VICONE TERMS AND CONDITIONS

AGREEMENT FOR DEVELOPMENT AND SUPPLY

1. General

Subject to the terms of this Agreement, Vicone shall deploy its best efforts to collaborate with the Client with respect to the development of the products requested by the Client (the “Products”), if applicable, and shall supply and deliver the Products for sale to the Client in accordance with the specifications provided and/or approved by the Client and agreed to by Vicone. Where required, the Client must approve samples of the Products and where the Client issues to Vicone written confirmation to proceed with production, the Client hereby acknowledges and recognizes that such approval shall be construed as acceptance and approval of the samples and the Products and, upon said approval, renounces to any claims against Vicone in relation to the performance or quality of the Products for which samples were approved.

2. Orders and Quotations

All orders received by Vicone from the Client shall be construed as offers to purchase and may be accepted or rejected by Vicone in its sole discretion. All quotations by Vicone are valid for a maximum of sixty (60) days.

3. Delivery

Vicone agrees to work to meet the delivery dates requested by the Client. However, the Client agrees and acknowledges that any requested delivery date or dates are not binding on Vicone. Any and all lead times for new parts (tooling) are approximate only. New tooling may require additional time due to debugging and fine-tuning. Although Vicone will do its utmost to maintain quoted lead times, it does not guarantee lead times for R&D or new tooling/samples. Tolerance on shipped quantities shall be +/- 15%. Vicone may ship in partial multiple deliveries.

4. Forecasts

The Client shall use its best efforts to provide Vicone, on a regular basis, with quantity forecasts for the Products, as the Client shall require for supply by Vicone. The Client shall also provide to Vicone reasonable prior notice of any changes in forecasts as they become known to the Client. The Client hereby acknowledges and recognizes that any such forecasts are non-binding upon Vicone and no liability to Vicone shall be derived from any such forecasts. The client is required to receive and pay for any and all inventories produced, work in progress, or raw materials either in stock or committed to at or by Vicone based on said forecast and/or any letter of intent or commitment, whether written, verbal or implied.

In addition, if and when the Client issues an open order by which he requests Vicone to produce and/or order and/or store a determined amount of Products for possible deliveries to the Client at indefinite intervals, or otherwise on agreed dates, and subsequently fails to take full delivery of said products before the final delivery date as established by Vicone, or at the latest one (1) year after the issuance of the open order, or on the agreed delivery dates, the Client hereby agrees to pay Vicone the full price of such Products, whether or not there is delivery, in addition to any storage and handling charges, as determined by Vicone. The Client further agrees that upon expiration of the final dates above, and/or when the agreed delivery deadlines have not been respected by the Client, Vicone will be entitled to modify the prices of said products.

5. Intellectual Property, Development, Moulds, Dies and Tooling

The Client hereby recognizes that Vicone’s know-how and intellectual property has been relied upon for the development, design and manufacture of any parts, moulds, dies and/or tooling necessary for production purposes regarding the Products. The Client also hereby recognizes that Vicone’s know-how and intellectual property has been relied upon for any development of Products. Vicone shall remain the sole owner and holder of all intellectual property rights with respect to and/or in connection with any products designed with or by Vicone on behalf of the Client, unless Vicone assigns to the Client, in writing, all said intellectual property entitlements.

Should the Client so request and upon the termination of this Agreement for any reason, Vicone hereby undertakes to ensure the destruction of the parts, moulds, dies and/or tooling produced specifically in relation to the Products produced for the Client with evidence of such destruction, should said parts, moulds, dies and/or tooling be prepared by also making use of intellectual property owned by the Client. In all circumstances, Vicone shall not be obligated to remit any such parts, moulds, dies or tooling.

Should, notwithstanding the foregoing, the Client request the remittance of any parts moulds, dies or tooling and Vicone accepts to remit any of the foregoing to the Client, Vicone shall be entitled to obtain from the Client prior to said remittance, the reimbursement of any and all costs associated with the remittance including any transportation costs, custom fees and any administration costs required to effect said remittance.

In addition, the client hereby acknowledges and recognizes that Vicone’s prices for said parts, moulds, dies and/or tooling for development of Products (and delivery of prototypes) are established on the assumption that Vicone will proceed with purchase orders from the Client for ulterior manufacturing and production of the Products for at least one year, based on quoted annual usage, commencing from the first production order which must be within 18 months of the development cycle by Vicone of the Products (the “1-year Purchase Orders”), unless otherwise expressly indicated by Vicone.

In the event the Client prematurely requests the remittance of any parts, moulds, dies or tooling prior Vicone having completed and invoiced for the work associated with the 1-year Purchase Orders or should the Client fail to duly and completely issue the 1-year Purchase Orders, Vicone shall be entitled to require from the Client reasonable compensation equivalent to 200% the price charged for the NRSC/Development charge.

6. Warranties and Defective Products; Indemnification

Vicone warrants and represents that the Products and all Components: (a) are free from defects in materials and workmanship, and conform strictly to the approved samples and Specifications; (b) meet or exceed the standards of quality prevailing in the industry for similar products, the whole taking into account the specifications provided; and (c) shall be new and unused at the time of initial delivery.

THIS WARRANTY EXPRESSLY LIMITS ANY LIABILITY OF VICONE FOR BREACH OF WARRANTY TO REPAIR OR REPLACEMENT OF THE PRODUCTS AND DOES NOT GRANT ANY WARRANTY, EITHER EXPRESS OR IMPLIED, LEGAL OR CONVENTIONAL, AND DISCLAIMS ANY AND ALL IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR PARTICULAR PURPOSE AND VICONE SHALL, UNDER NO CIRCUMSTANCES, BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, EVEN WHERE VICONE HAS BEEN ADVISED OF THE POSSIBLITY OF SUCH DAMAGES AND VICONE’S LIABILITY SHALL IN ALL CASES BE LIMITED TO REPAIR OR REPLACEMENT OF THE PRODUCTS.

7. Interest

The Client hereby accepts to pay Vicone interest at the rate of two percent (2%) per month (24% per annum) on any overdue unpaid balance.

8. Default and Remedies

In the event the Client defaults or fails to comply with each and every term hereof, notably in relation to making due payments to Vicone, the Client hereby recognizes and acknowledges Vicone’s right to forthwith terminate this Agreement. All sums due to Vicone shall be due by acceleration. In the event the Client is in default of its payment obligations to Vicone, Vicone shall be entitled to withhold delivery of any additional Products without any liability whatsoever to Vicone. Furthermore, in the event of a default on the part of the Client, the Client hereby accepts to pay all reasonable legal or collection fees, including reasonable attorney fees incurred by Vicone in order to recover all sums owing to Vicone in accordance herewith. To that end, the Client hereby acknowledges and recognizes that attorney fees equivalent to twenty-four percent (24%) of the value of any claim by Vicone shall constitute reasonable attorney fees to be paid by the Client to Vicone in addition to any other amounts owing to Vicone.

9. Inspection, Acceptance and Returns

The Client shall inspect all Products purchased from Vicone immediately upon receipt. The Client shall be deemed to have accepted all Products delivered to it unless the Client sends written notice of rejection to Vicone no later than thirty (30) days following the Client’s receipt of such Products. Should a notice of rejection be issued to Vicone accordingly, Vicone shall communicate with the Client to determine the nature of the defect and the Client hereby agrees to cooperate fully with Vicone so that Vicone may adequately analyze the Client’s claim in that regard. No Products may be returned to Vicone without Vicone’s written authorization in the form of an RGA/RMA. If the Client rejects any products, Vicone may, in its sole discretion, 1) cancel the order and terminate this Agreement, 2) ship replacement products to the Client, or 3) extend the Client credit equal to the amount paid for such Products. If Vicone determines that returned Products are conforming, the Client will be assessed a service charge. Any Products which are substantially conforming to the initial samples approved by the Client shall be presumed to be compliant.

10. Governing Law and Election of Domicile

This Agreement shall be governed by, interpreted, construed and enforced in accordance with the laws of the Province of Quebec. Furthermore, the parties hereto irrevocably submit to the jurisdiction of the Courts of the District of Montreal with respect to any claims or any disputes arising from any rights or obligations provided for in this Agreement.

The parties hereby confirm their express wish that the present Agreement be drawn up in English. Les parties reconnaissent leur volonté expresse que le présent contrat soit rédigé en langue anglaise.