1. ACCEPTANCE. This Purchase Order constitutes Buyer’s offer to Seller and becomes a binding contract on the terms set forth herein when it is accepted by Seller, either by acknowledgment or by the commencement of performance hereunder. No revisions to this Order shall be valid unless in writing and signed by an authorized representative of Buyer: and no conditions stated by Seller in accepting or acknowledging this Order shall be binding upon Buyer if in conflict with, inconsistent with, or in addition to the terms and conditions contained herein, unless expressly accepted in writing by Buyer. All such previous communications are herby abrogated and withdrawn and no stipulations, representations or agreements by Buyer or any of its officers, agents or employees shall be binding on the Buyer unless reduced to writing and attached to and incorporated in this Purchase Order by the Buyer unless reduced to writing and attached to and incorporated in this Purchase Order by reference as above provided and no local, general or trade custom shall alter or vary the terms hereof.
2. REPRODUCTION RIGHTS AND CONFIDENTIALITY. Buyer does not grant or convey to Seller by virtue of this Order (a) any reproduction rights in or to the articles called for hereunder or (b) any right to use designs, drawings or other information belonging to Buyer or supplied by or on behalf of Buyer for use in the performance of this Order for the production, manufacture, or design of any articles or materials for anyone other than Buyer. Except as otherwise declared herein, the Seller shall not disclose any details connected with this Order to any third party, except to the extent required to insure Seller’s performance and such disclosure is in the Buyer’s interest without first obtaining the written consent of the Buyer.
3. DRAWING APPROVAL. Items requiring Buyer’s approval of drawings shall not be manufactured without such approval. Any expense incurred by Buyer through Seller’s failure to comply herewith shall be charged to Seller’s account.
4. DESIGN CHANGES. Buyer may at any time make changes in the applicable drawings, design or specification and adjustment of price resulting from such changes shall be made in proportion to the increase or decrease of cost to the Seller.
5. MANUFACTURE, DELIVERY, PACKING AND FREIGHT. Seller shall not manufacture in advance of the time necessary to meet Buyer’s specified requirements. Delivery shall not be made to any place other than the destination specified, without Buyer’s written approval. No charge will be allowed for packing or freight unless agreed upon in writing prior to acceptance of this Order. Material shall be packed in conformity with tariff or classification requirements so as to secure the lowest possible freight rates while safeguarding against damages from weather transportation, or storage. Buyer shall receive the benefit of any decrease in freight rates between time of quotation and date of shipment in all cases where freight is part of the quoted price. Seller shall not make partial shipments or deviate from the shipping and routing instructions and schedule herein without prior authorization from Buyer. Seller agrees to reimburse Buyer for any additional expenses incurred from Seller’s breach hereof.
6. GENERAL WARRANTY. Seller warrants that all of the articles and all of the materials furnished under this Order are free and clear of all liens and encumbrances whatsoever and that Seller has a good and marketable title to same and Seller agrees to hold Buyer harmless against any and all claimants to said merchandise. Seller further warrants that all of the articles and all of the materials furnished under this Order will be free from defects in materials, workmanship and if Seller’s design, will conform to applicable specifications, drawings, samples or other descriptions given, and shall be fit and sufficient for the purpose specified of good material and workmanship, and free from defect. This express warranty shall remain in effect as to each material and each article for a period of twelve (12) months after it is applied to a use for which it was designed. The foregoing period and time may be modified by written agreement or any contract made a part of this Purchase Order.
The aforesaid express warranty shall be in addition to any other warranties, express, implied or statutory, or any standard warranty or service guarantee given to Buyer by Seller. All warranties shall be construed as conditions as well as warranties and shall not be deemed to be exclusive. All warranties and service guarantees shall run both to Buyer and to its customers. Seller will defend and indemnify Buyer against all claims for damages to person or property resulting from defects in material or workmanship, or from failure of Seller to comply with safety inspection and labeling requirements of governmental agencies in force as applicable when goods are delivered to Buyer. THERE SHALL BE NO EXCLUSIONS, LIMITATIONS OR DISCLAIMERS OF THESE WARRANTIES.
Notice of any breach of warranty shall be deemed sufficient if given by Buyer within ninety (90) after the discovery thereof by Buyer. Said notice shall be given in writing, and need only inform Seller that the goods or services are defective, non conforming, troublesome, or in need repair or corrective action. The notice need not include a clear statement of all objections that will be relied upon by Buyer as the basis of breach.
7. INSPECTION AND REJECTIONS. All materials and work under this Order are subject to inspection by Buyer or its agents. The Seller hereby grants Buyer free access to the site of the materials or work, at all reasonable times. Inspection by Buyer shall not relieve the Seller of any responsibility under this Order. If within a reasonable time after delivery, which period of time shall be no less that ten (10) business days, Buyer finds goods ordered hereunder to be defective in workmanship or materials or otherwise not in conformity herewith, Buyer may at its option return the goods at Seller’s expense, or after due notice and Seller’s failure to implement a timely and effective solution, make such corrections and repairs as may be necessary and back charge the Seller for the full expense. Proper notice of rejection shall be deemed given to Seller by prompt shipment of goods to Seller after inspection of the same by Buyer, or written notice to Seller of intention not to accept the same. Such notice need not include a statement of any objections that will be relied upon by Buyer as a basis for breach. Buyer reserves all rights and remedies for Seller’s breach provided by the California Commercial Code and provided by any other applicable law. Buyer reserves the right to deduct (from the payment other wise required to be made for any accepted part) damages it has suffered for any breach by Seller under this or any other Order from Buyer to Seller.
8. TERMINATION FOR CONVENIENCE. If the merchandise covered by the Order is standard merchandise, Buyer at its option may terminate at any time by written notice any unshipped portion of the Order without further obligation hereunder except to make payment, subject to other applicable terms hereof, for the merchandise actually shipped prior to such termination.
If this Order covers merchandise manufactured or fabricated to the specifications of the Buyer, or special specifications prepared by Seller for Buyer, Buyer may terminate such work under this Purchase Order in whole, or in part, at any time by written notice to Seller. Upon such termination in whole or in part of such work under this Purchase Order, Seller will stop work immediately, notify subcontractors to stop work, and protect property in Seller’s possession in which the Buyer has or may acquire an interest. Seller may claim reimbursement for actual costs incurred up to and including the date of termination, which are properly allocable to or apportionable under generally accepted accounting practices including liabilities to subcontractors, which are so allocable. Seller may claim a reasonable profit on the work actually done by Seller prior to such termination, the rate of which shall not exceed the rate used in establishing the original Purchase Order price. The total of such claims shall not, however, exceed the cancelled commitment value of this Purchase Order. This Section shall neither limit nor apply to Buyer’s right to cancel this Order for cause.
9. TERMINATION FOR CAUSE. If Seller fails to make delivery in accordance with the delivery schedule or otherwise fails to observe or comply with any of the other terms, conditions or warranties set forth in the Order, or fails to make progress so as to give Buyer reason to believe Seller’s performance may be in jeopardy, Buyer may, in addition to any other remedies provided in the Order or by the governing law, cancel the Order as to goods not yet shipped and services not yet rendered, by written notice to Seller, without any liability by Buyer to Seller on account thereof, and may produce, purchase or otherwise acquire substitute goods or services elsewhere on such terms or in such manner as it may deem appropriate in the exercise of commercially reasonable judgment, and Seller shall be liable to Buyer for any excess cost or other expense incurred by Buyer.
10. PATENT PROTECTION. To the extent that the articles or materials delivered hereunder are not manufactured pursuant to designs originated by Buyer, Seller guarantees that the sale and/or use of any or all articles or materials delivered hereunder will not infringe any United States or foreign patents, and agrees that Seller will save Buyer and/or its customers harmless from any loss, damage or liability which may be incurred on account of infringement or alleged infringement of patent rights with respect to such articles or materials, and that it will at its own expense defend any action suit or claim in which such infringement is alleged; provided Seller is duly notified as to suits or claims against Buyer and provided further that Seller’s indemnity as to use shall not apply to infringement arising from use in combination with other items where infringement would not have occurred from the normal use for which the article was designed.
If research, development, design or any related costs are included in the price of the work and materials ordered herein, Buyer and Seller agree that payment for the said work and materials is payment in full for everything of value produced hereunder, specifically including (by way of example and not of limitation) any and all subject matter of patents, copyrights and trademarks which may be included herein or developed here from. Seller shall not be entitled to any additional payment by virtue of the presence of patent, copyright, trademark or other proprietary rights in the work and materials covered by the Order and shall cooperate with Buyer and execute this documents appropriate for securing for Buyer protection of patent, copyright or trademark subject matter and herby authorizes Buyer to execute such documents on its behalf.
Seller shall report to Buyer promptly and in reasonable written detail, each notice or claim of patent, copyright, trademark or trade secret infringement or any other claims arising out of the performance of this Order or the manufacture, use or sales of any supplies furnished or work or services performed hereunder and, in the event of claim or suit against Buyer, shall furnish to Buyer, upon request of Buyer and at Buyer’s expense, all evidence and information in possession of Seller pertaining to such suit or claims.
11. LOSS OR DAMAGE. Seller shall assume and pay any and all loss or damage to said materials and articles from any cause whatsoever until delivered to Buyer at the f.o.b. point specified in this Order. Upon delivery of said merchandise to a common carrier at such f.o.b. point, properly consigned to Buyer, any loss or damage to such merchandise thereafter occurring shall be borne by Buyer, provided said materials and articles were properly handled, packed and noted for shipment.
Buyer shall assume no risk of loss pursuant to this Section in the event that Seller’s performance so fails to conform to the Terms and Conditions of this Order as to give Buyer a right of rejection pursuant to Section 7 of this Order. In the event of Buyer’s revocation of acceptance for whatever reason, title shall be treated as having been vested in Seller from the beginning of Seller’s performance, and risk of loss will be treated as having remained with Seller from the beginning of its performance to the extent of any deficiency in Buyer’s effective insurance coverage.
12. INSURANCE AND INDEMNITY. Seller agrees that Seller will defend, indemnify and hold harmless Buyer and its officers and employees from any loss, cost, damage, expense or liability by reason of property damage or personal injury of whatsoever nature or kind arising from or as a result of Seller’s performance under this Purchase Order, whether arising from actions of Seller or its employees, subcontractors or sub-subcontractors. Seller shall defend any suit and pay any judgment and expenses or effect settlement of any suit or proceeding brought against Buyer and/or its subsidiaries arising from its purchase and/or use of the goods and services covered by this Purchase Order: and Seller shall hold Buyer and its subsidiaries harmless from all liability and litigation expenses based upon alleged infringement of any patent: except for the specific designs or specification of Buyer.
Seller agrees that it and its subcontractors or sub-subcontractors will maintain public liability and property damage insurance in reasonable limits covering the obligations set forth above and elsewhere herein and will maintain proper worker’s compensation insurance covering all employees engaged in the performance of such services and/or delivery and/or installation. Certificates of coverage evidencing such insurance and providing that no expiration, termination, or modification of the insurance coverage shall take place without thirty (30) days’ prior written notice by the insurer to Buyer shall be furnished to Buyer prior to starting any Work on any materials or supply of any labor or services, or on demand for any Order that only relates to standard manufactured goods or raw materials.
13. TOOLS AND MATERIALS. Title to and the right of immediate possession of all tooling, designs, patterns, drawings and materials furnished by Buyer to Seller for use hereunder shall be and remain in Buyer, in all stages of construction. When the cost of dies and tools or negatives and plates involved in the manufacture of production of parts covered by this Order are included in the price per unit, then such dies and tools become the property of the Buyer upon completion of orders. Any dies and tools otherwise paid for by the Buyer shall forthwith become its property. All such tooling, designs, patterns, drawings and materials which are the property of Buyer shall be held at Seller’s risk to be returned to Buyer substantially intact and unencumbered by any adverse interest; and the replacement cost thereof with loss payable to Buyer, Copies of policies or certificates of such insurance shall be furnished to Buyer on demand.
14. DELAYS. The Seller shall notify the Buyer promptly in writing of any delays and of any actual or potential labor dispute, which is delaying, or which threatens to delay the timely performance of the Order.
15. PAYMENT. Payment for material on this Order shall not constitute an acceptance thereof, but all materials shall be received subject to Buyer’s inspection and rejection. Payment shall be made as stated on the Order, less agreed cash discount, unless otherwise specifically arranged for and stated on this Order; or in the event that merchandise has not been received, the Buyer reserves the right to withhold payment until material has been received and checked and does not waive the right to deduct the cash discount. When invoices subject to discount are not mailed on date of shipment, discount period will begin on the date they are received in Buyer’s office. Buyer count will be accepted as final on all shipments not accompanied by packing list.
16. ASSIGNMENT. Seller may not assign this Order or sublet any part of this Order or payments due hereunder without the prior written consent of Buyer, provided that Seller shall supply Buyer promptly with two (2) copies of any such assignment, and provided further that payment to an assignee of any claim under this Order shall be subject to set-offs of any amounts for any present or future claim or claims which Buyer may have against Seller.
17. TIME OF ESSENCE. Time is the essence of this contract and Buyer reserves the right to cancel this Order without penalty if shipments are not made as promised or required.
18. WAIVER. Buyer’s failure to insist, in any one or more instances, upon the performance of any of the terms, covenants or conditions of this Order or to exercise any right hereunder shall not be construed as a waiver or relinquishment of the future performance of such terms, covenants or conditions by the Seller or the future exercise of such right but the obligation of the Seller with respect to such future performance shall continue in full force and effect.
19. COMPLIANCE WITH LAW. The Seller agrees and warrants that the performance of the Order is and will be subject to all applicable Federal, State and Local laws, rules and regulations. The Seller warrants that all goods and equipment furnished under this Order except those specifically manufactured in accordance with drawings and/or specifications furnished by Buyer are in full compliance with the Federal Occupational Health and Safety Act of 1970 as amended.
21. GOVERNING LAW. The contract resulting from the acceptance of the Order shall be interpreted and governed by the laws of the State of California. Buyer reserves all rights and remedies for Seller’s breach provided by said laws of the State of California.
22. VALIDITY. The invalidity in whole or part of any term of condition of this Order shall not affect the validity of the remainder of this Order or any other term or condition therein.
23. ENTIRE AGREEMENT. This Purchase Order expresses the entire agreement between Seller and Buyer hereto superseding any prior understanding, and may be modified only by a written instrument signed by an authorized officer of Buyer and Seller.
24. The Supplier represents and warrants that it will not buy from any company that the Supplier knows or ought reasonably to be aware is directly involved in the manufacture of torture equipment or other equipment that is used in the violation of human rights and or involved in the employment of child labour as defined by Government Instrumentality in the country of manufacture.
Rev.00, 02/27/2006 (Revised 04/20/09)