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Aplix Solution Terms & Conditions

Effective date: April 1, 2018

This Aplix Solution Terms & Conditions (including the Terms of Sale as defined in section 1.0; collectively the "Agreement") is by and between Aplix Corporation, an Japanese corporation ("Aplix") and the entity agreeing to be bound by these terms as evidenced by the signature of such entity's authorized representative on the Aplix engagement letter referencing this Agreement ("Client"), and is made effective on the date set forth in the engagement letter ("Effective Date"). Aplix develops and sells hardware IoT sensor modules and gateways, develops and licenses related software, and manages a cloud-based network service, for purposes of enabling Internet-of-Things (IoT) communication and interaction between consumer and commercial products and a mobile device application. Client wishes to purchase access to Aplix technology, products and services pursuant to this Agreement.

1.0 PRODUCTS

Aplix agrees to sell Aplix certain hardware products ("Products") to Client via Client's Aplix-accepted purchase orders ("Binding Orders") under the then-standard Aplix Terms and Conditions of Product Sales that accompany Aplix's acceptance of Client's purchase order, or, if none, the terms set forth below in Schedule A ("Terms of Sale"), for the version and model of Products, and at the prices and delivery terms, specified in the Binding Order. Client acknowledges that Products are only available directly from Aplix or Aplix's designated party, and will be sold directly to Client and not to any other party on Client's behalf.

2.0 SERVICES

2.1 Aplix may provide to Client certain development, consulting, application hosting, SaaS, and professional services as set forth in the engagement letter ("Services"). As part of the Services, Aplix will enable the Products to communicate with Aplix's standard Product-compatible mobile device application (the "App"), available on application platforms, such as Google Play, Apple iTunes App Store, Amazon, and/or other similar platforms, that Aplix in its sole discretion elects to support ("App Store(s)"). Aplix makes no warranties as to App Store acceptance and will have no liability for failure or delays of the application to be accepted, for withdrawal of acceptance, for lack of App Store accessibility for any reason, errors in transmission of payments or reporting, or for the acts and omissions of the owners or operators of any App Store or changes in any App Store policies. Aplix will use commercially reasonable efforts to host the App and maintain its availability on the App Store(s) during a subscription period commencing upon first availability of the App on any App Store and ending three years later, except as may otherwise be stated in the engagement letter referencing these terms ("Subscription Term"). Thereafter, the Subscription Term will automatically renew for subsequent one-year periods unless either party issues thirty days written notice of termination, whereupon the Subscription Term will end at the end of such thirty-day notice period. Client acknowledges and agrees that Aplix and its successors will be the sole and exclusive distributor of the App and cloud service. At or after the end of the Subscription Term, availability of the App and all Services related to the App may automatically terminate without notice. Client's payment obligations will continue beyond the Subscription Term until availability is terminated in Aplix's sole discretion.

2.2 Client will provide to Aplix, and Client acknowledges that Aplix’s ability to successfully provide Services depends on, reasonable and necessary cooperation and assistance.

2.3 Client hereby grants to Aplix and its affiliates the right to copy, distribute, deploy, display, perform and modify "Client Property" (defined as any content, materials, information, software, web pages and other works that Client provides to Aplix or directs Aplix to use in furtherance of Aplix's provision of Services, or for incorporation into or for display with the App), in furtherance of Aplix's provision of Services and as necessary or desirable for Aplix's use with the App.

2.4 Client consents to the collection and use of data and personal information as set forth in the Aplix Privacy Policy.

2.5 As a material condition, Client shall require its customers, agents, dealers or other parties, to whom Client resells the Aplix products or with whom Client engages in the promotion or marketing of the Aplix products, to sign a written acknowledgement and agreement to consent to and be bound by the Aplix Product Warranty and Liability Statement.

3.0 PAYMENTS.

All payments under this Agreement are due within thirty days of Aplix's invoice date, or as otherwise set forth in this Agreement. Payments for the Services are based in part on the usage of activated sensors via a counting method determined by Aplix and described on the Aplix invoice. All payments required by this Agreement will be made in US dollars, are nonrefundable and are not subject to set-off, retention or counterclaim. Payments will be paid by wire transfer or other Aplix-approved manner in immediately available funds to a bank account designated by Aplix. Aplix may on notice terminate or suspend Services or withhold the App, or withhold Product deliveries, in the event Client is delinquent in the payment of any invoice from Aplix. Any payments that are not timely paid as provided hereunder will bear compound interest at the rate of the lower of (a) one and one-half percent per month; or (b) the highest rate permitted by applicable law. Aplix is entitled to enforce payment obligations hereunder in any court of competent jurisdiction, notwithstanding any term to the contrary in this Agreement (and the parties acknowledge that Aplix's entitlement to do so is not subject to arbitration). Aplix may revoke any credit extended to Client due to Client's failure to pay an invoice when due or for any other similar reason, and to suspend any shipments until Client's account is current. Payments are not tied to acceptance. All payments required by this Agreement are exclusive of taxes or similar charges and Client will be responsible for the payment of all such taxes (excluding only taxes based on Aplix's income). To the extent Client is required by local law to withhold or deduct taxes based upon Aplix's income from any payments owed hereunder, such payments will be increased (grossed up) in such amounts as would have been received by Aplix as if no such withholding or deduction was required.

4.0 CONFIDENTIALITY.

Neither party may use, except in furtherance and for the purposes of receiving and providing Services, or disclose (except to such party's employees and contractors under obligations of confidentiality), the other party's "Confidential Information", defined as any written or oral information or materials disclosed during the Services and in furtherance and for the purpose of receiving and providing Services hereunder, if designated as "confidential" in writing by the disclosing party, or if disclosed orally, designated as "confidential" by the disclosing party at the time of disclosure and summarized in writing by the disclosing party within thirty days of disclosure. Each party will protect the confidentiality of the other party's Confidential Information to the same degree of care, but no less than reasonable care, as such party uses to protect its own confidential information. Each party's obligations regarding Confidential Information in this section will expire three years from the date of receipt of the Confidential Information. The obligations of this section will not apply to any portion of Confidential Information which a receiving party can demonstrate: (a) is now, or hereafter through no violation of this Agreement, becomes generally known; (b) is independently developed by the receiving party without any use of Confidential Information; (c) is hereafter rightfully furnished to the receiving party by a third party without restriction on disclosure; (d) was rightfully known to or lawfully in the possession of the receiving party at the time of disclosure; (e) is disclosed by the disclosing party to a third party without restriction; or (f) is hereafter required to be disclosed pursuant to a legal proceeding or otherwise required by law, provided reasonable prior notice is given to disclosing party with sufficient opportunity to contest or limit such disclosure.

5.0 TERM AND TERMINATION

5.1 This Agreement will commence on the Effective Date. A Subscription Term will continue until terminated in accordance with this section 5.0. This Agreement or any Subscription Term will terminate at any time: (a) upon thirty days written notice by the non-terminating party in the event of a material breach by the party given notice, provided such party fails to cure the breach within such thirty day period; (b) at Aplix's option in the event that either party ceases to conduct its operations in the normal course of business, becomes insolvent, files for or becomes the subject of a bankruptcy petition, or is placed in receivership; or (c) at either party’s option in the event the other party attempts to assign or transfer in whole or in part this Agreement in violation of this Agreement.

5.2 Either party may terminate Services for convenience on thirty days written notice to the non-terminating party, provided that Client's right to terminate for convenience is conditioned on Client's compliance with the payment obligations of this Agreement. For clarity, at the end of the Subscription Term, or upon termination of Services or this Agreement for any reason, Aplix will have no further obligations to host and maintain the App, and Client shall cease any use and promotion of the App.

5.3 Upon termination for any reason, Aplix's obligations under this Agreement will terminate, Client will pay to Aplix any outstanding fees owed at the time of termination, and each party will promptly destroy or return all copies of the other party's Confidential Information (except for archived copies used for legal retention purposes). Sections 2.3, 2.4, 3.0, 4.0, 5.2, 5.3, 6.0, and 7.0 will survive termination of this Agreement.

6.0 LIMITATION OF LIABILITY

6.1 All "Results" (defined as those works, items and materials that Aplix delivers to Client or develops pursuant to the performance of Services, including the App and related web and App Store pages), Products and Services are provided as-is, as-available, and with all faults. ALL EXPRESS OR IMPLIED REPRESENTATIONS AND WARRANTIES, INCLUDING ANY WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, DESIGN, TITLE OR NON-INFRINGEMENT, OR ARISING FROM COURSE OF DEALING, COURSE OF PERFORMANCE OR TRADE PRACTICE, ARE HEREBY DISCLAIMED. Aplix assumes no responsibility or liability under this Agreement or otherwise for defects, errors, deficiencies, or delays to the extent resulting from causes beyond Aplix’s reasonable control, including defects, errors or failures caused by the operating system, the network environment, end users, external viruses, third party applications, platforms, or data delivery services, or changes in any of the foregoing, and Client hereby releases and holds harmless Aplix from any such problems. For clarity, Client acknowledges that the radio signal emitted from the Products is an open signal that is capable of being received by any conforming device and application.

6.2 Notwithstanding any other provision of this Agreement, Aplix's maximum aggregate liability for all claims, liabilities or obligations arising under or relating to the "Subject Matter" (defined as this Agreement (and its performance or non-performance), Results, Products, and the Services), regardless of the theory of liability, whether for breach of this Agreement, including breach of warranty, or in tort or otherwise, will in no event exceed all amounts paid by Client to Aplix for the particular Service or Result giving rise to the claim, if any during the one-year period preceding the claim. In no event will Aplix be liable for any indirect, punitive, special, incidental or consequential damages in connection with, related to or arising out of the Subject Matter, or liable for interruption of business, loss of profits, savings, opportunities, use, data, or other economic advantage, or the cost of cover or replacement, regardless of the theory of liability, whether for breach of this Agreement, including breach of warranty, or in tort or otherwise, even if Aplix has been previously advised of the possibility of such damages. Liability for damages will be so limited and excluded, regardless of the validity or efficacy of any remedy under this Agreement or otherwise, and even if any such remedy fails of its essential purpose. Client has voluntarily agreed to define the parties’ rights, liabilities and obligations respecting the Subject Matter exclusively in contract pursuant to the terms of this Agreement, and Client disclaims that Client is owed any duties or is entitled to any remedies not expressly set forth in this Agreement.

7.0 GENERAL TERMS

7.1 This Agreement is not intended to create a relationship such as a partnership, franchise, joint venture, agency, or employment relationship. Neither party may act in a manner that expresses or implies a relationship other than that of independent contractor, nor bind the other party. Neither party's employees are eligible for the employee benefits or compensation offered by the other party. Client will have no right to control the means, manner or method by which Aplix performs Services. Aplix has sole discretion over assignment and replacement of Aplix personnel involved in provision of Services, and may subcontract Services. No exclusivity or exclusive rights are provided by Aplix under this Agreement. Notwithstanding any other provision of this Agreement, Aplix and its staff may freely utilize in perpetuity and without obligation to Client: (a) general knowledge, experience, skills and know-how acquired during the performance of Services; and (b) any feedback, benchmarks, requirements, recommendations, ideas, and error corrections provided by Client to Aplix relating to Aplix's products and services. Nothing in this Agreement constitutes an assignment or transfer of ownership of either party's intellectual property rights.

7.2 In addition to section 3.0, Aplix's provision of the App and associated network services is funded by internet business models, including without limitation affiliate models and payments based on clicks and impressions.

7.3 Client hereby authorizes Aplix to include Client, and the projects in which Aplix was engaged, in Aplix's demo portfolio videos, web sites, advertisements and publicity, provided that such materials describe project(s) that have been publicly announced or released, and provided that, prior to issuance of any press release to contain Client executive quotation, Aplix attempts to secure Client's prior written consent, not to be unreasonably withheld (and Client will respond to Aplix's request within five business days). Nothing in this or any other agreement shall be construed to preclude Aplix from compliance with disclosure obligations imposed by the securities laws or regulations of any government or public stock exchange, and Client consents to disclosures as required by such laws or regulations. Notwithstanding any other provision of this Agreement, neither party is granted any interest, right, title or license to, or is to own or be the beneficiary of an assignment of, the other party's trademarks, service marks, domain names, trade names, designs, trade dress or other intellectual property rights, and will not: (a) challenge the ownership or use of same; (b) attempt to register same; or (c) incorporate same into such party's trademarks, service marks, company names, Internet addresses, domain names, or any other similar designations. Aplix and/or its licensors retain ownership rights in, and as between the parties, Aplix is and will be the sole and exclusive owner of the Results and all intellectual property rights associated therewith.

7.4 Except as otherwise set forth in this Agreement, this Agreement may not be assigned or transferred, or its rights or obligations assigned or delegated, by either party, in whole or in part, without the prior written consent of the other party, and any purported delegation, transfer or assignment in violation of this section will be void; provided, however, that Aplix may assign this Agreement to an affiliated entity or in the event of a merger, acquisition or sale of business or assets, without the need for prior consent.

7.5 This Agreement will be fairly interpreted in accordance with its terms and without any strict construction in favor of or against either party. The terms "includes" and "including" will not be construed to imply any limitation. Except as expressly noted, this Agreement confers no third party rights and creates no third party beneficiaries of any kind. This Agreement is the parties' entire agreement relating to its subject matter. It supersedes all prior or contemporaneous oral or written communications, proposals, negotiations, understandings, representations and warranties, and prevails over any conflicting or additional terms of any quote, order or other communication between the parties relating to its subject matter. This Agreement may only be modified by a writing signed by both parties' authorized representatives. Any express waiver or failure to exercise promptly any right under this Agreement will not create a continuing waiver or any expectation of non-enforcement. If any of the provisions of this Agreement are held to be in violation of applicable law, void, or unenforceable in any jurisdiction, such provisions are waived, amended or reformed to the extent necessary for the Agreement to be otherwise enforceable in such jurisdiction.

7.6 This Agreement, the Subject Matter, and all related disputes will be governed by the procedural and substantive laws of California and controlling US law. The choice of law rules of any jurisdiction that would require the application of another state's laws, and the United Nations Convention on the International Sale of Goods, will not apply. A party prevailing in any litigation or arbitration related to the Subject Matter will be entitled, in addition to such other relief as may be granted, to an award of reasonable attorneys' fees. Any dispute between the parties related to the Subject Matter that cannot be resolved informally will be referred to binding arbitration to JAMS (jamsadr.com) in accordance with the expedited rules of same in effect at the time of arbitration, as the sole and exclusive means of such dispute resolution. The arbitral proceedings will be conducted in the English language, and all hearings will take place in San Francisco, California. The existence of any dispute between the parties, the existence or details of the arbitration proceeding, and all related documents, materials, evidence, judgments and awards therein, will be kept strictly confidential, except as required by law or for enforcement. All awards may if necessary be enforced by any court having jurisdiction, in the same manner as a judgment in such court. The parties hereby waive the right to a trial by jury and agree to only bring claims in an individual capacity and not as a plaintiff or class member in any purported class or representative proceeding. Nothing herein will be deemed to preclude either party from pursuing provisional or injunctive relief at any time (thereby bypassing arbitration) in any court of competent jurisdiction (and the parties acknowledge that either party's right to do so is not arbitrable).



Schedule A – Terms & Conditions of Product Sales

These Terms and Conditions of Product Sales, including the Warranty Statement as defined in paragraph (H) below (“Terms”) constitute a legally binding contract between Aplix Corporation, organized under the laws of Japan (“Aplix”), and a purchaser (“Purchaser”) of Aplix hardware modules (the “Product(s)”), as more particularly described and confirmed in a purchase order submitted by Purchaser from time to time to Aplix for Aplix's acceptance (in Aplix's sole discretion), and which will apply to and govern Purchaser’s individual orders of the Products (“Purchase Order(s)”). All Purchase Orders issued to Aplix by Purchaser will be governed by these Terms, notwithstanding any (preprinted or other) terms and conditions on Purchaser's Purchase Order. Any terms in Purchaser's documents or communications are hereby deemed to be material alterations and notice of objection to and rejection of them is hereby given.

A) Shipments are INCOTERMS (2010) FCA, Purchaser's designated carrier, except as Aplix may otherwise agree in its Purchase Order acceptance. Purchaser bears risk of loss upon Aplix's delivery to carrier (regardless of whether Aplix assumes responsibility for shipment). If Purchaser requests Aplix to arrange for shipment, Purchaser will pay Aplix for all costs of shipment, insurance and associated expenses, and Aplix may utilize any reasonable shipping method available. Aplix may charge setup and/or handling fees for orders of less than a minimum unit threshold as set by Aplix. Purchaser will be responsible for all import duties, taxes and any other expenses incurred or licenses or clearances required. Aplix may deliver Products in installments or partial shipments as Aplix elects and a delay or default in delivery of any installment will not relieve Purchaser of the obligation to accept and pay for other deliveries. Delivery dates are estimates. Title to the Products transfers to Purchaser upon payment in full.

B) Prior to using or distributing the Products or any systems or components that include the Products, Purchaser will thoroughly test the Products and such systems and components and the functionality of the Products as used in same. Purchaser will promptly inspect the Product upon its arrival at the place of delivery and will notify Aplix, within five business days, if Purchaser finds any nonconformity or defect in the Products. Upon the expiration of such five business day period with no written notice of rejection submitted to Aplix, Purchaser will be deemed to have accepted the Products. Purchaser acknowledges that this right of inspection satisfies inspection rights under applicable law.

C) No cancellation or rescheduling of Purchase Orders by Purchaser within thirty days of Aplix's estimated shipping date will be permitted. Any cancellation or rescheduling by Purchaser more than thirty, but less than ninety, days before Aplix's estimated shipping date may result in a charge to Purchaser, as determined by Aplix. Purchase Orders may be cancelled or rescheduled by Purchaser more than ninety days before Aplix's estimated shipping date without charge or penalty. Notwithstanding the foregoing, if a Purchase Order concerns or the order delivery is to include custom components (specially made for Purchaser), or components branded with Purchaser-designated brands, or specially-ordered or -made third party parts or components, the entire Purchase Order is non-cancelable and non-refundable immediately upon issuance. Aplix may cancel any accepted Purchase Order at any time if written notice of cancellation is given at least thirty days or more prior to the scheduled delivery date.

D) Purchaser and its affiliates, and its and their employees, officers, and agents, will not: (i) remove the shielding case for the Products; (ii) attempt to obtain the model name or number of components within the Products; (iii) use an antenna in conjunction with the Products other than as specified by Aplix; (iv) use an external amplifier in conjunction with the Products; (v) remove, suppress, replace or conceal labels associated with the Products or use or sell Products with altered or missing labels; or (vi) reverse engineer, decompile, breakdown, disassemble or otherwise attempt to derive the source code, data structures, interfaces, techniques, processes, algorithms, know-how or other information from the Products (collectively, "Reverse Engineering") or permit or induce the foregoing. If however, directly applicable law prohibits enforcement of the foregoing, Purchaser may engage in Reverse Engineering solely for purposes of obtaining such information as is necessary to achieve interoperability of independently created software with the Products, or as otherwise and to the limited extent permitted by directly applicable law, but only if: (vii) Reverse Engineering is strictly necessary to obtain such information; and (viii) Purchaser has first requested such information from Aplix and Aplix failed to make such information available under reasonable terms and conditions. Any information supplied to or obtained by Purchaser under this paragraph will not be disclosed to any third party.

E) For those Products that have secured certifications and/or regulatory approvals of standards-setting organizations (such as the Bluetooth SIG) and relevant governmental entities, such approvals and certifications apply only if the Products are used "AS IS" and without modification. The following activities are not covered by any such approvals/certifications, and Aplix assumes no responsibility or liability for any losses, claims, damages, or other ramifications arising from or related to such activities: (i) changes, revisions, or supplements to the switch and sensor other than those as set out in the user manual; (ii) modifications to wireless features, for example, by changing the external amplifier circuit; (iii) modifications or deletions of the circuit in whole or in part; (iv) use with antenna cables other than those designated by Aplix; (v) implementing any changes to the Product's frequency, voltage, power, or current; (vi) any other changes, extensions or alterations of the functionality (inputs and outputs) of the Products not approved by Aplix in writing in advance; and (vii) misrepresentations or inaccuracies as to Product source or branding.

F) If, at the time Aplix's performance hereunder, an export license is required for Aplix to lawfully export Products or technical data, then the issuance of the appropriate license to Aplix or its contractor will constitute a condition precedent to Aplix's obligations hereunder. Purchaser will comply with requirements of all applicable laws and regulations regarding the import and subsequent export of the Products, will be solely responsible to obtain any necessary export license or other documentation prior to the exportation or re-exportation of any product, technical data, or software acquired from Aplix, and will not sell, export, re-export, transfer, divert or otherwise dispose of any such product, technical data, or software directly or indirectly to any person, firm, entity, or country prohibited by applicable laws or regulations. Any product export classification made by Aplix will be for Aplix's internal use only and will not be construed as a representation or warranty regarding the proper export classification for such product or whether an export license or other documentation is required.

G) Purchaser will ensure that (i) all use, distribution, and sale of the Products will be in full compliance with applicable laws and regulations in all jurisdictions where the Products are used, distributed or sold, including telecommunications laws and regulations and related certifications; (ii) that all products containing the Product will comply with the standards and specifications of the Bluetooth Special Interest Group (SIG); and (iii) Products as sold by or for Purchaser are fit for their intended purposes.

H) Aplix provides a limited warranty for its Products, available at http://www.aplix.co.jp/en/legal/warranty.php ("Warranty Statement"). Purchaser hereby acknowledges and agrees to the terms of the Warranty Statement and agrees to be bound thereby.

(end of Aplix Solution Terms & Conditions)
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