General Terms and Conditions of Purchase


1 Scope and Acceptance

A. These General Terms and Conditions of Purchase apply to all written and oral purchase orders and amendments thereto (collectively referred to as "Order") issued by the Buyer. All goods and services (whether or not ancillary to a sale of goods) to be provided under an Order are included in the term "Goods".

B. An Order for which written confirmation is requested may be accepted only by returning a copy thereof signed by the Seller within seven (7) days of its date. However, Buyer may elect to consider Seller's oral quotation or acceptance of an Order, Seller's preparation to provide the Goods, or Seller's delivery of the Goods, as an acceptance of an Order and its terms (and of no other terms) and enforce an Order. Buyer objects to any additional or contrary terms in Seller's quotation or acceptance, and the terms herein shall be binding upon the parties. An Order is not a firm offer and may be revoked prior to acceptance.

C. An Order does not constitute an acceptance by Buyer of any offer to sell, any quotation, or any proposal. Reference in an Order to any such offer to sell, quotation, or proposal shall in no way constitute a modification of any of the terms and conditions of an Order. A reference to Seller's proposal or quotation in an Order is not an acceptance to Buyer of terms which conflict with forms and documents provided by Buyer that are a part of an Order. TERMS AND CONDITIONS IN AN ATTEMPTED ACKNOWLEDGMENT OF AN ORDER INCONSISTENT WITH OR IN ADDITION TO THE TERMS AND CONDITIONS OF AN ORDER IS NOT BINDING UPON BUYER UNLESS SPECIFICALLY ACCEPTED BY BUYER IN WRITING, AND BUYER HEREBY OBJECTS THERETO. No course of performance or conduct by Buyer shall be construed to waive, modify or otherwise adversely affect Buyer's rights.

2 Prices

All prices shall be FOB destination (place of delivery). The prices in an Order shall be complete, and no additional charges of any type shall be added without Buyer's express written consent, including but not limited to, shipping, packaging, labeling, custom duties, taxes, storage, insurance, boxing and crating. All cash discounts shall be computed from the date of receipt by Buyer of a final invoice or receipt of the Goods, whichever occurs later.

3 Delivery

A. Delivery must be on the date indicated, if any, and otherwise as requested by Buyer. If delivery is "A.S.A.P." with a date indicated therewith, delivery must be on or before that date. If an Order is identified as a "Blanket" Order, deliveries are to be made only in quantities and at times specified in the delivery schedule set forth herein or as otherwise specified by Buyer. Buyer shall have no liability for payment of Goods delivered to Buyer which are in excess of quantities specified in an Order or in the delivery schedules. Buyer may, from time to time, change delivery schedules or direct temporary suspension of scheduled shipments.

B. All shipping, drayage, demurrage, storage, insurance, packing, and related charges shall be prepaid by Seller, and then billed to Buyer if Buyer is responsible for such charges according to the terms of an Order. All Goods shall be suitably packed, marked and shipped in accordance with the requirements of common carriers in a manner to secure the lowest transportation costs consistent with the requirements hereof. Packing slips identifying the purchase order number, release number and part number must accompany each shipment.

4 Risk of Loss and Title to Goods

A. All shipments are at the risk of the Seller, regardless of the F.O.B. point. If risk of loss is assumed by Buyer in writing, all risk casualty insurance for the full value of the Goods must be provided by the Seller for the benefit of Buyer. The cost of any insurance must be paid by the Seller unless otherwise agreed to in writing by Buyer. Under no condition will the risk of loss be that of Buyer unless such insurance is provided. Risk of loss shall not be governed by transfer of title.

B. Title to Goods shall vest in Buyer the earlier of the date of an Order and their identification to an Order. Identification shall occur not later than the date the Seller acquires or begins manufacture of the Goods.

5 Samples and Specifications

A. Seller, at its expense, shall fabricate from production tooling and processes and furnish to Buyer the number of samples specified on the face the Order, or if none is specified, a reasonable number of samples. Seller shall inspect such samples before delivery and shall certify inspection results in the manner requested by Buyer.

B. Buyer reserves the right at any time to make changes in quantities, drawings, specifications, testing or quality control, packing, shipment, scope of work and other terms of an Order. Any purported change shall be binding on Buyer only if made in a writing signed by Buyer. Any difference in price or time for performance necessarily resulting from such changes shall be adjusted equitably and an amendment to the Order or delivery schedule shall be provided in writing, provided Seller makes demand for such adjustments and delivers all supporting documentation within 10 days of receipt of Buyer's change. Time is of the essence for such demand. The price shall be adjusted solely to compensate Seller for increased costs of materials and direct labor costs necessarily incurred as a result of the changes. No adjustments shall be made for any change unless in a writing signed by Buyer. Seller may not substitute materials or change the specifications of the Goods in any way without written authorization from Buyer.

6 Safe Use and Maximum Life of Goods

Prior to and with the shipment of the Goods, Seller shall furnish to Buyer sufficient warning and notice in writing (including appropriate labels on the Goods, containers and packing) of any hazardous material with handling instructions necessary to advise carriers, Buyer, and their respective employees of measures that will best prevent bodily injury or property damage in the handling, transportation, processing, use or disposal of the Goods. Seller shall provide with the Goods in English in writing all information necessary for the safe installation, use, maintenance, and repairs of the Goods and to maximize the efficient use and useful life of the Goods.

7 Inspection

A. All Goods shall be received subject to right of inspection and rejection by Buyer and its customer. Buyer and its customer shall have a reasonable time, but not less than 30 days after delivery, to inspect delivered Goods prior to accepting the Goods. Defective Goods and Goods otherwise not in conformity with Buyer's specifications or an Order will be held for Seller's instructions at Seller's risk and, if Seller so directs, may be returned at Seller's expense. Goods returned as defective or nonconforming shall not be returned to Buyer without Buyer's approval. Payment for the Goods prior to inspection shall not constitute an acceptance thereof. In addition, Buyer may rely on Seller’s obligations and is not obligated to inspect goods prior to assembly or use. Acceptance, whether or not it has been revoked, shall not release Seller's responsibility for latent defects, non-conformities, or warranty claims.

B. If any inspection or test is made on the premises of Seller or its supplier, Seller without additional charge shall provide all reasonable facilities and assistance for the safety and convenience of the inspectors in the performance of their duties. All inspections and tests on the premises of Seller or its supplier shall be performed in such a manner as not to unduly delay the Seller.

8 Marking

Markings shall be in English, bar code, permanent, and such other form as determined by Buyer.

9 Confidential Information

Seller shall keep confidential any technical, process or economic information derived from drawings, specifications and other data furnished by Buyer in connection with an Order and shall not divulge, directly or indirectly, such information for the benefit of any other party without obtaining Buyer's prior written consent. Except as required for the efficient performance of an Order, Seller shall not use such information or make copies or permit copies to be made of such drawings, specifications, or other data without the prior written consent of Buyer. Upon completion or termination of an Order, Seller shall promptly return to Buyer all materials incorporating any such information and any copies thereof.

10 Patents, Trademarks and Copyrights

Seller shall defend and indemnify Buyer, its successors, assigns, customers and users of its products, against all suits at law or in equity and from all damages, claims and demands for actual or alleged infringement of any domestic or foreign patent, copyright or other property right by reason of the use or sale of the Goods. Seller grants to Buyer, its subsidiaries and affiliates an irrevocable, assignable, paid-up worldwide license under each copyright of Seller that is applicable to any intellectual property whatsoever furnished to Buyer in connection with the Goods. Title to any developments made by Seller while in performance of an Order which enhance Seller's products shall belong to Buyer.

11 Service and Replacement Parts

Seller shall sell to Buyer Goods as ordered by Buyer for it to fulfill its current model service and replacement parts requirements at the price(s) set forth in the Order. If the Goods are systems or modules, Seller shall sell to Buyer as ordered by Buyer the components or parts that comprise the system or module at price(s) that shall not, in the aggregate, exceed the price of the system or module less assembly costs. During the 15 year period after Buyer completes current model purchases, Seller shall sell Goods to Buyer as ordered to fulfill Buyer’s past model service and replacement parts requirements. Unless otherwise agreed to by Buyer, the price(s) during the first 3 years of this period shall be those in effect at the conclusion of current model purchases. For the remainder of this period, the price(s) for Goods shall be as agreed to by the parties. When requested by Buyer, Seller shall make service literature and other materials available at no additional charge to support Buyer’s service part sales activities. Notwithstanding the foregoing, this is not a requirements contract, and Buyer is only obligated to purchase Goods as stated in Buyer’s Order.

12 Warranty

A. Seller warrants and represents to Buyer and its customer that all Goods shall be: (i) merchantable; (ii) free from all defects in design, workmanship and materials; (iii) fit for the particular purposes for which they are purchased; (iv) in strict compliance with the specifications, samples, drawings, designs or other requirements (including performance specifications) approved or adopted by Buyer; and (v) provided with due care. Any attempt by Seller to limit, disclaim, or restrict any such warranties or any remedies of Buyer, by acknowledgement or otherwise, in accepting or performing an Order, shall be null, void, and ineffective without Buyer's prior written consent.

B. Seller warrants and represents to Buyer that the prices charged and to be charged Buyer are the same or lower than all prices charged others for the Goods or similar goods during the past 12 months.

C. Seller warrants that its performance of an Order shall be in compliance with the provisions of those sections of ISO-9001 applicable to the obligations of the Seller under the Order, whether or not Seller is registered under such standards.

13 Liability, Indemnity, and Insurance

A. Seller shall indemnify and protect Buyer against all liabilities, claims or demands for injuries or damages to any person or property arising out of the performance of an Order, by Seller, its servants, employees, contractors, agents, or representatives. Seller shall furnish an insurance carrier's certificate showing that Seller has adequate insurance coverage in the following minimum amounts: workmen's compensation - statutory limits for jurisdictions in which work is to be performed; employer's liability - $100,000.00; general liability - bodily injury $500,000/1,000,000; automobile liability - bodily injury $500,000.00 per person and $1,000,000.00 per occurrence and property damage $500,000.00. Liability coverage shall include completed products and operations coverage. The certificate must certify that the required insurance not be canceled or materially changed until ten days after prior written notice has been delivered to the Buyer.

B. If Seller's work under an Order involves operations by Seller on the premises of Buyer or one of its customers, Seller shall take all necessary precautions to prevent the occurrence of any injury to persons or damage to property during the progress of such work, and except to the extent that any such injury or damage is due solely and directly to Buyer's negligence, as the case may be, shall defend and indemnify Buyer against any claim which may result in any way from any act or omission of Seller, its agents, or subcontractors.

C. The Seller shall indemnify Buyer for any and all damages and reasonable expenses (including reasonable attorney fees) incurred because of property damages, personal injury, or other claims arising out of the condition, labeling, engineering, use, sale, storage, design, safety, etc. of the Goods whether or not incorporated in another product, if the damages claimed were not caused solely by Buyer. The Seller waives the application of the doctrine of comparative negligence.

14 Termination for Convenience

Buyer may immediately terminate all of any part of an Order or any releases issued pursuant to an Order for Buyer’s convenience, at any time and for any or no reason, by giving written notice to Seller. Upon such termination, Buyer shall pay to Seller in full satisfaction of any claim the following amounts without duplication: (i) an Order price for all custom manufactured Goods which have been completed in accordance with an Order or release not previously paid; and (ii) the actual direct costs of work in process and raw materials incurred by Seller in furnishing the customized Goods under an Order or any releases issued pursuant to an Order or release to the extent such costs are reasonable in amount and are properly allowable or apportionable, under generally accepted accounting principles, to the terminated portion of an Order or any releases issued pursuant to an Order; less, however, the reasonable value or cost (whichever is higher) of any Goods or materials used or sold by Seller with Buyer' written consent, and the cost of any damaged or destroyed Goods or materials.

15 Default and Remedies

A. Seller shall be in default: (1) if Seller fails to perform any obligation within the time specified herein or any extension thereof or upon Buyer's demand if no time has been specified; or (2) if Seller fails to perform any of the other provisions of an Order, or so fails to make progress as to make Buyer reasonably apprehensive about Seller's ability or willingness to perform its obligations; and if in either of these two circumstances Seller does not cure such failure within a period of two (2) days or such longer period as Buyer may authorize in writing after receipt of notice from Buyer specifying such failure. Upon such default, Buyer may by written notice of default to Seller (i) terminate the whole or any part of an Order; and (ii) procure alternative goods or services upon such terms as it shall deem appropriate. Seller shall continue performance of an Order to the extent not terminated and shall be liable to Buyer for any excess costs for such similar supplies or services and other direct, incidental, and consequential damages. As an alternative remedy, and in lieu of termination for default, Buyer, at its sole discretion, may elect (1) to extend the delivery schedule and/or (2) to waive other deficiencies in Seller's performance in which case an equitable reduction in an Order price shall be established by Buyer to compensate Buyer for its damages. In the event Seller for any reason anticipates difficulty in complying with the required delivery date, or in meeting any of the other requirements of an Order, Seller shall promptly notify Buyer in writing. The rights and remedies of the Buyer provided in this clause shall not be exclusive and are in addition to any other rights and remedies provided by law or under an Order. Time is of the essence as to Buyer's notices to Seller and Seller's performance.

B. If any of the Goods ordered are found at any time to be defective in design, material or workmanship, or otherwise not in conformity with the requirements of an Order, Buyer, in addition to such other rights, remedies and choices as it may have under an Order or by law, at its option and sole discretion may: (i) reject and return such Goods at Seller's expense; or (ii) require Seller to inspect the Goods and remove and replace nonconforming Goods with Goods that conform to an Order. If Buyer elects option (ii) above and Seller fails to promptly make the necessary inspection, removal and replacement, Buyer may at its option and Seller's cost, inspect and repair or replace the Goods.

C. Seller grants Buyer a security interest in the Goods to secure Seller's performance and return of deposits, and grants Buyer an irrevocable power of attorney to execute and file financing statements.

D. Seller's continued holding of the Goods and property delivered to Seller after proper demand has been made for delivery will substantially impair the value of the Goods and property, and Buyer shall be entitled to a court order for possession.

16 Material Furnished by Buyer and Its Customer

Unless otherwise agreed in writing, all tooling, equipment or material of every description furnished to Seller by Buyer or its customer or paid for by Buyer (“Furnished Property”), and any replacement thereof, or any materials affixed or attached thereto, shall be and remain the personal property of Buyer or its customer and held in trust for the benefit of Buyer or its customer. Furnished Property shall be plainly marked or otherwise adequately identified by Seller as the property of Buyer or its customer and shall be safely stored separate and apart from Seller's property. Buyer may enter Seller's premises and inspect Furnished Property and all related records during normal business hours. Seller shall not substitute any of its own property for Buyer's or Buyer's customer's property and shall not use Furnished Property except in filling an Orders. Such property while in Seller's custody or control shall be held at Seller's risk, shall be kept insured by Seller at Seller's expense in an amount equal to the replacement cost with loss payable to Buyer or its customer and shall be subject to removal at Buyer's written request, in which event Seller shall prepare Furnished Property for shipment and shall redeliver it to Buyer or its customer in the same condition as originally received by Seller, reasonable wear and tear excepted, all at Seller's expense. Seller waives any right to retain possession of Furnished Property to secure payment of amounts owed or for any other reason. Buyer may purchase from Seller specialized tooling and materials used in the production of Goods, at their unamortized cost.

17 Compliance With Laws

A. Seller shall promptly furnish to Buyer (i) upon written request a list of all materials in the Goods and, as necessary, the quantities of such and (ii) thereafter information concerning any change in composition of Goods.

B. Seller warrants that each chemical substance constituting or contained in the Goods sold is on the list of chemical substances compiled and published by the Administrator of the Environmental Protection Administration pursuant to the Toxic Substances Control Act (15 U.S.C. Sec. 2601 et. seq.) as amended, and that the Goods are not hazardous under any state or federal law except as clearly stated on the shipping and storage containers. Seller shall provide Material Safety Data Sheets as appropriate for the Goods.

C. Seller warrants that the Goods shall comply with applicable sections of the Federal Consumer Product Safety Act (15 U.S.C. Sec. 2051 et seq.) as amended, and the Federal Hazardous Substances Act (15 U.S.C. 1261 et seq.) as amended, and standards and regulations thereunder. Seller shall defend and indemnify Buyer from claims alleging improper dispositions of the Goods except for grossly negligent dispositions.

D. Seller warrants that the Goods shall be produced in compliance with the requirements of the Fair Labor Standards Act of 1938, as amended, including Section 12(a) and Seller shall insert a certificate to that effect on all invoices submitted in connection with an Order.

E. Seller warrants that it shall comply with all applicable industry, federal, state or local laws, rules, regulations or ordinances and standards as to the Goods and otherwise in the performance of an Order.

18 Applicable Law

An Order is to be construed and enforced under the laws of Michigan. The Convention on the International Sales of Goods shall not apply. The parties consent to the exclusive jurisdiction and convenience of the courts of Michigan, for all actions filed by Seller, and to their jurisdiction on actions filed by Buyer. Any declaration of unenforceability of a provision hereof shall be as narrow as possible and shall not void an Order or any other provision.

19 Entire Agreement

An Order (including these General Terms and Conditions of Purchase) is intended by the parties as a complete and exclusive statement of the terms of their agreement. No course of prior dealings between the parties and no usage of the trade may be used by Seller to supplement or explain any term used in an Order. All modifications and waivers must be in a writing signed by Seller and Buyer, except as otherwise provided in an Order.

20 Relationship of Parties

The parties are independent contracting parties only with no third party beneficiaries to an Order.

21 No Implied Waiver

The failure of either party at any time to require performance by the other party of any provision of an Order shall in no way affect the right to require such performance at any time thereafter, nor shall the waiver by either party of a breach of any provision of an Order constitute a waiver of any succeeding breach of the same or any other provision.

(2/25/19) Quotations and Purchase Orders - #268801.3
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