser and accepted by Seller with respect thereto.

The term “Seller,” means Shellback Semiconductor Technology, LLC, a Delaware limited liability company, and all of its affiliates whether now or hereafter existing, including Rite Track Equipment Services, LLC, an Ohio limited liability company.

The “System” shall include those products, components, services or systems identified in the applicable Quotation.

Software & License Agreement Terms
License Grant. The System is supplied with original software embedded for standard tool utilization (“Software”), unless otherwise notated in the Quotation. Seller grants to Purchaser a limited, non-assignable, non-transferable, non-exclusive, revocable, royalty free license (without the right to sublicense) for use solely in Purchaser’s internal business operations, and solely with each System purchased from Seller: (i) the patented methods and processes of Seller in existence as of the delivery date of the System to Purchaser’s facility; (ii) Software and any Updates thereto, solely in object code form; and (iii) all System-related or Service-related documentation made available by Seller directly or through its Web site (“Documentation”). “Updates” means new versions, including maintenance releases, and localizations and translations thereof, of the Software that contain bug fixes, error corrections and minor enhancements, but not containing major enhancements or significant new functionality, as determined in Seller’s sole discretion, and any related Documentation. Unless otherwise specified in the Quotation, the licenses do not extend to the use of Software or Documentation on or with items of equipment or parts not purchased from Seller, or modified by any third party, and any and all such use of the Software is expressly not authorized. This grant is limited for use with the System and purpose for which the Software is obtained. Use of this Software for any purpose other than for which it is intended terminates this grant of a license. The Software and Documentation is licensed, not sold, to Purchaser. Any breach of the Quotation or these Terms and Conditions by Purchaser automatically terminates this license. The term of the licenses granted in this Section is the duration identified in the Quotation or, if none is specified, perpetual unless terminated in accordance with these Terms and Conditions.

Restrictions. Any use of the Software not expressly permitted by this Agreement is prohibited. Purchaser will not: (i) transfer the Software or the System to any third party without Seller’s prior written consent, which consent may be withheld in Seller’s sole and absolute discretion, (ii) use the Software to process (or permit the Software to process) data for any third party, (iii) lease, sublease, sublicense, sell, distribute, transfer, encumber, rent, or grant other rights in the Software or engage in service bureau work, application or “cloud” service provider services or other commercial hosting or time-sharing arrangements with respect to the Software, (iv) take any action that would cause the Software to be placed in the public domain, or (v) permit any third parties to use the Software. In addition, Purchaser will not reproduce, modify, copy, publish, translate, decompile, disassemble, reverse engineer, or distribute the Software or Documentation in any form or by any means. These Terms and Conditions will be binding upon and inure to the benefit of the parties and their respective successors and permitted assigns. Any other purported attempt to do so is void.

Patents & Intellectual Property
All patents and intellectual property that is included or embedded in the System which is owned or licensed by Seller shall be and remain the sole and exclusive property of Seller or its licensors, as applicable. Purchaser is granted a license (or sub-license if applicable) to use said patents and intellectual property only as required in order to use the System. All patents and intellectual property provided with the System are to be treated as Confidential Information (defined below) of Seller and shall not be disclosed to any third party and shall remain the sole and exclusive property of Seller.

Process Kits
Process kits are always supplied by the Purchaser unless stated in the Quotation.

Source Inspection
Seller shall permit the System to be demonstrated at Seller’s facility under the conditions defined in Seller’s source inspection and final test documents, which meet the original equipment manufacturer’s system specifications (if Seller is not the manufacturer). Process demonstration will be limited to inert, non-corrosive, non-toxic equipment and procedures. Should Purchaser waive the opportunity to attend a source inspection as set forth above, any source inspection sign-off milestone will automatically occur and Seller may commence with shipment of the System.

Shipment
Shipping will be made in accordance with the shipping schedule that is set forth in the Quotation or as otherwise mutually agreed upon in writing by the Purchaser and Seller. Seller shall ensure that packing technique, preparation and materials are consistent with the nature of the System and the hazards of transportation. At Purchaser’s request, Seller will coordinate the shipment of the System using the carrier of Purchaser’s choice.

Confidentiality
Definition of Confidential Information. “Confidential Information” means all confidential and proprietary information of a party (as the disclosing party) disclosed to the other party (as the receiving party), whether orally or in writing, that is designated in writing as confidential or that reasonably should be understood to be confidential given the nature of the information and the circumstances of disclosure including, without limitation, all regulatory, commercial, financial (including pricing information), administrative and technological information of either party and any information concerning these Terms and Conditions and the Quotation. Confidential Information does not include any information that, without breach of any obligation owed to the disclosing party: (i) is or becomes generally known to the public, (ii) was known to the receiving party prior to its disclosure by the disclosing party as substantiated by the receiving party’s previously existing written records, (iii) was independently developed by the receiving party without use of or reference to the Confidential Information of the disclosing party, or (iv) is received from a third party who was not bound by confidentiality obligations with respect to such Confidential Information. If the receiving party is compelled by law to disclose Confidential Information of the disclosing party, it will provide the disclosing party with prior notice of the compelled disclosure (to the extent legally permitted) and reasonable assistance, at the disclosing party’s cost, if the disclosing party wishes to contest the disclosure.

Obligations regarding Confidential Information. The receiving party will (i) protect the confidentiality of the disclosing party’s Confidential Information in the same manner that it protects the confidentiality of its own confidential information of like kind (but in no event using less than reasonable care), (ii) not use any of the disclosing party’s Confidential Information for any purpose outside the scope of this Agreement, except with the disclosing party’s prior written consent, (iii) disclose Confidential Information of the disclosing party only to those of the receiving party’s employees, consultants and contractors who have a need to know such information and who have agreed, either as a condition of employment or in order to obtain the Confidential Information, to be bound by terms and conditions substantially similar to those terms and conditions applicable to the receiving party under this Agreement, and (iv) promptly notify the disclosing party if it becomes aware of any actual or suspected breach of confidentiality of the disclosing party’s Confidential Information. The receiving party will be liable for any breach of the obligations of confidentiality by its employees, consultants or contractors.

Validity of Quotation
The System and all parts and equipment are subject to availability. Under no circumstance shall Seller be obligated to source or ship from any specific location, utilize expedited shipping methods or work overtime to ensure System and part availability or on-time delivery.

Controlling Document
The prices, terms and conditions quoted herein are firm through the expiration date stated, unless modified in writing by Seller prior to acceptance of the Quotation. All Quotations shall be subject to, and expressly conditioned upon Purchaser’s acceptance of and the application of these Terms and Conditions. Any new, different or additional terms and conditions in any writing of Purchaser are expressly rejected and null.

The acceptance by Seller of Purchaser’s Purchase Order is expressly made conditional upon Purchaser’s assent to the terms and conditions set forth herein, and Seller agrees to furnish the Systems and any spare parts and services covered thereby only upon these Terms and Conditions. These Terms and Conditions document and the Quotation document constitute the entire agreement of the parties with respect to the subject matter hereof. No waiver, alteration, or modification of any of the provisions hereof shall be binding on Seller unless made in writing and signed by an authorized representative of Seller. All Quotations must be approved and accepted by Seller. These Terms and Conditions shall be applicable whether or not they are attached to or enclosed with the System sold hereunder.

Payment
Payment for the System and services is due at or before shipment of the System or provision of services, unless Seller grants credit in writing. If credit is granted, credit terms for any sale hereunder shall require payment in U.S. Dollars thirty (30) days from date of invoice and for Systems, payment in U.S. Dollars is due per the schedule set forth in the Seller’s Quotation. Unless Seller’s Quotation provides to the contrary, final payment is due no later than net thirty (30) days from the date of invoice. Seller reserves the right to require an irrevocable letter of credit from a bank, which it designates. Sums unpaid thirty (30) days after date of invoice shall be subject to a late payment charge of one and one-half percent (1.5%) per month from the due date, or the maximum amount permitted by applicable law, if less; and, in addition, Purchaser shall pay all costs incurred by Seller which relate to the credit extension. In the event of any default in payment, Purchaser shall pay all costs of collection (including reasonable attorneys’ fees). Seller reserves the right to retain payments already made to Seller and apply said payments to payments required by Purchaser. Seller further reserves the right to setoff or recoup any amounts which Purchaser may owe to Seller from any amounts which Seller may owe to Purchaser (including any credits).

Security Interest
Seller retains a security interest in the System delivered hereunder and in proceeds from the sale, exchange, collection, or disposition thereof, until Purchaser has made payment in full for the System. Purchaser shall, upon request by Seller, provide all information and signatures required by Seller to perfect such security interest, Seller reserves all rights granted to a secured creditor under the Uniform Commercial Code and the Uniform Commercial Code applicable to Purchaser, including the right to repossess the System upon default by Purchaser. To simplify such repossession, Seller may require the Purchaser to assemble the collateral and make it available to the Seller at a place reasonably convenient to both parties and agreed upon by the Seller.

Delivery and Delay
Unless otherwise set forth in the Quotation, terms of sale are ExWorks (EXW). Title to the System shall pass to Purchaser on Seller’s tender of the System to Purchaser or a carrier. All risk of loss or damage of the System in transit shall be borne by Purchaser, unless otherwise agreed in writing. Seller reserves the right to make partial deliveries, and all such partial deliveries shall be separately invoiced and paid for when due. Delay in delivery of any installment shall not relieve Purchaser of its obligation to accept such later deliveries. In any event, delivery times shall not be considered absolute and under no circumstances shall Seller be liable or responsible for failure to deliver by any specific date.

Force Majeure
Seller shall not be liable for any failure to perform or any delay in performing due to any cause beyond Seller’s control, including but not limited to, acts of God, acts of Purchaser, fire, theft, accident, flood, war, sabotage, slowdown, strikes, or other labor difficulties, riot, embargo, government act, regulation, rule, ordinance or request (including voluntary compliance therewith) or inability to obtain necessary labor, materials, manufacturing facilities, utilities or transportation. In the event of any such contingency, the date of performance or delivery shall be extended by a period equal to the time lost by the delay. If, due to any such contingency Seller is unable to supply the entire quantity specified in the Quotation, Seller shall have the right to allocate its available supply among customers and its departments and divisions in any manner deemed reasonable to Seller. Seller shall not make or participate in any shipment which does not conform to the requirements of the U.S. Export Administration Act or any other relevant export-import law or regulation.

Taxes and Other Charges
Any manufacturer’s tax, sales tax, use tax, excise tax, custom, inspection or testing fee, or any other tax, fee, or charge of any nature whatsoever imposed currently or in the future by any federal, state, or other governmental authority, upon or with respect to the sale, purchase, delivery, shipment, storage, processing, use, or consumption of any of the System covered hereby, including taxes, fees, or charges upon or measured by the receipts from the sale thereof, shall be borne by Purchaser in addition to the prices quoted or invoices. In the event Seller is required to pay any such tax, fee, or charge, Purchaser shall promptly reimburse Seller therefore.

Cancellations for Convenience, Shipment Holds, and liquidated damages whereby the Purchaser may request a delay in delivery for a maximum of ten (10) business days from the contract scheduled delivery at no charge, and the Seller shall proceed with completion of the work. Purchaser’s payments shall in such event be due and payable to Seller with the contract scheduled delivery. In the event Purchaser is unable to receive the System at the time Seller is prepared to make delivery, Seller may, upon notice to Purchaser, giving Purchaser reasonable opportunity to designate a location for storage, deliver the System and ship it to storage at any suitable location including Seller’s facilities, with all costs incurred by Seller as a result including but not limited to preparation for the placement into storage, inspection, insurance, rental fees, and any taxes being borne by Purchaser. Seller will take commercially reasonable steps to minimize such expenses. When Purchaser is ready to receive the System, Seller shall arrange, at Purchaser’s expense, removal of the System from storage and shipment of the System to Purchaser.

Purchaser has the right to cancel the Quotation for convenience upon prior written notice. A request by Purchaser for delay in delivery beyond ten (10) working days from the contract delivery date shall be deemed to be a cancellation of the contract. The parties agree that contract cancellation by Purchaser would cause substantial damage to Seller in an amount that would be difficult to ascertain,; and therefore Purchaser shall pay liquidated damages for cancellation in accordance with the table set forth below.

Unless otherwise stipulated in the Quotation, canceled orders shall be subject to cancellation charges as a function of the number of weeks Seller received notice before the stipulated delivery date as follows or Purchaser will be responsible for all costs related to the project to date plus 25% of Quotation value:

Notice Received Prior to Stipulated Shipping Date: Percentage of Liquidated Damages to pay (based upon Quotation price)
Percent of Face Value of PO
Fewer than 2 weeks: 100%
2 to 4 weeks: 90%
4 to 6 weeks: 70%
6 or more weeks: 50%

Limitation of Liability
Seller’s liability on any claim of any kind, whether based in contract, in tort (including negligence and strict liability) or otherwise for any expense, injury, loss, or damage arising out of or in connection with the provision of any service or the design, manufacture, sale, delivery, inspection, repair, maintenance, installation, or use of the System furnished under this contract shall in no case exceed the purchase price of the System or service which gives rise to the claim. In no event shall Seller be liable for any special, indirect, incidental, consequential, or contingent damages, including loss of profits, revenue, income, savings, goodwill, business opportunity or use, whether or not Seller has been advised of the possibility of such damages or the damages were otherwise foreseeable and whether or not all other remedies have failed of their essential purpose.

Patent and Trademark Indemnity
Seller accepts no liability for, and Purchaser hereby agrees to indemnify, defend and hold harmless Seller and its affiliates and their respective offices, directors, owners, agents, employees and representatives (collectively, “Seller Indemnitees”) from and against any and all claims, demands, suits, judgments, settlements, costs, expenses, damages, liabilities, fees, fines, penalties or losses (including reasonable attorneys’ fees and court costs) (collectively, “Losses”) arising in connection with allegations of infringement of patents, trademarks, or other intellectual property rights of others arising from Seller’s use or incorporation into the System of Purchaser’s design, formulae, processes, specifications, or Seller’s compliance with Purchaser’s instructions or requirements that a design be produced to perform a specific process or achieve a specific result.

Warranty and Returns
Seller warrants to the Purchaser that the System provided by Seller shall conform to the published specifications and shall be free from defects in material and workmanship when used under normal operating conditions, and that all service provided by Seller shall be performed in a workmanlike manner.

The foregoing warranty shall apply to such period of time and under such conditions as are specified in Seller’s standard warranty for the System as designated in the applicable Quotation. If not otherwise specified in the Quotation, the warranty for Systems shall apply for ninety (90) days from the date of shipment. The warranty provided hereunder shall not include parts or materials which the Seller considers as consumables under normal operating conditions. During this warranty period, the Purchaser shall perform all monthly preventative maintenance checks prescribed in the relevant original equipment manufacturer’s equipment manual (to the extent Seller is not the manufacturer).

With respect to spare parts, the foregoing warranty shall apply for a period of thirty (30) days from the date of shipment of the spare parts by the Seller. The warranty granted hereby shall not include spare parts which Seller considers as consumables under normal operating conditions.

With respect to services, the foregoing warranty shall apply for a period of thirty (30) days from performance of the service.

EXCEPT AS EXPRESSLY SET FORTH HEREIN, SELLER MAKES NO OTHER REPRESENTATIONS OR WARRANTIES, WHETHER EXPRESS OR IMPLIED, INCLUDING WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE OR NON-INFRINGEMENT, AND ALL SUCH WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED AND EXCLUDED. FURTHERMORE, SELLER MAKES NO REPRESENTATION OR WARRANTY THAT THE SYSTEM, COMPONENTS, OR ANY SOFTWARE OR OTHER INTELLECTUAL PROPERTY PROVIDED IN CONNECTION THEREWITH WILL BE ERROR FREE OR UNINTERRUPTED OR WILL ACHIEVE ANY PARTICULAR RESULTS.

If the System delivered hereunder does not meet the above applicable warranty during the applicable warranty period, Purchaser shall promptly notify the Seller and make the System available for correction. Seller shall, as Seller’s sole and exclusive liability and Purchaser’s sole and exclusive remedy for warranty issues, either repair, replace or issue a refund with respect to the defective System, in each case as determined in Seller’s sole discretion. Any repairs by Seller shall occur during Seller’s normal business hours. If a spare part delivered hereunder does not meet the above spare parts warranty, Purchaser shall promptly advise Seller and, upon obtaining a Return Material Authorization, ship the defective spare part to the Seller at Purchaser’s expense so that Seller may, as Seller’s sole and exclusive liability and Purchaser’s sole and exclusive remedy for spare parts warranty issues, either repair, replace or issue a refund with respect to the defective spare part, in each case as determined in Seller’s sole discretion. If the service provided hereunder does not meet the above warranty, Purchaser shall promptly notify Seller and make the affected System available for correction. Seller shall, as Seller’s sole and exclusive liability and Purchaser’s sole and exclusive remedy for service warranty issues, either correct or issue a refund with respect to the defective service, in each case as determined in Seller’s sole discretion. Any corrections to defective Services shall occur during Seller’s normal business hours.

In the event Seller authorizes a System to be returned by Purchaser pursuant to the foregoing warranty, the returned System must be accompanied by a Return Material Authorization signed by an authorized representative of Seller. Seller is under no obligation to accept, inspect, replace, or repair unauthorized shipments, and the Purchaser shall bear all expenses incurred by such unauthorized shipments to Seller unless specifically noted otherwise in writing by Seller. Return of the System constitutes Purchaser’s authorization for Seller to repair the System and to invoice Purchaser for any and all reasonable costs of repair, labor, parts, and freight on items not covered by the terms of this warranty., including without limitation charges for handling of returned items found not defective, as well as a fifteen percent (15%) restocking charge for spare parts. Purchaser shall bear the risk of loss or damage during transit of the System whether or not the System meets warranty requirements. Any returned parts or Systems shall become the property of Seller.

Under no circumstances shall Seller be obligated to repair or replace the System rendered defective (or any part or component thereof), in whole or in part, by external causes, such as but not limited to catastrophe, power failure or transients, over-voltage on interface, environmental extremes, or improper use, maintenance, or application.

To the maximum extent permitted by applicable law, Seller’s total and aggregate liability arising from the sale or use of the System or service shall be limited to the cost of correcting defects, as provided herein, or the price allocable to the System or part thereof which gives rise to the claim, or the amount of the appliable Quotation, whichever is least. All such liabilities will terminate upon expiration of the warranty period.

Indemnification
In the event the System or any part thereof is subjected to, or a claimed defect arises as a result of, accident, misuse, neglect, alteration, failure to install or removal of safety devices provided or required by the original equipment manufacturer, unauthorized relocation, or improper repair or maintenance or is installed, maintained, or used contrary to Seller’s printed warnings, instructions or recommendations, Purchaser agrees to defend, protect, indemnify, and hold Seller Indemnitees harmless from and against all Losses of any kind, whether based in contract, in tort including negligence or strict liability, which may arise out in connection therewith except those Losses caused solely by defects in materials or workmanship by Seller or by the sole negligence of Seller.

No Assignments
Purchaser shall not transfer or assign any of its rights or obligations hereunder, whether in whole or in part, without the prior written consent of Seller, which may be withheld in Seller’s sole discretion.

Purchaser Hiring Practices
Without the prior written consent of Seller, Purchaser will not, directly or indirectly, alone, through, or with any other person or persons, in any manner, for the period of two years after the later of the last date of contact or the date hereof directly or indirectly solicit or entice away from Seller any person who at the date hereof is an officer, manager or employee of Seller whether or not such person would commit a breach of contract by reason of leaving service or transferring business; or employ or otherwise engage the services of any such officer, manager or employee, except as such employment or engagement may be accomplished pursuant to the consummation of a transaction with Seller as contemplated by this Agreement.

Delaware Law and Disputes
These Terms and Conditions, including any Quotation to which they apply, shall be governed by and construed in accordance with the laws of the State of Delaware. Any action based on this contract must be commenced within one (1) year after the cause of action arises and must be brought exclusively within the federal and state courts located in the State of Delaware.

Parts Rush/Expedite Terms, Minimum Order Size and Returning New Parts Policies
1. Tool Down Orders
Seller shall endeavor to engage all available resources to get in-stock Tool Down/Expedite orders out the same day. However, depending on what time of day the order is received, Purchaser acknowledges and agrees that the order may be shipped the next day. The following applies to those Tool Down/Expedite orders:

  • US and international customers with EXW and FOB Plant terms will be charged a $100 USD expedite fee.
  • All customers with DAP terms (old DDU terms) will be charged a $200 USD expedite fee, which includes additional “priority” shipping charges to approved locations. This will apply to all parts ordered that fit within a single (one) carton of “parcel size and weight”. The maximum “parcel size and weight” specifications per each Tool Down/Expedite order must not exceed the following dimensions: 24” x 12” x 12”, and must have a gross shipping weight equal to or less than 30 US pounds. A package exceeding these specifications will be subject to additional freight charges which will be charged to Purchaser at the time of shipment. The method of transportation will be at the sole discretion of Seller.

2. Minimum Order Size
Unless otherwise set forth in the Quotation, Purchaser with DAP terms are subject to a minimum order of $250.00 USD; and Purchaser with EXW or FOB Plant terms are subject to a minimum order of $100.00 USD.

3. Returning New Materials for Credit, Policy and Changes
All new, unused, undamaged Seller parts still in their original sealed packaging may be returned to stock for credit only if accompanied by a Return Material Authorization Form (“RMA”) signed by an authorized representative of Seller. Parts that are special-ordered or that are modified to Purchaser’s specifications are not eligible to be returned for credit under any circumstance. All parts for which an RMA is accepted by Seller which were originally shipped under EXW or FOB Plant will be charged a 20% restocking fee; and parts for which an RMA is accepted by Seller which were originally shipped under DAP terms shall be charged a 30% restocking fee. In each case, the balance of the returned part credit shall be posted to Purchaser’s original account. No cash refunds will be issued under any circumstances. Authorized returns must be received by Seller, freight prepaid, with Purchaser bearing the risk of loss or damage during transit. All returned parts are subject to inspection upon receipt by Seller, and if found to be noncompliant with the foregoing conditions, shall be rejected and held for only 30 days for Purchaser to collect (at Purchaser’s expense), thereafter, such rejected parts may be scrapped by Seller in Seller’s discretion.

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