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Standard Terms of Purchase
EXCEPT TO THE EXTENT THAT THE FEDERAL ARBITRATION ACT APPLIES, THIS AGREEMENT IS SUBJECT TO ARBITRATION PURSUANT TO CHAPTER 48 OF TITLE 15 OF THE CODE OF LAWS OF SOUTH CAROLINA.
The purchase of products ("Products") by CompX Security Products Inc. (hereinafter referred to as "Purchaser") from seller ("Seller") shall be governed by the terms and conditions in any written contract currently in effect between Purchaser and Seller covering such sale and all other terms contained herein which are not inconsistent with such contract. To the extent that the terms and conditions of such written contract are silent with respect to any matter addressed herein, these terms and conditions shall govern. If there is no such written contract, then Purchaser shall purchase such Products from Seller only upon the terms set forth herein.
(b) Any terms proposed in Seller's acceptance of Purchaser's, offer which add to, vary form, or conflict with the terms herein are hereby objected to and rejected and Purchaser's offer shall be deemed accepted by Seller without such additional terms and conditions.
(c) This order is final, complete, and exclusive statement of the agreement between the parties and may not be modified, supplemented, explained or waived by parol evidence, Seller acknowledgements, a course of dealing or in any other way except by a written instrument executed by an authorized representative of both parties. Any references in this order to Sellers proposal or quotation are only to describe the materials or work covered hereby and do not constitute an acceptance of any terms set forth therein.
(d) Any terms proposed by Seller which add to, vary from or conflict with the terms herein are objected to and rejected, but such rejection shall not operate as a rejection of Seller's offer.
2. Performance by Seller.
(b) Seller warrants that material and work furnished hereunder shall be of the highest grade and quality unless otherwise specified and shall meet all standards of the Occupational Safety and Health Act of 1970 (OSHA) and all applicable state and local safety and health requirements. At Purchaser's option, any part of the material or work not complying with the requirements hereof, expressed or implied, may be returned at Seller's risk, and expense including transportation both ways, for prompt correction of defects. Payment by Purchaser shall not constitute acceptance of waive any rights of Purchaser hereunder.
(c) This order is issued to Seller in reliance on Seller's personal performance and Seller may not assign this order or the partial payment of any sums due hereunder or subcontract any substantial part of the performance or work other than for standard commercial supplies.
(d) Seller warrants that it shall comply with all applicable Federal, state, and local laws including the Fair Labor Standards Act of 1938, Executive Order 11246 and Title VII of the Civil Rights Act of 1964, including amendments and regulations issued pursuant thereto and this order hereby incorporated by reference all provisions required by said laws and regulations to be included herein.
(e) Seller agrees to exculpate, defend, indemnify and hold harmless the Purchaser and its customers from and against all claims, liabilities, lawsuits, expenses (including attorneys fees and other defense costs) and penalties, including those based on Purchaser's or its' customer's negligence which arise directly or indirectly, out of any of the following:
(f) If contract requires Seller to perform work on Purchaser's property, as long as this agreement is in force, Seller shall maintain at its sole cost, the following type of insurance with insurers acceptable to Purchaser:
All the insurance policies shall provide a wavier of subrogation in favor of Purchaser. In addition, the general liability policy shall name Purchaser as an additional insured. Any sub-contractors employed by the Contractor shall maintain the same level of insurance required of Contractor. Alternatively, Contractor's insurance policies may be extended to cover Sub-Contractor. Prior to the inception of any work under this agreement, Contractor shall provide renewal certificates to Company as long as this agreement is in force. Such certificates shall specify that Purchaser shall be given thirty (30) days notice prior to cancellation or material change of any of the required insurance policies. If required, Contractor shall provide Company with copies of the requested insurance policies.
3. Certain Charges or Expenses Negated. Unless otherwise specifically provided herein (i) no charges for transportation, packing, crating, storage or containers shall be allowed, (ii) Seller shall pay and the price includes all applicable sales and similar type taxes which are not imposed by law on the Purchaser, and (iii) any information or data disclosed or furnished to Purchaser by Seller hereunder shall be deemed sold as part of the price hereof, non-proprietary and free of all restrictions whatsoever.
4. Quality & Warranty. Seller agrees to provide goods in accordance with the latest version of Purchaser's released document including, but not limited to, all critical dimensions and tolerances unless otherwise agreed to in writing. Seller expressly warrants that all goods covered by this purchase order shall be fit and sufficient for the purpose intended, merchantable and free from defects.
5. Inspection/Rejection. All goods shall be subject to final inspection and acceptance or rejection by Purchaser after delivery, notwithstanding prior payment, it being understood that payment shall not create any presumption as to final inspection not constitute acceptance. Goods rejected and goods supplied in excess of quantities ordered hereunder may be returned to Seller at its expense and, in addition to Purchaser's other rights, Purchaser may charge Seller all expenses or unpacking examining, repacking and reshipping such goods.
6. Purchaser's Property.
(b) All materials, including tools, special dies and patterns, furnished or specifically paid for by the Purchaser, shall be the property of the Purchaser, shall be returned to Purchaser when no longer required hereunder, shall be used only to complete this order and shall be segregated and clearly identified as property of the Purchaser. Seller shall at no additional cost to Purchaser maintain all said items in good condition to the extent necessary for performance of this and future orders placed by Purchaser through a sound program of preventive maintenance. Seller shall establish, update and maintain a tooling inventory list, which will reflect current tooling status and in a timely manner notify Purchaser of damaged tooling in need of repair or replacement. Seller assumes all risk and liability for loss or damage thereto, except for normal wear, and agrees to permit inspection of inventory upon request of Purchaser. Purchaser does not warrant the accuracy of equipment or tools which it furnishes and all work must be in strict accordance with specifications.
(c) Seller agrees not to divulge information regarding Purchaser's intellectual property to any third part without express permission of Purchaser provided said information is identified as sensitive.
7. Changes. Purchaser may at any time by written notice make changes within the general scope of this order. If any such affects the time for or cost of performance, an equitable adjustment shall be made in the delivery schedule, purchase price, or both by agreement of the parties. All claims by Seller for adjustment under this clause must be asserted in writing and in full within thirty (30) days from the date of notification of the change or shall be waived. Nothing herein shall excuse Seller from proceeding with the order as changed. No extra shall be allowed except pursuant to written changes and this clause.
(b) To the extent this order covers items normally carried in inventory by Seller (as distinguished from items specially made to Purchaser's specifications), Purchaser shall have no liability for any termination of this order in whole or in part, prior to actual shipment and for any termination, within ten (10) days after receipt by Purchaser, its liability shall be limited to returning said items and reimbursing Seller for directs costs of handling and transportation.
(c) Purchaser shall not be liable for failure to take delivery of material or work or render any other performance in the event fire, accidents, labor difficulties, governmental action, third party failures or any other conditions beyond Purchaser's reasonable control render it commercially impractical for Purchaser to do so.
9. Termination for Cause. Purchaser may terminate this purchase order, in whole or in part, if Seller makes late deliveries, delivers defective or nonconforming goods, fails to provide adequate assurance of future performance upon request or otherwise fails to comply with the terms herein. If Purchaser terminates this purchase order for cause, Purchaser shall not be liable to Seller for any amount but Seller shall be liable to Purchaser for any and all losses Purchaser sustained by reason of Seller's default hereunder.
10. Termination of Blanket Orders. The quantities specified in this purchase order represent the estimated annual purchase volume at the time the purchase order was placed. The Purchaser reserves the right to change these quantities on a quarterly basis based on current market conditions. The Purchaser is under not obligation to purchase the total estimated quantities or total dollars, and may at any time terminate the purchase order. The Purchaser's liability with respect to such terminations shall be limited to the Seller's actual cost to manufacture the order. These costs are limited to: (1) a maximum of one month of finished goods inventory, and (2) six months of raw material inventory. These costs will be reduced by any materials that can be returned to a supplier, utilized by the Seller to manufacture another customer order, or returned for salvage. For the purpose of calculating Purchaser's liability: "months inventory" is defined as the remaining quantities to be purchased from the current submitted annual forecast, divided by the months remaining in that forecast.
11. Independent Contractor/Insurance. If Seller's employees or agents shall perform work on Purchaser's premises in fulfillment of this purchase order, Seller agrees that such work shall be performed as an independent contractor. As long as this agreement is in force, Seller shall maintain at its sole cost, the following type of insurance acceptable to Purchaser:
(a) Comprehensive General Liability - insurance with a combined single limit of $1,000,000 per occurrence with a minimum aggregate limit of $2,000,000. The policy shall include products/completed operations, contractual, broad form property damage, and contractor-protective coverage. The policy shall include a Cross Liability provision and coverage shall be on an "occurrence" basis.
(b) Workers' Compensation/Employers Liability - insurance with the following limits: Workers' Compensation - Statutory; Employers Liability - $100,000 per occurrence.
(c) Vehicle Liability - insurance to cover property damage or bodily injury to third parties as a result of the use of any Contractor's vehicles. The policy shall have a minimum limit of $1,000,000 per occurrence. All the insurance policies shall provide a waiver of subrogation in favor of Purchaser. In addition, the general liability policy shall name Purchaser as an additional insured. Any Sub-contractors employed by Seller shall maintain the same level of insurance required of Seller. Alternatively, Seller's insurance policies may be extended to cover Sub-contractor. Prior to the inception of any work under this agreement, Seller shall provide Purchaser with an insurance certificate(s) as evidence that the required insurance is in force. Seller will provide renewal certificates to Purchaser as long as this agreement is in force. Such certificates shall specify that Purchaser shall be given thirty (30) days notice prior to cancellation or material change of any of the required insurance policies. If required, Seller shall provide Purchaser with copies of the requested insurance policies.
12. Government Contracts. If this order is for material or work under a governmental contract or subcontract, all contract provisions applicable hereto and required by law, order, regulation or Purchaser's government contract or subcontract are hereby incorporated herein by reference as fully as if set forth herein in full. Where necessary to make the context of such provisions or clauses applicable to this order, the terms "Contractor", "Contract", and "Government" or "contracting Officer" (or terms of similar import) shall mean respectively Seller, this order, and Purchasers
(b) Limitation on Arbitration Remedies. THE ARBITRATORS SHALL HAVE NO POWER TO AWARD PUNITIVE, CONSEQUENTIAL, MULTIPLE, INCIDENTAL OR ANY OTHER DAMAGES IN EXCESS OF THE PURCHASE PRICE OF THE PRODUCTS AT ISSUE OR TO MODIFY THESE TERMS AND CONDITIONS OF SALE IN ANY WAY.