General Terms and Conditions of Sale

1. DEFINITIONS

Buyer means the person(s), firm, company or corporation who purchases the Product and/or Services from the Seller.

Carrier means the agent or the carrier designated by the Buyer, or if none, the agent or the carrier chosen by the Seller on the Buyer’s behalf who will accept delivery of the Products on behalf of the Buyer and transport the same to the Buyer.

Change Order means any change to the Contract that has been approved in writing by the Buyer and Seller.

Contract means any contract between the Seller and the Buyer for the supply of Products or Services, resulting from the Buyer’s request or order placed by the Buyer, on these terms and conditions and the terms on the face of the document under which it is accepted by the Seller.

Product means any products, components, goods or materials agreed in the Contract to be supplied to the Buyer by the Seller (including any part or parts of them).

Seller means Blackphone SA unless otherwise stated.

Services means any services (including without limitation any maintenance, repair and overhaul services) agreed in the Contract to be provided to the Buyer by the Seller (including any part or parts of them).

2. BASIS OF ORDER AND ACKNOWLEDGEMENT

2.1 The Contract is subject to these terms and conditions to the exclusion of all other terms and conditions (including any terms and conditions Buyer purports to apply in any Contract).

2.2 A Contract shall not be effective until the Seller has issued written acknowledgment and acceptance of such Contract (notwithstanding any earlier confirmation of receipt). The Seller may in its sole discretion decline any purchase order placed by the Buyer.

2.3 The Buyer shall ensure that the terms of its purchase order or request are complete and accurate.

2.4 No change or modification of Contracts issued shall be allowed after acceptance by the Seller unless authorized by a Change Order delivered by the Buyer and accepted in writing by the Seller.

3. DESCRIPTION AND SPECIFICATION OF THE GOODS AND SERVICES

3.1 The description, part numbers and/or specification of the Product and/or Services shall be set out in the Seller’s quotation or the Seller’s acceptance of the Contract. All drawings, descriptions, weights, dimensions, etc. and advertising issued by the Seller are issued to provide an approximate idea of the Product or Services described in them and do not form part of the Contract unless expressly stated in the Contract.

3.2 The Buyer alone shall determine the suitability of the Products for Buyer’s use and/or application.

4. DELIVERY AND ACCEPTANCE

4.1 Unless otherwise stated on the Contract, all Products are sold EXW Seller’s Hong Kong Warehouse (incoterms 2010). Delivery will take place when the Product is made available to the Carrier at Seller’s facility.

4.2 Unless a specific delivery date has been guaranteed by the Seller, all delivery dates are estimates only and time is not of the essence. The Seller will not be liable for any loss (including loss of profit), costs, damages, charges or expenses caused directly or indirectly by any delay in the delivery of the Product. The Buyer may terminate or rescind the Contract only if the delay has substantially exceeded the initially estimated delivery period and the Seller is unable to specify a firm delivery date that is reasonably acceptable to the Buyer under the circumstances.

4.3 If for any reason the Buyer does not take delivery, or the Seller is unable to deliver the Product on time due to an act or omission of the Buyer, then such Product will be deemed to have been delivered and risk shall pass to the Buyer. The Seller may at its option:

(a) store the Product until actual delivery whereupon the Buyer will be liable for all related costs and expenses (including without limitation storage and insurance); or

(b) sell such Product at the best price readily obtainable (after providing not less than thirty (30) days prior written notice to Buyer). Seller may charge the Buyer for any shortfall below the Contract price or account to the Buyer for any excess (after deducting all reasonable survey, repair, storage and selling expenses).

4.4 The Buyer may arrange for a visual inspection of the Product prior to shipment at the Seller’s facility. If the Buyer conducts such an inspection, the Seller shall not be liable for any claim made after shipment in respect to any defect in the Product which would have been apparent upon such inspection.

4.5 The Seller may, at its option, make partial shipments of Product and invoice the Buyer for each shipment individually in which case each delivery shall constitute a separate contract. Failure by the Seller to deliver any one or more of the shipments in accordance with these terms and conditions or any claim by the Buyer in respect of any one or more shipments shall not entitle the Buyer to repudiate the whole Contract or refuse to accept subsequent shipments. The Buyer shall accept any early delivery.

4.6 The Buyer will be deemed to have accepted the Product as being in accordance with the Contract, the Seller shall have no liability for any defect or failure unless within 15 days of the date of delivery of the Product, the Buyer notifies the Seller in writing of any defect apparent upon inspection of the Product to conform with the Contract.

5. PASSING OF RISK AND TITLE

5.1 The risk in Products shall pass to the Buyer on delivery.

5.2 Full legal, beneficial and equitable title to the Products shall remain vested in the Seller (even though they have been delivered and risk has passed to the Buyer) until payment in full, in cash or cleared funds, for all the Products has been received by the Seller.

5.3 Until full legal, beneficial and equitable title to and property in the Products passes to the Buyer:

(a) while the Products are in the custody of the Buyer, Buyer has to bear all the risks in the Products, for any reason whatsoever, even in cases of force majeure, acts of God or acts of third parties. The Buyer must store the Products at its premises and insure them, at no cost to the Seller, and keep them clearly identifiable as belonging to the Seller; (b) the Seller may, on demand and without prior notice, repossess and resell the Products if any of the events specified in Section 12.3 occurs or if any sum due to the Seller from the Buyer is not paid when due and for this purpose, the Seller, its employees, agents and sub-contractors will be entitled to unrestricted access to any premises where any of the Products are situated.

5.4 The Seller hereby authorises the Buyer to use and/or sell the Products in the normal course of the Buyer’s business and to pass good title in the Products to its purchasers, if they are purchasers in good faith without notice of the Seller’s rights. This right shall automatically cease on the occurrence of any event set out in Section 12.3 and/or if any sum owed to the Seller by the Buyer is not paid when due. If the Buyer sells the Products or Services prior to paying the full price thereof the Buyer shall hold the proceeds of sale on trust for the Seller.

5.5 The Seller’s rights and remedies set forth herein are in addition to and shall not in any way prejudice, limit or restrict any of the Seller’s other rights or remedies under the Contract or in law or equity.

6. CONTRACT PRICE

6.1 The price charged in respect of Product or Services supplied shall be the price that is current at the date of delivery. The Seller reserves the right to adjust prices where necessary before a Contract is accepted notwithstanding the prices stated in any price list or quotation. The Seller shall not normally perform Services until the Buyer has confirmed its agreement to the estimated price.

6.2 The Seller reserves the right, by giving notice to the Buyer at any time before delivery, to increase the price of the Product or Services to reflect any increase in the cost to the Seller which is due to any factor beyond the Seller’s control (such as, without limitation, any increase in the costs of labour, materials, or other costs of manufacture or supply); any change in the quantities of the Product requested by the Buyer; any change in the delivery dates of the Product or Services requested by the Buyer; or any delay or cost caused by any instructions of the Buyer or failure of the Buyer to give the Seller adequate information or instructions.

6.3 Unless otherwise agreed in writing, the price for the Product or Services shall be exclusive of any taxes (including sales tax) or levies and the Buyer will pay all costs and charges in relation to packaging (other than standard packaging), loading, unloading, carriage, freight and insurance, where appropriate.

7. PAYMENT TERMS

7.1 Unless otherwise stated, payment for the Products and/or Services is due 30 days after the date of the Seller’s invoice. The Seller may issue a separate invoice for each Contract or for each shipment (if more than one) under a Contract. The Buyer shall pay the amount stated in the Seller’s invoice in the currency required by the invoice in immediately available funds, without any deduction whether by way of set-off, withholding, counterclaim, discount, abatement or otherwise. Payment must be made to the Seller at the address or account stated on the invoice. Time for payment is of the essence.

7.2 In the event that there is a deterioration in the financial capacity of the Buyer, the Seller reserves the right to revise payment terms at any time and to request guarantees, security, stage payments or cash in advance for the Products and/or Services. The Seller may, at its discretion, refuse or limit deferred payment terms to the Buyer.

7.3 The Seller may agree to accept payment for the Products and/or Services by credit card provided that the Buyer shall in addition to the price of the Products or Services pay any charge levied by the credit card company in respect of such transaction.

7.4 Notwithstanding any other provision, all payments payable to the Seller under the Contract shall become due immediately upon termination of the Contract for whatever reason.

7.5 If any sum due from the Buyer to the Seller is not paid to the Seller by the due date for payment, the Seller shall be entitled to:

(a) cancel or suspend performance of the Contract or any other contract or order placed with the Seller or any affiliate including suspending deliveries of the Product, Services or any other goods until arrangements as to payment or credit have been established which are satisfactory to the Seller; and/or

(b) require the Buyer to pay for Products or Services prior to shipment from the Seller’s place of business; and/or

(c) charge the Buyer interest calculated on a daily basis on all overdue amounts (both before and after judgment) until actual payment at the rate of eight per cent (8%) per annum above the London Interbank Offered Rate (LIBOR) prevailing from time to time (or such other rate which is legally permissible) until payment is made in full.

8. WARRANTY

8.1 The Seller warrants that the Products furnished hereunder shall, at the time of delivery, be free from defects in material and workmanship. Services shall be performed with reasonable skill and care. Product will be repaired or replaced, at the Seller’s option, or Services re- performed, without charge, and re-warranted for the remainder of the original warranty period.

8.2 The Seller shall not be liable under the warranty in any of the following circumstances: (i) Products or parts thereof which have been modified, altered, installed, used or serviced other than in conformity with Seller’s applicable specifications, manuals, bulletins or instructions, or which shall have been subjected to improper installation, misuse or neglect; (ii) Products that have not been maintained and operated in accordance with the Seller’s instructions; (iii) normal wear and tear, willful or accidental damage, harsh environment, experimental running; (iv) Products or parts thereof furnished by Buyer or acquired from others at Buyer’s request and/or to Buyer’s specifications, and use of components not manufactured by or authorized by the Seller in the Products; (v) Products which are expendable in nature; (vi) the price for Products or Services, or any other goods or services supplied by the Seller or its affiliates, has not been received in full.

8.3 Further details on the warranty conditions can be found in the safety and warranty guide supplied with the Products as well as at: Silent-Circle-Return-Guidelines-v2.0

8.5 THERE ARE NO OTHER WARRANTIES, CONDITIONS OR TERMS, EXPRESS OR IMPLIED, INCLUDING WARRANTIES OF MERCHANTABILITY OR SATISFACTORY QUALITY OR FITNESS FOR A PARTICULAR PURPOSE.

9. EXCLUSION AND LIMITATION OF LIABILITY

9.1 These terms and conditions set out the entire liability of the Seller in respect of Products or Services supplied by the Seller and any representation, statement or tortious act or omission including negligence arising under or in connection with the Contract.

9.2 Nothing in these terms and conditions shall exclude or limit the Seller’s liability for (i) death or personal injury caused by the Seller; or (ii) for fraudulent misrepresentation; or (iii) for any liability caused by the Seller’s gross negligence or wilful conduct; or (iv) if and to the extent it cannot legally be excluded or limited. Any limitation or exclusion of liability shall apply to the extent permitted under applicable law.

9.3 THE SELLER SHALL NOT BE LIABLE FOR: (1) ANY LOSS OF ANTICIPATED PROFITS, (2) ANY LOSS OF ACTUAL PROFITS, (DIRECT OR INDIRECT), (3) ANY LOSS OF ANTICIPATED SAVINGS, (4) ANY LOSS OF BUSINESS, (5) ANY ECONOMIC LOSS OF WHATEVER NATURE, (6) ANY INDIRECT, SPECIAL OR CONSEQUENTIAL LOSS OR DAMAGE HOWSOEVER CAUSED, AND/OR (7) ANY LOSS ARISNG AS A RESULT OF ANY THIRD PARTY BRINGING A CLAIM OF ANY NATURE WHATSOEVER. THE SELLER SHALL NOT BE LIABLE FOR ANY SUCH LOSS WHETHER OR NOT ANY SUCH LOSS OR DAMAGE WAS FORESEEN, DIRECT, FORSEEABLE, KNOWN OR OTHERWISE.

9.4 SUBJECT TO SECTION 9.2 ABOVE, THE TOTAL AGGREGATE LIABILITY OF THE SELLER ARISING OUT OF OR IN CONNECTION WITH THE PERFORMANCE OR CONTEMPLATED PERFORMANCE OF THE CONTRACT WHETHER FOR NEGLIGENCE OR BREACH OF CONTRACT OR ANY CAUSE WHATSOEVER SHALL IN NO EVENT EXCEED THE PRICE PAID BY THE BUYER FOR THE PRODUCT OR SERVICES GIVING RISE TO THE BUYER’S CLAIM.

10. SUBCONTRACTING, ASSIGNMENT AND THIRD PARTY RIGHTS

10.1 The Buyer shall not be entitled to assign, charge, subcontract or transfer the Contract or any part of it without the prior written consent of the Seller.

10.2 The Seller may assign, charge, subcontract or transfer the Contract or any part of it to any person, including its affiliate companies, without the consent of the Buyer.

10.3 Other than affiliates of the Seller, a person who is not a party to the Contract (including without limitation any employee, officer, agent, representative or sub- contractor of either party) shall not have any right to enforce any term of the Contract which expressly or by implication confers a benefit on that person without the express prior agreement in writing of the Seller and the Buyer.

10.4 Without prejudice to the intention of the parties to give no rights to the third parties under the Contract, any term of the Contract can be varied and the Contract can be cancelled or terminated without the consent of any third party who might benefit from its terms or have enforceable rights under the Contract.

11. FORCE MAJEURE

The Seller shall not be held liable for delay or failure in shipment or delivery of the Products or Services due to any cause beyond the reasonable control of the Seller, including, without limitation, war, fire, flood, strikes or other labour disturbance, accidents, natural disasters, Act of God, governmental order or requirement, interruption, obsolescence or shortage of materials, transportation facilities or energy supply, or events beyond the reasonable control of its suppliers or subcontractors and the Seller shall be excused from deliveries to the extent that deliveries may be prevented or delayed by any of the foregoing events. During any such event as listed above, the Seller will endeavour in good faith to allocate deliveries fairly among its buyers but expressly reserves in its discretion, without liability to the Buyer, the final determination of deliveries to be made. If said event as listed above continues for a continuous periodin excess of ninety (90) days the Seller may terminate the Contract without liability by sending a registered letter with return receipt to the Buyer.

12. CONTRACT CANCELLATION, BREACH OF CONTRACT AND INSOLVENCY

12.1 The Buyer may only cancel a Contract (or any part of a Contract) which the Seller has already accepted, with the Seller’s prior agreement in writing and provided the Buyer indemnifies the Seller in full in terms established by the Seller. Cancellation charges may apply to such cancellation including but not limited to: (i) all amounts due under the Contract in respect of work performed and/or Products delivered up to the date of cancellation; (ii) any sums which have been paid by the Seller or become payable as a result of the cancellation to its subcontractors and supply chain to procure all or any part of the Products or Services for the Buyer’s requirements including all applicable overhead and profit; (iii) the cost of any work, materials and tooling incurred by the Seller, including initial costs, overhead, profit and preparatory expenses allocable thereto, used exclusively by the Seller to supply the Products and Services; (iv) any non-recurring engineering and project investment costs not paid by the Buyer or recovered by the Seller under the Contract; (v) the costs of settling and paying any losses, damages or claims arising out of the termination of work and (vi) reimbursing any other reasonable and proper sums suffered or incurred by the Seller solely in connection with or resulting from the cancellation of the Contract including without limitation overhead and the profit the Seller would have earned under the Contract.

12.2 The Buyer shall pay the Seller all cancellation charges within thirty (30) days of the date of Seller’s demand.

12.3 In the event (a) the Buyer commits a breach of any of its obligations under the Contract and fails to remedy such breach within a period of 14 days; or (b) the Buyer fails to make payment under the Contract when due, or suspends payments or is unable to pay its debts as they fall due; or (c) the institution of any proceedings by or against the Buyer, voluntary or involuntary, in bankruptcy or insolvency or for the appointment of an administrator, administrative receiver, receiver or trustee or an assignee for the benefit of creditors of the business or property of the Buyer; or (d) the Buyer suffers or undergoes an analogous procedure in the country in which the Buyer is established; or (e) the Buyer ceases, or threatens to cease, to carry on business; or (f) the Seller reasonably believes that any of the above events is about to occur in relation to the Buyer, then the Seller shall be entitled to cancel this Contract forthwith by written notice without prejudice to any rights arising prior to said cancellation. The Buyer shall pay cancellation charges as set out in this section.

13. EXPORT AND GOVERNMENTAL COMPLIANCE

13.1 Each party agrees to comply with all applicable governmental regulations as they relate to the import, export and re-export of information and/or Products and/or Buyer or Seller Property. Without limiting the foregoing, neither the Buyer nor the Seller shall disclose or deliver any information or Products and/or Buyer or Seller Property provided hereunder in any manner contrary to any applicable export or import laws and regulations. The Buyer and the Seller acknowledge that these laws and regulations impose restrictions on import, export and transfer to third countries of certain categories of information and products, and that authorisations/licenses from the applicable regulatory agency may be required before such information and Products and/or Buyer or Seller property can be disclosed or delivered hereunder, and that such authorisations/licences may impose further restrictions on use and further disclosure or delivery of such information and Products and/or Buyer or Seller Property.

13.2 The Seller shall not be liable for delays or refusals by governmental authorities or other authorities to grant licences or approvals, nor for suspension or revocation thereof, nor for changes in export classification.

14. NOTICES

Unless otherwise provided by law, any notice to be given under the Contract shall be sufficient if it is in writing, for the attention of the President and chief executive officer of the other party, or otherwise as directed by each party from time to time, and delivered personally, or via registered or certified mail. Notice shall be deemed sent and received on the date of actual receipt at the other party’s principal place of business.

15. INTELLECTUAL PROPERTY RIGHTS

15.1 Any intellectual property rights (including, without limitation, patents, registered and unregistered designs, trademarks and service marks (registered or not) and copyright and any applications for them) in the Products or Services or in any designs, drawings, or production data owned or created by the Seller in the course of the performance of the Contract or the provision of the Services shall remain the Seller’s property unless otherwise expressly agreed by the Seller. The Seller grants, on full payment for the Products or Services the non-exclusive right for the Buyer and bona fide purchasers from the Buyer to use, for the operation of the Products or Services for their intended purpose only, (a) any software supplied with, or embedded in, the Products and Services, and (b) technical manuals and instructions relating to operation and maintenance of the Products and Services.

15.2 The license terms for Buyer’s use of Seller’s software shall be as stated in the Blackphone Software Terms and Conditions unless otherwise agreed in the Contract.

16. CONFIDENTIALITY

16.1 The parties shall each keep confidential and shall not, without the prior written consent of the other, disclose to any third party or otherwise make public the terms or existence of the Contract or any other confidential or sensitive information of the other.

16.2 The Buyer agrees that it will not exhibit the Seller’s Product, advertisements or price lists relating to any of the Seller’s Product or Services without the prior written consent of the Seller.

17. MISCELLANEOUS PROVISIONS

17.1 Nothing in the Contract shall create, or be deemed to create a partnership or joint venture or relationship of employer and employee or principal and agent between the parties.

17.2 The rights and remedies of the Seller in respect of the Contract shall not be diminished, waived or extinguished by the granting of any indulgence, forbearance or extension of time granted by the Seller nor by any failure of or delay by the Seller in ascertaining or exercising any such rights or remedies. The waiver by the Seller of any breach of the Contract shall not prevent the subsequent enforcement of the Contract and shall not be deemed to be a waiver of any subsequent breach of that or any other terms and conditions.

17.3 If at any time any one or more of the terms of the Contract or any part of one or more of these terms and conditions is held to be or becomes void or otherwise unenforceable for any reason under any applicable law, the same shall be deemed omitted from the Contract and the validity and/or enforceability of the remaining terms and conditions of the Contract shall not in any way be affected or impaired as a result of that omission.

17.4 The Contract sets out the entire agreement and understanding between the Buyer and the Seller in connection with the sale of the Product or Services and shall supersede and replace all documentation previously issued by the Seller or the Buyer. In case of conflict, agreed terms appearing on the face of the Contract shall take precedence over these terms and conditions, and these terms and conditions take precedence over any other documents referred to in the Contract.

17.5 Headings are for reference only and shall not affect the interpretation of these terms and conditions.

17.6 Blackphone may make changes to this Agreement from time to time. Blackphone will publish the changes https://silentcircle.com/terms-and-conditions/ . The changes will be effective when published, provided that any changes to the dispute resolution provision will not apply to any dispute that a party has provided written notice of prior to the date of the change in the terms.

18. LAW AND JURISDICTION

For Buyers residing in the United States and its territories:

Buyer agrees that all disputes, claims or controversies relating to the Contract, will be governed by the laws of the United States and by the laws of the State of Delaware without regard to its conflicts of laws provisions. Buyer agrees to the personal jurisdiction of the courts in New Castle County, Delaware, and waives any objection to such jurisdiction.

For all other Buyers:

Buyer agrees that all disputes, claims or controversies relating to the Contract, will be governed by the laws of Switzerland without regard to its conflicts of laws provisions. Buyer agrees to the personal jurisdiction of the courts in Geneva and waives any objection to such jurisdiction.

The preceding provision regarding venue does not apply if Buyer is a consumer based in the European Union. In such cases, Buyer may bring a claim in the courts of England and Wales.

The Parties agree that the United Nations Convention on the International Sale of Goods is specifically excluded from applying to the Contract.

Any claim under the Contract must be brought within one (1) year after the cause of action arises.

Version Date: 1st February 2016