Standard Terms and Conditions of Purchase
1. ACCEPTANCE OF TERMS & CONDITIONS, ENTIRE AGREEMENT and PRECEDENCE.
Seller’s acknowledgment, acceptance of payment, or commencement of performance under this Purchase Order (may also be referred to as the “Contract”, or “Order”), shall constitute Seller’s unqualified acceptance of this Purchase Order. This Purchase Order expressly limits Seller’s acceptance to the terms set forth in the Company’s (“Buyer” or “Buyer’s”) Purchase Order. Additional or differing terms or conditions proposed by Seller or included in Seller’s acknowledgment to this Order are objected to by Buyer and have no effect unless expressly accepted in writing by Buyer. This Order is the sole and entire agreement of the Parties with respect to the work set forth, and integrates, merges, and supersedes any prior offers, negotiations, representations, warranties, agreements, and communications whether written or oral concerning the subject matter of this Order. This Order prevails over any of Seller’s general terms and conditions of sale or any other Seller document. Any inconsistencies in this Order shall be resolved in accordance with the following descending order of precedence: (1) Face of this Order, Release document or Schedule, (which shall include continuation sheets), as applicable, including any Special Terms & Conditions; (2) Any master-type agreement (such as corporate, sector or blanket agreements); (3) these General Provisions; and (4) Statement of Work.
2. APPLICABLE LAWS
This Order shall be governed by and construed in accordance with the law of the State of Michigan excluding its choice of law rules. The United Nations Convention on Contracts for the International Sale of Goods shall not apply to this Order.
3. COMPLIANCE WITH LAWS
Seller agrees to comply with all applicable laws, orders, rules, regulations, and ordinances. Seller represents, warrants and covenants to the Buyer that Seller (a) has and will maintain all licenses, permits, etc., required to perform the work set forth in this Order, (b) will comply with export and import laws of all countries involved in the work, (c) assumes all responsibility for shipments requiring government clearance, and (d) that Buyer may terminate this Order for default if any government authority imposes any duties or sanctions on goods. Seller represents that each chemical substance constituting or contained in the work sold or otherwise transferred to Buyer under this Order 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. Seller shall provide to Buyer with each delivery any Safety Data Sheet applicable to the work in conformance with and containing such information as required by the Occupational Safety and Health Act of 1970 and regulations promulgated under such Act, or its State approved counterpart.
4. ASSIGNMENT
No part of this Order may be assigned by Seller without the prior written approval of Buyer. Any such assignment without Buyer’s approval shall be void.
5. PRICE WARRANTY
Seller warrants that the prices contained in this Order are not in excess of Seller’s list, catalogue or published prices that such prices are not higher than prices charged to other purchasers purchasing similar equipment/product; that the said prices are not in excess of the prices provided by any applicable law, government decree, order, or regulations.
6. CHANGES
The Buyer Procurement Representative may, at any time by written notice, make changes in drawings, designs, specifications, materials, packaging, time and place of delivery and method of transportation. Changes may only be made in writing by the Buyer Procurement Representative. If any such change causes an increase or decrease in the cost of, or the time required for, performance of any part of this Order, Buyer shall make an equitable adjustment in the Order price and/or delivery schedule and modify the Order accordingly.
7. PACKING, SHIPMENT and DELIVERY
Unless otherwise specified, all work is to be packed in accordance with good commercial practice. Prices set forth in this Order include all charges for Seller’s packaging, crating, handling, storage and for transportation to FOB point unless noted on the Order. A complete packing list shall be enclosed with all shipments. Seller shall mark containers or packages with necessary lifting, loading, and shipping information, including the Order number, item number, dates of shipment, and the names and addresses of consignor and consignee. Bills of lading shall include this Order number. No merchandise will be accepted without a valid Order. Unless otherwise specified, delivery shall be FOB Destination. Seller shall be responsible for and bear the risk of any loss or damage to the goods until received by Buyer. Time is of the essence of this Order; and, if delivery of items or rendering of services is not completed by the time promised, Buyer reserves the right in addition to its other rights and remedies to terminate this Order for default.
8. INSPECTION AND ACCEPTANCE
Notwithstanding: (i) payment; (ii) passage of title; (iii) prior inspection or test, or (iv) execution of an acceptance document, Buyer may inspect all work prior to acceptance or rejection at reasonable times and places, including, when practicable, during manufacture and before shipment. Buyer may reject all or any portion of the work if it determines the work is nonconforming or defective. No such inspection shall relieve Seller of its obligations to furnish all Work in accordance with the requirements of this Order. If Buyer rejects any portion of the work, Buyer may; (i) accept all or part of such Work at an equitable price reduction; (ii) reject such work; or (iii) make, or have a third party make all repairs, modifications, or replacements necessary to enable such work to comply in all respects with Order requirements. Seller shall be liable to Buyer for any cost Buyer incurred to ensure such compliance. Seller shall not re-tender rejected work without disclosing the corrective action taken.
9. PAYMENTS, TAXES, AND DUTIES
Unless Buyer disputes an invoice in good faith or as otherwise provided, terms of payment shall be 60 days from the latest of the following: (i) Buyer’s receipt of the Seller’s proper invoice; (ii) scheduled delivery date of the work; or (iii) actual delivery of the Work. Buyer shall have a right of setoff against payments due or at issue under this Order or any other order between the Parties. All invoices must be mailed to the Buyer Accounts Payables department; Seller’s invoices are not to be used as packing slips nor are they to be sent with the material. Unless otherwise specified, prices include all applicable federal, state, and local taxes, duties, tariffs, and similar fees imposed by any government, all of which shall be listed separately on the invoice.
10. WARRANTY
Seller expressly warrants that: all goods or services furnished under this Order shall conform to all specifications and standards, will be new, and will be free from defects in material or workmanship; all such goods or services will conform to any statements made on the containers or labels or advertisements for such goods, or services, and that any goods will be adequately contained, packaged, marked, and labeled; all goods or services furnished under this Order will be merchantable and will be safe and appropriate for the purpose for which goods or services of that kind are normally used. If Seller knows or has reason to know the particular purpose for which Buyer intends to use the goods or services, Seller warrants that such goods or services will fit for such particular purpose; and the goods or services furnished will conform in all respects to samples, inspection, test, acceptance or use of the goods or services furnished under this Order. Such warranties shall survive inspections, tests, acceptance, and use. Seller’s warranty shall run to Buyer, its successors, assigns and customers, and users of products sold by Buyer. Seller agrees to replace or correct defects of any goods or services not conforming to the foregoing warranty promptly, without expense to Buyer, when notified of such nonconformity by purchaser, provided purchaser elects to provide seller with the opportunity to do so. In the event of failure of Seller to correct defects in or replace nonconforming goods or services promptly, Buyer, after notice to Seller, may make such corrections or replace such goods and services and charge Seller for the cost incurred by purchaser in doing so, along with incidental and consequential damages.
11. PROPERTY
Buyer may provide to Seller property owned by either Buyer or its customer (“Furnished Property”). Furnished Property shall be used only for the performance of this Order. Title to Furnished Property shall remain in Buyer or its customer. Seller shall clearly mark (if not so marked) all Furnished Property to show its ownership. Except for reasonable wear and tear, Seller shall be responsible for, and shall promptly notify Buyer of, any loss or damage. Without additional charge, Seller shall manage, maintain, and preserve Furnished Property in accordance with good commercial practice. Material made in accordance with Buyer’s specifications and drawings shall not be furnished or quoted to any other person or concern without Buyer’s written consent.
12. INTELLECTUAL PROPERTY OWNERSHIP
Buyer shall be entitled to full ownership of all data, information, inventions, or discoveries, whether patented or unpatented, conceived or first actually reduced to practice in the performance of this Order or any subcontracts of Seller related to this Order (collectively the “IP”). Seller assigns to Buyer all such IP and all intellectual property rights, including any trade secrets, patents and copyrights, and all IP applications. Seller further agrees to provide reasonable assistance to Buyer, at Buyer’s expense, for securing all such intellectual property rights. All Buyer’s IP shall be deemed proprietary to Buyer and shall not be used by others or disclosed to others without Buyer prior written permission. All copyrightable IP, which is created by Seller pursuant to this Order, shall be deemed “Works Made for Hire”, as that phrase is defined in the United States Copyright Act (17 U.S.C. §§ 101-1332), on behalf of Buyer, and Buyer shall own all right, title and interest, including the worldwide copyright, in and to such materials. Buyer shall become the sole owner of any and all notes, reports, memoranda, and any other information (regardless of the media of expression) made or prepared in connection with any order placed by Buyer. If by operation of law any of the material is not “Work Made for Hire”, then Seller agrees to assign, and hereby assigns, to Buyer the ownership of such material including all copyrights thereto. Seller shall provide any assistance required to perfect Buyer’s rights under this paragraph. The Seller agrees to promptly disclose any IP to Buyer and cooperate with Buyer and its agents in obtaining, at Buyer’s expense, any intellectual property rights Buyer deems necessary. Seller will procure from its employees and subcontractors, at Seller’s sole expense, all IP and the execution of all patent applications, assignments, and other instruments necessary for the procurement of patents, copyrights and other intellectual property rights and to the vesting of title to the IP in Buyer.
13. RELEASE OF INFORMATION
Except as required by law, no public release of any information, or confirmation or denial of same, with respect to this Order will be made by Seller without the prior written approval of Buyer.
14. PROPRIETARY INFORMATION
Information, including but not limited to technical and business information, provided by Buyer to Seller remains the property of Buyer. Seller shall keep confidential, during the existence of this Order as well as after, the features of any equipment, tooling, patterns, designs, drawings, processes, engineering and business data and other technical and proprietary information (without limitation), furnished by Buyer and use such items only in production of supplies under Orders from Buyer, unless Buyer’s written consent is first obtained. Upon termination or completion of this Order, Seller shall return all such items to Buyer or make other disposition, as directed by Buyer. Seller shall not provide any proprietary information to Buyer without prior execution by Buyer of a Proprietary Information Agreement or amendment to this Order providing for the same.
15. INDEPENDENT CONTRACTOR RELATIONSHIP
Seller is an independent contractor in all its operations and activities hereunder. The employees used by Seller to perform work under this Order shall be Seller’s employees exclusively without any relation whatsoever to Buyer. Neither Party has the authority to bind the other Party.
16. INSURANCE
Seller shall maintain all necessary insurance coverage, including public liability, product liability, and worker’s compensation insurance. If requested, Seller shall send a “Certificate of Insurance” showing Seller’s compliance with these requirements. Seller shall name Buyer as an additional insured for the duration of this Order. Insurance maintained pursuant to this clause shall be considered primary as respects the interest of Buyer and is not contributory with any insurance which Buyer may carry.
17. INDEMNIFICATION
Seller shall be responsible for any costs or expenses including attorneys’ fees, all expenses of litigation and/or settlement, and court costs, arising from any act or omission of Seller, its officers, employees, agents, suppliers, or subcontractors at any tier, in the performance of any of its obligations under this Contract. Seller will indemnify and hold Buyer and its directors, officers and employees (“Representatives”) harmless (and defend Buyer and its Representatives if it requests) as to any claims, liabilities, losses, damages and expenses (including, without limitation, actual attorneys’ fees and other legal expenses) brought against or incurred by Buyer or its Representatives because of any breach by Seller of any of its warranties to, or agreements with, Buyer or any death, injury or damage to any person or property alleged to have been caused by the components and work product pursuant to this Order or Seller’s manufacture of the same. Seller warrants that the Work performed and delivered under this Contract will not infringe or otherwise violate the intellectual property rights of any third party in the United States or any foreign country. Seller agrees to defend, indemnify, and hold harmless Buyer and its customers from and against any claims, damages, losses, costs and expenses, including reasonable attorneys’ fees, arising out of any action by a third party that is based upon a claim that the Work performed or delivered under this Contract infringes or otherwise violates the intellectual property rights of any person or entity.
18. LIMITATION OF LIABILITY, WAIVER, APPROVAL, AND REMEDIES
Buyer shall not be liable for any indirect damages including incidental, consequential, punitive, or exemplary damages, or lost profits. In addition, the maximum liability of Buyer for all damages on any type, including indirect damages and direct damages, shall be capped at the Order price. Failure by Buyer to enforce any of the provision(s) of this Order shall not be construed as a waiver of the requirement(s) of such provision(s), or as a waiver of the right of Buyer to enforce each and every such provision(s). Buyer’s approval of documents shall not relieve Seller from complying with any requirements of this Order. The rights and remedies of Buyer in this Order are cumulative and in addition to any other rights and remedies provided by law or in equity.
19. MAXIMUM INVENTORY
Seller, regarding its requirements as a supplier to Buyer, shall maintain no more than thirty (30) days of raw material, work-in-progress (WIP) and finished goods, in inventory unless authorized in writing by Seller.
20. FORCE MAJEURE
Seller shall not be liable for a reasonable delay or default in furnishing products under this Order and Buyer shall not be liable for failure to perform any of its obligations, to the extent that such delays or defaults or defaults on the part of Seller or such failure on the part of Buyer, are due to causes beyond their reasonable control (and not due to labor problems or Seller’s negligence or financial difficulties) including without limitation acts of God, fire, flood, storm, national emergency or war, provided that either party has given the other prompt notice of the commencement of the occurrence that caused the failure and shall continue to tender partial performance of the Order if possible. Notwithstanding the foregoing, in the event any delay in delivery by Seller caused by a force majeure event will, in Buyer’s opinion, cause a delay in delivery to Buyer’s customers, Buyer shall have the option to terminate all or a portion of this Purchase Order in order to obtain the Products elsewhere, without any liability to Buyer.
21. TERMINATION FOR CONVENIENCE
Buyer may terminate part or the entirety of this Order for its convenience by giving written notice to Seller. Buyer’s only obligation shall be to pay Seller a percentage of the price reflecting the percentage of the Work performed prior to the notice of termination, plus reasonable charges that Seller can demonstrate to the satisfaction of Buyer, using generally accepted accounting principles, have resulted from the termination. Seller shall not be paid for any work performed or costs incurred which reasonably could have been avoided. Buyer may audit any of Seller’s books and records in connection with any termination claim. In no event shall Buyer be liable for lost or anticipated profits, or unabsorbed indirect costs or overhead, or for any sum in excess of the total Contract price. Seller’s termination claim shall be submitted within forty-five (45) days from the effective date of the termination.
22. DEFAULT
Buyer, by written notice, may terminate this Order for default, in whole or in part, if Seller fails to comply with any of the terms of this Order, fails to make progress as to endanger performance of this Order, fails to provide adequate assurance of future performance, or in the event of Seller’s insolvency, bankruptcy or receivership. Seller shall have five (5) days (or such longer period as Buyer may authorize in writing) to cure any such failure after receipt of notice from Buyer. Default involving delivery schedule delays shall not be subject to the cure provision. Buyer shall not be liable for any Work not accepted; however, Buyer may require Seller to deliver to Buyer any supplies and materials, manufacturing materials, and manufacturing drawings that Seller has specifically produced or acquired for the terminated portion of this Order. Buyer and Seller shall agree on the amount of payment for these other deliverables. In the event of termination, in whole or in part, Buyer may acquire, under terms Buyer considers appropriate, supplies or services similar to those terminated, and the Seller will be liable to Buyer for any excess costs of those supplies or services, including any incidental costs Buyer incurs through re-procurement. Seller shall continue all Work not terminated. If after termination under paragraph (a), it is later determined that Seller was not in default, such termination shall be deemed a Termination for Convenience. The Supplier is liable for all direct, incidental, and consequential damages, losses, costs, and expenses incurred by the Buyer resulting from the failure of the Supplier to deliver conforming Goods or to comply with the shipping and delivery or other requirements of the Buyer, even if the Supplier has cured the failure. These include costs associated with the off lining of vehicles or the Goods, interruptions, or delays in production, reduced line-speeds, and plant shutdowns.
23. DISPUTES
All disputes under this Order which are not disposed of by mutual agreement may be settled at Buyer’s sole discretion either by submitting the claim to (i) a court of competent jurisdiction in Washtenaw County in the State of Michigan, whose state and federal courts the Parties agree to be bound by and no action shall be filed in the courts of any other state or (ii) binding arbitration, before a single arbitrator, in Washtenaw County in the State of Michigan, in accordance with the Commercial Arbitration Rules of the American Arbitration Association; and judgment upon the arbitrator’s award may be entered in any court having jurisdiction thereof. Until final resolution of any dispute under this Order, Seller shall diligently proceed with the performance of this Order as directed by Buyer.
24. SEVERABILITY
Each paragraph and provision of this Order is severable, and if one or more paragraphs or provisions are declared invalid, the remaining provisions of this Order will remain in full force and effect.