TERMS AND CONDITIONS OF SALE

The following Terms and Conditions of Sale (this “Agreement” or these “terms and conditions”) constitute the complete understanding of GPD OPTOELECTRONICS CORP. (“Seller”) and the buyer (“Buyer”) with respect to the matters addressed herein and constitute the entire agreement of the parties. Seller and Buyer are collectively referred to herein as the “Parties.” The Parties hereby agree as follows:

1. Agreement.
   1. An order submitted by Buyer is deemed by Seller to be an offer to purchase, which Seller may accept or reject in its sole discretion. Seller’s acceptance of an offer to purchase is binding on Seller only if made by written instrument (including a written order confirmation) or, if not by written instrument, by shipment of the products ordered (and acceptance by shipment shall only be binding as to the portion of the order actually shipped by Seller).
   2. Seller’s acceptance and all sales of products by Seller shall be subject to the terms and conditions set forth herein, and ALL SALES ARE MADE ONLY ON THE TERMS AND CONDITIONS SET FORTH IN THIS AGREEMENT. If any other terms and conditions have been submitted by the Buyer, they are rejected, and these terms and conditions are proposed as a counteroffer. All subsequent actions shall be pursuant to these terms and conditions and any additional or different terms are hereby objected to and shall not be binding upon the Parties unless agreed to in writing by Seller.
   3. Without limiting the foregoing, if Buyer includes any quality notes in a purchaser order, such quality notes shall only be deemed accepted if included in Seller’s written order confirmation for such order.
2. Delivery and Risk of Loss. Unless otherwise agreed in writing by Seller, all deliveries shall be made and transfer of risk shall take place Ex Works (Incoterms 2020) Seller’s facility. Buyer shall pay the costs of delivery of the products. THE SHIP DATE(S) SET FORTH IN ANY RDER CONFIRMATION ARE APPROXIMATE ONLY, AND SELLER SHALL NOT BE LIABLE FOR A BREACH OF CONTRACT IF SELLER DELIVERS PRODUCTS WITHIN A REASONABLE TIME AFTER SUCH DATE. Seller reserves the right to ship any product up to fourteen (14) days prior to the ship date set forth in an order confirmation.
3. Title to Products. Title to and right of possession of the products sold hereunder shall remain with Seller until all payments provided hereunder shall have been made in full, and Buyer agrees to take all actions necessary to protect and maintain such right and title in Seller. Failure of Buyer to pay the purchase price for any product when due shall give Seller the right, without liability, to peaceably repossess such product with or without notice and to avail itself of any other remedy provided by law.
4. Order Cancellation; Ship Date Changes.
   1. Orders with a ship date scheduled within sixty (60) days are not cancellable by Buyer. Orders cancelled by Buyer (i) more than seventy-two (72) hours after Buyer’s receipt of order confirmation from Seller and (ii) more than sixty (60) days before the scheduled delivery date will incur a cancellation charge of fifty percent (50%) of the total order amount stated on the order confirmation provided by Seller. Notwithstanding the foregoing, non-recurring engineering (“NRE”) costs paid by Buyer are not cancellable or refundable under any circumstances.
   2. Line item confirmed ship dates can be rescheduled by Buyer on a line item by line item basis; provided that (i) such change must be made more than thirty (30) days prior to the original ship date set forth in the order confirmation for such item; (ii) the ship date cannot be extended more Rev. 3 2 than four (4) weeks from the originally scheduled ship date, and (iii) any request for an earlier ship date must be mutually agreed to by the Parties.
5. Terms of Payment.
   1. Unless otherwise stated, terms of payment are net thirty (30) calendar days from the actual ship date for such order (the “Ship Date”), and any sum not paid within thirty (30) days after the Payment Due Date will bear interest until paid at the rate of three percent (3%) compounding monthly. Notwithstanding the foregoing and unless otherwise stated, terms of payment for any NRE costs are net thirty (30) calendar days from the order date appearing on Seller’s order confirmation (the “Order Date”), and any sum not paid within sixty (60) days after the Order Date will bear interest until paid at the rate of three percent (3%) compounding monthly. For terms of payment stated as Payment in Advance, order confirmation shall not be provided for any deliverables associated with the order until receipt of payment for those items listed as Payment in Advance.
   2. In the event of delinquency, Buyer shall be liable for all collection costs including reasonable attorneys’ fees. Buyer shall have no right of set-off or withholding, and no deduction of any amounts due from Buyer to Seller shall be made without Seller’s prior, express written approval.
   3. Payments may be made by Visa, American Express, or Mastercard credit card; provided, that (i) such credit card information must be provided with Buyer’s purchase order (ii) such credit card will be charged for payment of such order on the date that Seller’s order confirmation is provided for such order, and (iii) any such credit card charge in an amount that is less than $1,000 will incur a three percent (3%) processing fee. By providing Seller with credit card information with a purchase order, Buyer authorizes Seller to charge such credit card for such order.
6. Credit Approval. Seller may, but shall not be obligated to, grant credit terms to Buyer in Seller’s sole discretion. Acceptance of any order is subject to final credit approval by Seller. Seller reserves the right to cancel any sale if Seller deems Buyer unable to pay for any products. Seller may, in its sole discretion and at any time, decline to make any shipment or delivery except upon receipt of payment
   or upon terms regarding credit or security satisfactory to Seller.
7. Prices. Prices are subject to change without notice. Prices quoted are valid for thirty (30) days or such other length of time as set forth in a written quotation form from authorized personnel of Seller. Except as expressly stated, prices are in U.S. Dollars and do not include state or local sales or use taxes or any other taxes or any other international regulatory or statutory transaction fees that may be
   applicable to the sale of the product.
8. Taxes and Fees. Buyer shall pay all sales, use, excise, value-added tax or similar taxes, or other charges or international regulatory or statutory transaction fees, which Seller is required to pay, or to collect and remit, to any government (national, state, or local) and which are imposed on or measured
   by the sale.
9. Termination of Orders. Seller may terminate any orders accepted hereunder if Buyer fails to pay any charge when due or fails to perform or observe any term or condition of this Agreement. Similarly, Seller may in its discretion defer further shipments until such default is cured and all payments, late
   fees, and other charges due are paid in full, and Seller shall not be liable for any costs or other damages incurred by Buyer arising from such deferral. Remedies provided herein shall be in addition to, and not in lieu of, other remedies that may be available to Seller under this Agreement or by law.
10. Inspection and Acceptance. Buyer shall have ten (10) calendar days after the date a product is received to inspect such product and to provide Seller with written notice of any deficiency. If there is no such notice given within ten (10) calendar days after the date of receipt of a product, then such Rev. 3 3 product will be deemed accepted and all claims with respect to such product, other than warranty claims pursuant to Section 11(a), will be deemed waived.
11. Limited Warranty.
    1. Except as set forth herein, Seller warrants that for a period of twelve (12) months after the date of shipment of a product that such product will be free from significant defects in material and workmanship and will conform to its published specifications (including, without limitation, any quality notes included in the order confirmation for such product) (the “Product Warranty”).
    2. Notwithstanding the foregoing, (i) if a product is bare die or bare die on substrate (meaning unprotected device), the Product Warranty shall be limited to thirty (30) days after the date of shipment of such product, and (ii) if a product is designated as ‘Prototype or Feasibility’ on the quote provided by Seller, then the Product Warranty shall not apply to such product in any respect, such product is conveyed “AS-IS” and with no warranty of any kind, express or implied, and such product is not returnable.
    3. The Product Warranty extends only to Buyer and does not extend to any persons obtaining the product from Buyer. The Product Warranty does not apply where the products have (i) been subject to abuse, misuse, negligence, accidents, improper installation, improper handling, improper storage, abnormal environmental conditions, tampering, or use contrary to any instructions or specifications issued by Seller, including without limitation misuse resulting in electrostatic discharge, or (ii) been improperly energized, reconstructed, repaired or altered by anyone other than by Seller’s authorized personnel and agents.
    4. THE WARRANTIES SET FORTH HEREIN OR IN SELLER’S WARRANTY DOCUMENTS WITH RESPECT TO A PRODUCT ARE THE ONLY WARRANTIES MADE BY SELLER IN CONNECTION WITH THE PRODUCTS AND THE TRANSACTIONS CONTEMPLATED AS A RESULT OF THIS SALE. SELLER MAKES NO OTHER WARRANTIES OR REPRESENTATIONS TO BUYER OR ANY OTHER PERSON OF ANY KIND, WHETHER EXPRESS OR IMPLIED, WITH RESPECT TO THE PRODUCTS, AND SELLER SPECIFICALLY DISCLAIMS ALL IMPLIED WARRANTIES INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NON-INFRINGEMENT. Seller shall have no other obligation or liability of any kind and it is further agreed and understood that the price stated for the goods sold is consideration for the limitation of Seller’s liability hereunder.
    5. All warranty claims shall be in accordance with the terms set forth in this Section 11. Buyer must notify Seller of all breaches of the Product Warranty. In order to make a warranty claim, Buyer shall notify Seller of the warranty claim. Seller will valuate the warranty claim request and if it determines that warranty coverage is appropriate, Seller will issue a return authorization to Buyer. Upon receipt of the return authorization, Buyer may return the defective product to Seller, at Seller’s cost and to the location designated by Seller in the return authorization. Upon receipt of the returned product, if Seller determines that the product does not conform to the Product Warranty, Seller, in its sole and absolute discretion, will either (i) repair the product, or (ii) replace the product.
12. Limitations of Liability.
    1. IN NO EVENT SHALL SELLER BE LIABLE FOR INCIDENTAL, SPECIAL, CONSEQUENTIAL, INDIRECT, OR PUNITIVE DAMAGES, INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, LOSS OF USE, LOSS OF TIME, INCONVENIENCE, LOST BUSINESS OPPORTUNITIES, OR DAMAGE TO GOODWILL OR REPUTATION RESULTING OUT OF, OR AS A RESULT OF, THE SALE, DELIVERY, SERVICING, USE OR LOSS OF THE PRODUCTS SOLD HEREUNDER SELLER’S PERFORMANCE OR Rev. 3 4 FAILURE TO PERFORM PURSUANT TO ANY CONTRACT FOR THE SALE OF ANY PRODUCTS, OR THE FURNISHING, PERFORMANCE OR USE OF ANY PRODUCT SOLD PURSUANT HERETO, WHETHER DUE TO A BREACH OF CONTRACT, BREACH OF WARRANTY, TORT, NEGLIGENCE OF SELLER, STRICT LIABILITY OR OTHERWISE, AND EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES OR SUCH DAMAGES COULD HAVE EEN REASONABLY FORESEEN. THE MAXIMUM LIABILITY, IF ANY, OF SELLER FOR ALL DIRECT DAMAGES TO ANYONE, IN CONTRACT OR IN TORT, IS LIMITED TO THE PURCHASE PRICE OF THE PRODUCT PAID BY BUYER. THE RIGHT TO RECOVER DAMAGES WITHIN THE LIMITATION SPECIFIED IS BUYER’S EXCLUSIVE REMEDY.
    2. IN NO EVENT SHALL SELLER BE LIABLE FOR DELAY, FAILURE IN PERFORMANCE, LOSS OR DAMAGE DUE TO ANY FORCE MAJEURE CONDITION INCLUDING, BUT NOT LIMITED TO, FIRE, STRIKE, EMBARGO, EXPLOSION, POWER BLACK OUT, EARTHQUAKE, VOLCANIC ACTION, FLOOD, WAR, WATER, THE ELEMENTS, LABOR DISPUTES, CIVIL OR MILITARY AUTHORITY, ACTS OF GOD, PUBLIC ENEMY, INABILITY TO SECURE RAW MATERIALS, INABILITY TO SECURE PRODUCTS, INABILITY TO SECURE FUEL, TRANSPORTATION FACILITIES, ACTS OR OMISSIONS OF CARRIERS, OR OTHER CAUSES BEYOND SELLER’S REASONABLE CONTROL. SELLER MAY ALLOCATE AVAILABLE PRODUCTS AMONG ITS BUYERS ON ANY REASONABLE AND EQUITABLE BASIS.
    3. IN NO EVENT SHALL SELLER BE LIABLE FOR ANY DELAY, LOSS, DAMAGE OR PRODUCT FAILURE ATTRIBUTABLE TO ANY SERVICE, PRODUCT OR ACTIONS OF
       ANY PERSON OTHER THAN SELLER, ITS EMPLOYEES AND DULY AUTHORIZED AGENTS. SELLER SHALL NOT BE LIABLE FOR AND BUYER SHALL INDEMNIFY,
       DEFEND AND HOLD SELLER HARMLESS FROM ANY CLAIMS BASED ON BUYER’S SPECIFICATIONS OR INSTRUCTIONS OR MODIFICATION OF ANY PRODUCTS BY PARTIES OTHER THAN SELLER, OR USE IN COMBINATION WITH OTHER PRODUCTS.
13. U.S. Export Controls; Federal Contract Information and Controlled Unclassified Information.
    1. Products manufactured and/or sold by Seller are of U.S. origin. As such, Buyer acknowledges that the products are subject to regulation by United States government agencies, which prohibit the export or diversion of the products, information about the products, and derivatives of the products to certain countries and certain persons. Buyer further acknowledges that the U.S. export control laws prohibit the use of the products or derivatives of the products in the design, development or  production of nuclear, chemical or biological weapons or missile delivery systems. Buyer represents, warrants and agrees that Buyer shall abide by, be bound by, and strictly comply with all U.S. export control laws as currently in effect and promulgated from time to time hereafter, including, but not limited to, the provisions of the Export Administration Act of 1979, 50 U.S.C. Appx. §§ 2401 et seq., the Trading with the Enemy Act, 50 U.S.C. § 1 et seq., the Arms Export Control Act, 22 U.S.C. §§ 2778(a) and 2794(7), and the International Emergency Economic Powers Act, 50 U.S.C. § 1701 et seq., and all regulations promulgated from time to time thereunder (collectively, the “U.S. Export Control Laws”), in connection with Buyer’s use, transfer, export, reexport or other disposition of the products or derivatives of the products. In addition to and without limiting the generality of the foregoing, Buyer (i) shall complete, execute and deliver to Seller an End User Statement – Export Compliance in the form provided by Buyer, and Buyer represents and warrants that the information included in such End User Statement is complete and accurate in all respects; and (ii) agrees that it shall not and shall not permit any of its affiliates, or any of their respective, officers, directors, employees, members or managers, directly or indirectly, in violation of U.S. Export Control Laws or otherwise without any required U.S. government Rev. 3 5 license, to export, re-export or otherwise provide the products sold under this Agreement (A) to any other person, entity or country to which export or re-export requires a license or other authorization under U.S. Export Control Laws, (B) to any of Buyer’s affiliates, or Buyer’s or such affiliates’ respective officers, directors, employees, members or managers, or customers, that are listed on any U.S. government list of individuals or entities who are or have been sanctioned, prohibited, restricted, denied or debarred in any way under U.S. Export Control Laws from engaging in exporting, importing or other trade activities or with whom U.S. individuals or entities are prohibited, restricted, denied, or debarred in any with as a result of such U.S. government listing (herein, collectively, “Designated Persons and Entities”), or (C) for any end-use prohibited or restricted in any way under U.S. laws. Buyer cknowledges that the list of embargoed countries and Designated Persons and Entities may be changed from time-to-time without notice, and Buyer shall be responsible for staying informed of any such changes. All sales of the products by Seller that require Seller to export from the U.S. are expressly conditioned upon Seller obtaining any and all necessary U.S. Government licenses and/or approvals required in order to legally export the products. Seller shall have no liability to Buyer or any other party on account of Seller’s inability or failure to obtain any such licenses and/or approvals.
    2. Buyer shall comply with the requirements of all U.S. laws and regulations that are applicable to any information provided by Seller that qualifies as Federal Contract Information (“FCI”) and/or Controlled Unclassified Information (“CUI”), as such terms are defined in such laws and  regulations. Such applicable laws and regulations (collectively, “FCI/CUI Laws”) are incorporated herein by this reference and include, without limitation, FAR 52.204-21 (Basic Safeguarding of Covered Contractor Information Systems), DFARS 252.204-7012 (Safeguarding Covered Defense Information and Cyber Incident Reporting), and DFARS 252.204-7020 (NIST SP 800-171 DoD Assessment Requirements). The restrictions imposed by such laws and regulations apply to U.S. Government contractors and suppliers at all tiers that receive, create, process, store, or transmit FCI and/or CUI. Such restrictions include, without limitation, restrictions on communication channels and information systems used in the receipt, creation, processing, storage, transmission, and destruction of FCI and CUI. The foregoing obligations are in addition to, and do not supersede, Buyer’s obligations under Section 13(a).
    3. Seller reserves the right to immediately terminate transactions with Buyer (without liability of any kind) if, in the opinion of Seller, any action taken or to be taken by Buyer (i) may constitute a violation of the U.S. Export Control Laws or the FCI/CUI Laws, or (ii) may subject Seller or any affiliated company of Seller to legal liability or loss of benefits under any of such laws.
    4. Buyer shall indemnify, defend and hold harmless Seller and its affiliates from and against any and all damages, liabilities, penalties, fines, costs, and expenses, including attorneys’ fees, arising out of claims, suit, allegations or charges of Buyer’s failure to comply with the provisions of
       this Section 13.
14. Applicable Law. This Agreement shall be governed by the laws of the State of Delaware, excluding the conflict of laws principals of that or any other jurisdiction. Application of the U.N. Convention on the International Sale of Goods is expressly disclaimed.
15. Dispute Resolution. Any dispute, controversy, or claim arising out of or related in any way to this Agreement or any sale and purchase of products hereunder or any transaction contemplated hereby which cannot be amicably resolved by the parties shall be submitted to binding arbitration, governed by the Rules of Commercial Arbitration of the American Arbitration Association. The arbitration proceeding shall take place in Manchester, New Hampshire or such other location as the parties may mutually agree. The award of the arbitrators shall be final and binding upon the parties hereto, and judgment upon any award rendered therein may be entered and enforced in any court of competent Rev. 3 6 jurisdiction. Neither this arbitration provision nor a pending arbitration shall prevent a party from obtaining injunctive relief for any matter at any time.
16. Miscellaneous.
    1. Assignment. This Agreement may not be assigned by Buyer without Seller’s prior, written consent. Seller may, without Buyer’s consent, assign this Agreement.
    2. Modification. Any modification or waiver of any provision of these terms and conditions must be made in writing and be signed by authorized representatives of both Parties.
    3. Severability. If any term or provision of these terms and conditions shall be held invalid or unenforceable, the remainder of such terms and conditions shall not be affected thereby and each term and condition hereof shall be valid and enforceable to the fullest extent permitted by law.
    4. Waiver. A waiver by either of the Parties of any breach of these terms and conditions by the other party in a particular instance shall not operate as a waiver of subsequent breaches of the same or different kind. The failure of either of the Parties to exercise any rights under these terms and conditions in a particular instance shall not operate as a waiver of the party’s right to exercise the same or different rights in subsequent instances.
    5. Entire Agreement. This Agreement constitutes the entire understanding of the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous written or oral agreements, conditions, understandings or representations, including without limitation any terms that might be contained in any purchase order or other document received from Buyer or submitted to Seller.
    6. Succession. These terms and conditions shall be binding upon and shall inure to the benefit of Seller and Buyer and their respective heirs, successors and permitted assigns.
    7. Notices. All notices provided for by these terms and conditions shall be given in writing and addressed to the other party at its address or email address set forth in the applicable order confirmation (or to such other address or email address that the receiving party may designate from time to time in accordance with this Section). All notices must be delivered either (i) by actual delivery, (ii) by registered or certified mail, return receipt requested, or (iii) by electronic mail (if to Seller, such electronic mail shall be sent to sales@gp-ir.com. Such notice shall be deemed to be received on the date when (i) personally delivered, (ii) deposited in the mail (registered or certified mail, return receipt requested), or (iii) transmitted by electronic mail to the intended recipient on a business day prior to 5:00 P.M. local time, otherwise on the next business day.