FERGUSON PERFORATING COMPANY TERMS AND CONDITIONS OF PURCHASE – DATED 07/27/22
- CONTRACT – These Terms and Conditions of Purchase (“Terms and Conditions”) apply to purchase orders (“Orders”) by Ferguson Perforating Co. (“PURCHASER”) for products and/or services (“Goods”) supplied by seller (“SELLER”). SELLER’S ACCEPTANCE OF ANY PURCHASE ORDER ISSUED BY PURCHASER IS EXPRESSLY MADE CONDITIONAL ON SELLER’S ASSENT TO THESE TERMS AND CONDITIONS AND PURCHASER HEREBY OBJECTS TO ANY ADDITIONAL OR DIFFERENT TERMS IN ANY RESPONSE TO THIS OFFER. The parties intend that these Terms and Conditions, together with the description of Goods and other information on PURCHASER’s Order, constitute the final, complete, exclusive, and fully integrated terms of the contract. Any other prior or contemporaneous agreements, oral or written, are hereby Any modification or waiver of these Terms and Conditions, whether evidenced by language or conduct, shall be null and void unless they are evidenced by a writing signed by an authorized representative of PURCHASER. PURCHASER hereby rejects all pre-printed terms and conditions proposed by SELLER in any quotation issued by SELLER, even if there is a reference in an Order to SELLER’s quotation or other form related to the Goods. SELLER’S WRITTEN ACKNOWLEDGMENT OF AN ORDER, COMMENCEMENT OF WORK ON THE GOODS, OR DELIVERY OF ANY GOODS HEREUNDER WILL CONSTITUTE ITS UNCONDITIONAL ACCEPTANCE OF THESE TERMS AND CONDITIONS.
- SEPARATE SUPPLY AGREEMENT – Notwithstanding the above, in the event and to the extent of any conflict or inconsistency between these Terms and Conditions and any supply agreement duly executed and delivered by an authorized representative of both PURCHASER and SELLER with respect to the subject matter hereof, the provisions of such supply agreement shall control.
- CHANGE ORDERS – PURCHASER reserves the right at any time to make changes in any one or more of the following: (a) specifications, drawings, and data for items to be specially manufactured by SELLER for the PURCHASER, (b) methods of shipment or packing, (c) place of delivery, and (d) times of If any such change causes an increase or decrease in the cost of or the time required for delivery of the Goods pursuant to this Order, SELLER shall notify PURCHASER in writing (with sufficient supportive detail and documentation) within five (5) days after receipt of PURCHASER’s notice, of and the extent to which SELLER believes such changes so affect the cost or time of performance. PURCHASER and SELLER shall mutually agree in writing to an equitable adjustment of the price or delivery date, as the case may be, to reflect the effect of such change. In the event that PURCHASER and SELLER cannot agree to an equitable adjustment, such dispute shall be settled by binding arbitration with one arbitrator in accordance with the rules of the American Arbitration Association, with such arbitration to take place in Boston, Massachusetts. At PURCHASER’s option, SELLER shall proceed with this Order as changed prior to the resolution of the dispute. SELLER’s failure to so notify PURCHASER shall be deemed a waiver of any right to claim any adjustment as provided hereunder or otherwise. Price increases, extensions of time for delivery or any other substitution, change or modification shall not be binding on PURCHASER unless evidenced by a purchase order change notice issued and signed by PURCHASER.
- CANCELLATIONS – PURCHASER may in its sole discretion, cancel all or any portion of this Order without any liability to SELLER provided such cancellation occurs at least sixty (60) days prior to the scheduled delivery date for such Goods.
- TITLE AND RISK OF LOSS – Title to the Goods herein described shall not pass until said Goods have actually been received by PURCHASER or its consignee, notwithstanding any agreement to the contrary, including, but not by way of limitation, any agreement to pay freight, express or other transportation or insurance charges. Risk of loss or damage in transit prior to such actual receipt by PURCHASER or its consignee shall be borne by SELLER. Nothing herein contained, however, shall be construed as depriving PURCHASER of its interest, or limiting such interest, in the Goods herein described prior to such actual receipt.
- SHIPPING INSTRUCTIONS: NOTICE OF SHIPMENT – Unless otherwise specified, packages must bear this Order number and bulk containers must also show gross, tare, and net weights and/or No packaging, shipping, or handling charges shall be charged to PURCHASER unless specified on the face hereof. If PURCHASER specifies a method of shipment or specific carrier, SELLER shall use such method of shipment or specific carrier. All Goods must be suitably packed and classified to assure the lowest transportation rates consistent with full protection against loss or damage in transit and to meet the carrier’s requirements. SELLER must mail to PURCHASER’s issuing office on day of shipment, a bill of lading or other notice of shipment, giving this Order number and car number, if carload shipment. In the case of shipment F.O.B. elsewhere than PURCHASER’s plant, the original bill of lading must be mailed. Packing slips shall be enclosed with all shipments, showing this Order number, part number(s) and quantity. On shipments not accompanied by SELLER’s itemized packing list, PURCHASER’s count shall be accepted as final and conclusive.
- DELIVERIES – Time is of the essence in SELLER’s performance of this Order. Delivery must be affected within the time stated on this Order or otherwise agreed upon in writing. Any Goods delivered thereafter may be rejected or returned at SELLER’s risk and expense unless PURCHASER has authorized such late shipment in writing for each instance. SELLER shall promptly notify PURCHASER of any actual or anticipated delay in delivery and shall take all reasonable steps to avoid or end such delay without additional cost to Deliveries shall be made to PURCHASER’s receiving area, not to individuals or departments. If SELLER fails to deliver any shipment of Goods in accordance with PURCHASER’s instructions, PURCHASER may cancel the Order for such Goods and/or purchase substitute goods, in which event, SELLER will reimburse PURCHASER for its costs in procuring the substitute goods as well as additional production expenses. These costs may include, but are not limited to, premium freight, overtime, production downtime, rework, inspection, expediting and the like. If applicable, these costs shall also include any charges incurred by PURCHASER from any customer of PURCHASER.
- INSPECTION – SELLER shall inspect the Goods prior to shipment to All inspection records of SELLER related to the Goods shall be maintained by SELLER for a minimum of ten (10) years after delivery of such Goods to PURCHASER. All material and workmanship shall be subject to inspection and test by PURCHASER. PURCHASER reserves the right to reject any Goods which contain defective material or workmanship, which are not in accordance with the instructions of PURCHASER, which fail to meet the specifications provided by PURCHASER or result in a breach of SELLER’s warranties (express or implied). In the event of any nonconformity of the Goods, PURCHASER, at its option may: (i) cancel this Order as to such rejected Goods, in which case SELLER will refund to PURCHASER all amounts paid for such rejected Goods within thirty (30) days of PURCHASER’s cancellation; or (ii) require SELLER to promptly replace such rejected Goods with conforming Goods without any additional charge to PURCHASER. Rejected Goods shall be removed at the expense of SELLER including transportation both ways, promptly after notification of rejection. SELLER shall bear all costs of inspection and all risk of loss of rejected Goods. In the event SELLER has been provided notice of such rejection and has failed to promptly correct such defect, SELLER shall reimburse PURCHASER for repairs or replacements made by PURCHASER or its designee, to correct such defect. The remedies provided to PURCHASER in this section shall be in addition to and not in lieu of any additional remedies PURCHASER may have in law or in equity based on SELLER’s failure to perform its obligations under this Order.
- PAYMENT AND PRICE – Payment by PURCHASER for Goods supplied hereunder shall not constitute acceptance thereof if subsequent inspection discloses defective material or workmanship or a failure to meet the specifications or instructions of PURCHASER or a breach of SELLER’s warranties (express or implied). PURCHASER shall not be billed at prices higher than stated on this Order unless authorized by a purchase order change notice issued and signed by PURCHASER. Unless otherwise stated on the face hereof, invoices subject to discount will be discounted if paid within fourteen (14) days of the date of the invoice or the date of receipt of Goods, whichever is Net bills will be paid within fifty-five (55) days of the date of the invoice or the date of receipt and inspection of Goods, whichever is later. PURCHASER shall receive the benefit of any general reduction in SELLER’s prices prior to delivery, and in no event shall PURCHASER be charged a price higher than charged to SELLER’s other customers for Goods of like grade and quality. PURCHASER may withhold or set off from any payment any amount as to which a dispute exists under any Order or against any amount due PURCHASER or any affiliate of PURCHASER under any transaction with SELLER.
- REJECTION AND CANCELLATION – PURCHASER reserves the right to reject any Goods and to cancel all or any part of this Order if SELLER fails to deliver all or any part of the Goods in accordance with the terms, conditions, instructions, and specifications contained herein or supplied by PURCHASER. Acceptance of any part of the Goods covered by this Order shall not obligate PURCHASER to accept future shipments nor deprive it of the right to revoke any acceptance previously given. If SELLER ceases to conduct its operations in the ordinary course of business (including inability to meet its obligations as they mature), or if any proceeding under bankruptcy or insolvency laws is brought by or against SELLER or if a receiver for SELLER is appointed or applied for, or if a general assignment for the benefit of creditors is made by SELLER, or SELLER is in default of any provision or requirement of this Order, PURCHASER may by written notice to SELLER without prejudice and in addition to any other rights or remedies which PURCHASER may have, cancel this Order without liability except for deliveries previously made. In the event of such cancellation, PURCHASER may complete the performance of the Order by such means as PURCHASER selects, and SELLER shall be responsible for any additional costs incurred by PURCHASER in so doing in addition to any other rights or remedies PURCHASER may have, at law or in equity. SELLER shall deliver or assign to PURCHASER any work-in-progress as PURCHASER may request together with any equipment, information and manufacturing materials specifically provided, produced, or acquired for performance of this Order. Any amounts due SELLER shall be subject to setoff of PURCHASER’s additional costs of completing this Order and other damages incurred by PURCHASER as a result of SELLER’s default.
- WAIVERS – PURCHASER’s waiver of any default, breach, or failure to enforce any of the terms, conditions, instructions, or specifications related to this Order shall not in any way affect, limit or waive PURCHASER’s right thereafter to enforce and compel strict compliance with every term, condition, instruction and specification hereof or any subsequent default or breach.
- WARRANTIES – SELLER makes the following warranties for the Goods to the PURCHASER, its successors, assigns, customers and the users of the Goods, and all such warranties shall be in addition to any and all other warranties, express or implied, which may be prescribed by law or in equity: (a) SELLER shall, at the date of delivery, have full, good and marketable title to the Goods; (b) the Goods shall be free and clear of any and all liens, restrictions and encumbrances; (c) the Goods shall be new, fit and sufficient for their intended uses, and conform to specifications, drawings, and other descriptions supplied by PURCHASER and shall be free from defects (patent or latent) in materials and workmanship; (d) the Goods will be free from defects in design; (e) SELLER has complied with all quality standards and procedures furnished by PURCHASER or generally applicable in the industry and all applicable laws, regulations, standards, ordinances and orders in performing the Order; and (f) the prices charged to PURCHASER for the Goods are and will remain no less favorable than SELLER’s prices to other customers for the same or comparable goods or services and SELLER will reduce its prices under this Order if necessary at any time to maintain this warranty. Such warranties, including warranties prescribed by law, shall run for a period of two (2) years after delivery unless otherwise stated.
SELLER warrants that all services which are part of the Goods will be performed in a professional manner and consistent with the highest standards in the industry for similar services.
In the event of breach of the warranty, PURCHASER, at its option, may: (i) cancel the Order as to such Goods, in which case SELLER will refund to PURCHASER all amounts paid for such Goods within thirty (30) days of PURCHASER’s cancellation; (ii) require SELLER to promptly replace such Goods with conforming Goods without additional charge to PURCHASER; (iii) repair or replace the Goods in which case SELLER shall reimburse PURCHASER for all costs related to such repair or replacement. Goods shall be removed after notification of rejection. SELLER shall bear all risk of loss of rejected Goods.
- FORCE MAJEURE – In the event of fire, accidents, “acts of God”, strikes or other labor disputes, government acts or other conditions beyond the PURCHASER’s reasonable control which prevent PURCHASER’s prompt utilization of the Goods covered by this Order, PURCHASER may cancel this Order in whole or in part as to Goods not yet shipped by notice to SELLER.
- INDEMNIFICATION– SELLER shall indemnify, defend and hold PURCHASER, its successors, assigns, customers, affiliates, employees, agents, and users (collectively, the “Indemnified Parties”), harmless from and against any and all claims, liabilities, losses, fines, penalties, damages and expenses (including reasonable attorneys’ fees and court costs) which the Indemnified Parties may sustain or incur as a result of any claim of damage, loss, injury or death to any person or entity or property of any person or entity relating to or resulting from (i) the Goods; (ii) claimed infringement of any patent, trademark, trade secret, copyright, or other proprietary right of any other party arising out of the use, sale, importation, distribution, reproduction or licensing of the Goods (“Indemnified IP”); or (iii) any other act or omission of SELLER or its subcontractors related to the Order, including any agents or employees engaged in the manufacture, installation, delivery, erection, repair, or operation of any Goods. PURCHASER shall notify SELLER promptly of any such suit, claim or proceeding and give SELLER sole authority and all necessary information and assistance (at SELLER’s expense) for the defense or settlement of same, and SELLER shall pay all damages, costs and expenses incurred or awarded therein, including reasonable attorneys’ fees. Notwithstanding the foregoing, any settlement of such suit, claim or proceeding which impacts PURCHASER in any way shall be subject to PURCHASER’s consent, such consent not to be unreasonably withheld. If use of any Indemnified IP is enjoined, SELLER shall, at PURCHASER’s option and SELLER’s expense, either: (a) procure for PURCHASER the right to continue using such Indemnified IP; (b) replace the same with a non-infringing equivalent; or (c) remove the Indemnified IP and/or halt such use of the Indemnified IP in providing goods and/or services under this Order and refund the purchase price to PURCHASER, and in all cases, SELLER shall be responsible for all related costs and expenses. SELLER agrees that it shall use commercially reasonable efforts to obtain an intellectual property infringement indemnity from its direct or indirect suppliers providing goods and/or services as part of the deliverables under this Order consistent with the intellectual property infringement indemnity it provides to PURCHASER in this Order. SELLER’s indemnification obligations hereunder shall not apply to the extent such claim is solely based on designs or other material provided by PURCHASER.
- CONFIDENTIAL INFORMATION– Except as necessary to perform this Order, as required by law (upon prior written notice to PURCHASER), or with PURCHASER’s prior written consent, SELLER will, at all times, keep confidential all information, drawings, specifications and data furnished by PURCHASER (whether in writing, electronically, orally, or visually) or derived or developed by SELLER for the purpose of performing this Order (collectively, “Confidential Information”). SELLER agrees to take all reasonable steps to protect the confidentiality of PURCHASER’S Confidential Information. SELLER will not disclose such Confidential Information, use such Confidential Information for its own benefit or for the benefit of any other party, copy it, or permit copies to be made without the prior written consent of PURCHASER. Upon termination of this Order, and, at any time upon written request, SELLER will return all copies of PURCHASER’S Confidential Information to PURCHASER. These confidentiality obligations do not apply to information lawfully known by SELLER at the time of disclosure by PURCHASER or obtained by SELLER from a third party entitled to disclose it, or to information that becomes public knowledge other than through disclosure by SELLER. SELLER will not publish or advertise the existence or nature of this Order without PURCHASER’S prior written consent. SELLER acknowledges that a breach of this Section may cause irreparable harm and money damages would not be a sufficient remedy and that PURCHASER may seek injunctive relief in addition to other remedies available at law or SELLER’S obligations under this Section shall survive termination or completion of an Order Confidential Information shall not include: (a) any information which is in the public domain or enters the public domain, other than through breach of this Section by SELLER, after disclosure to SELLER; or (b) is received by SELLER from a third party without any obligation of confidentiality provided that such third party had a right to disclose such information to SELLER without any obligation of confidentiality.
- TAXES – Except as may be otherwise specified in this Order, the prices specified in this Order include all federal, state, local or foreign taxes, levies, duties or other government charges upon the manufacture, sale, or transportation of the Goods described herein.
- SPECIAL TOOLING. All dies, jigs, fixtures, drawings, molds, patterns, templates, gages and the like which are either expressly identified in this Order as PURCHASER’s property or made or acquired by SELLER for use in manufacturing or assembling Goods which are proprietary to PURCHASER constitute “Special ” All Special Tooling will belong solely to PURCHASER, subject to payment of the purchase price (if any) for the Special Tooling which is set out in the Order. No such payment will be due until SELLER has provided an itemized list of the Special Tooling and PURCHASER has accepted the Special Tooling or the first run of Goods manufactured or assembled with it. SELLER will maintain adequate cost records for all Special Tooling and make such records available for review or audit by PURCHASER. If SELLER fails to maintain such records, PURCHASER’s sole obligation to SELLER will be to pay the fair market value of the Special Tooling in lieu of the purchase price set out in the Order. While the Special Tooling is in its possession or custody, SELLER will be responsible for any loss or damage to it and for all taxes, assessments, and similar charges levied with respect to or on it. SELLER shall insure the tools with full fire extended coverage insurance for the replacement value of the Special Tooling. SELLER will label the Special Tooling in such manner as to permit accurate identification of it at all times and will segregate it from other tooling in SELLER’s possession. SELLER will repair and maintain the Special Tooling to keep it in good working condition and will replace it at SELLER’s expense, as necessary. SELLER will use the Special Tooling exclusively to produce Goods for PURCHASER hereunder and for no other use. Upon expiration, cancellation, or termination of the Order, SELLER will hold the Special Tooling and any operation sheets, process data, or other information necessary to show its use, at no charge, pending receipt of PURCHASER’s instructions about its removal or disposition, which will be at PURCHASER’s expense.
- COMPLIANCE WITH LAWS AND GOVERNMENTAL REQUIREMENTS – SELLER shall comply with all applicable state, federal, local, national and provincial laws, rules and regulations, including but not limited to the most current European regulation for Registration, Evaluation, Authorization (and Restriction) of Chemicals (“REACH”), the most current European Restriction of the use of certain Hazardous Substances Directive (“ROHS”), the most current European Waste Electrical and Electronic Equipment Directive (“WEEE”), and the U.S. Occupational Safety and Health Act of 1970 (OSHA) and the FARs related to hazardous materials and waste. If Goods are considered toxic or hazardous as defined in the above regulations, SELLER shall provide a copy of the Safety Data Sheet (SDS) with each shipment or as otherwise specified on the Order.
- INSURANCE– During the term of the Order, at its own expense, SELLER will maintain insurance coverage for workers’ compensation, general liability (including contractual liability and products liability) and automobile liability in amounts and with insurers satisfactory to PURCHASER. On request, SELLER will furnish PURCHASER with certificates of insurance that evidence this coverage, name PURCHASER as an additional insured, and prohibit the cancellation or reduction of coverage without 15 day’s prior written notice to PURCHASER. Compliance with this Section will not relieve SELLER of its other obligations under these Terms and Conditions.
- ASSIGNMENT – SELLER shall not assign or delegate this Order, or the contract formed as a result of accepting this Order in whole or in part without the prior written consent of PURCHASER. PURCHASER reserves the right to assign this Order to its subsidiaries and affiliates, successors and This Order will bind and inure to the benefit of the parties hereto and their respective successors, permitted transferees, and permitted assigns.
- GOVERNMENT CONTRACTS, ADDITIONAL TERMS – If this Order bears a S. Government contract number or if SELLER is otherwise informed that the Goods or services covered by this Order are to be supplied directly or indirectly to the U.S. Government, any terms and conditions which may be required to be agreed to by SELLER as a condition to supplying Goods or services pursuant to such U.S. Government contract are hereby incorporated by reference. In the event of any inconsistency between the required terms of such U.S. Government contract and the terms of this Order, the required terms of such U.S. Government contract shall apply.
- EMPLOYMENT PRACTICES – SELLER and its subcontractors shall abide by the requirements of 41 CFR §§ 60-1.4(a), 60-300.5(a) and 60-741.5(a). These regulations prohibit discrimination against qualified individuals based on their status as protected veterans or individuals with disabilities and prohibit discrimination against all individuals based on their race, color, religion, sex, sexual orientation, gender identity or national origin. Moreover, these regulations require that covered prime contractors and subcontractors take affirmative action to employ and advance in employment individuals without regard to race, color, religion, sex, sexual orientation, gender identity, national origin, protected veteran status or disability. SELLER and its subcontractors shall abide by the employee notice requirements set forth in 29 CFR part 471, Appendix A to Subpart A.
- RIGHT OF ACCESS – SELLER shall permit any authorized representative of PURCHASER or PURCHASER’s customer to inspect any or all of the work included in this Order at SELLER’s facility upon reasonable advance notice.
- HAZARDOUS MATERIALS – SELLER shall provide written notice to PURCHASER upon receipt of an Order if the products or services furnished in connection therewith are subject to the laws or regulations relating to hazardous or toxic substances, or when disposed of, to regulations governing hazardous wastes, or to any other environmental or safety and health regulations. SELLER shall furnish all appropriate shipping certifications and any notices, forms or other information required to be supplied to a purchaser or user of hazardous or toxic substances pursuant to applicable laws or regulations, and instructions for shipping, safety, handling, exposure, and disposal in a form sufficiently clear for use by PURCHASER’s nontechnical personnel and sufficiently specific to identify all action which the user must take concerning the material. The following certification must be made on the bill of lading: “This is to certify that the above-named articles are properly classified, described, packaged, marked and labeled and are in proper condition for transportation according to any applicable transportation regulations.”
- LIMITATION OF LIABILITY – IN NO EVENT WILL PURCHASER BE LIABLE TO SELLER FOR ANY SPECIAL, INCIDENTAL, PUNITIVE OR CONSEQUENTIAL DAMAGES REGARDLESS OF THE LEGAL THEORY ON WHICH ANY LIABILITY CLAIM IS MADE. In no event will PURCHASER’S liability to SELLER exceed the amount due under the applicable Order for the Goods.
- TRADE CREDITS, COUNTRY OF ORIGIN – All offset or countertrade credit value resulting from this Order shall accrue solely to the benefit of PURCHASER. SELLER agrees to cooperate with PURCHASER in the fulfillment of any foreign offset/countertrade obligations as a condition of this Order.
- COMPLIANCE WITH EXPORT REGULATIONS – SELLER shall comply with all applicable registration and licensing requirements under the export control laws of the United States and the laws of the countries in which SELLER operates. SELLER shall not disclose, transfer or export hardware or technical data controlled under the International Traffic in Arms Regulations (“ITAR”) or the Export Administration Regulations (“EAR”) to any non-U.S. person or firm, including non-U.S. persons employed by or associated with SELLER, nor to any non- U.S. government, without first complying with all requirements of the ITAR or the EAR, including the requirement for obtaining an export license or other required authorization. SELLER shall provide to the PURCHASER the USML category number and/or the Export Control Classification Number, as applicable, for products and technical data delivered under this Order. SELLER shall comply with all United States Department of Commerce Safe Harbor requirements relating to the protection of personal data.
All manufacturers, exporters, and brokers of defense articles, defense services, or related technical data, as defined on the United States Munitions List (part 121 of the ITAR), are required to register with the U.S. Department of State’s Directorate of Defense Trade Controls (“DDTC”). Certain PURCHASER entities are manufacturers of defense articles, and as such, certain sellers of specifically designed parts, components, accessories, and attachments are also considered manufacturers of defense articles under the ITAR. Therefore, in order to comply with the ITAR, PURCHASER’s U.S. Sellers of defense articles under subcontract to PURCHASER must access: http://www.pmddtc.state.gov/registration/index.html and review the DDTC registration requirements.
- CONFLICT MINERALS – SELLER warrants and certifies that it complies with Section 1502 of the Dodd Frank Act and the Conflict Minerals Regulations and Final Rules issued by the U.S. Securities and Exchange Commission, and any subsequent rules and regulations related thereto (“Conflict Minerals Regulations”) and has implemented compliant processes to ensure its suppliers are in compliance with the Conflict Minerals Regulations. Where SELLER does not have direct and formal reporting requirements under the Conflict Minerals Regulations, and upon request by PURCHASER, SELLER agrees to provide due diligence and Responsible Country of Origin Inquiry (“RCOI”) information under this Agreement to PURCHASER in support of PURCHASER’s reporting requirements (the “RCOI Requirements”). Further, SELLER shall promptly comply with all requests by PURCHASER to provide documentation, and other substantiating data and assurances with respect to its compliance with Conflict Minerals Regulations and the RCOI Requirements as PURCHASER may deem necessary from time to time. In the event: (a) PURCHASER deems SELLER is not in compliance with the Conflict Minerals Regulations or the RCOI Requirements, (b) PURCHASER is not satisfied with the outcome of any review of SELLER documentation and/or data or otherwise, or (c) SELLER does not provide the documentation, other data and/or other further assurances to PURCHASER as requested by PURCHASER, PURCHASER shall have the right to terminate any Order or any portion thereof without penalty or further liability to SELLER.
SELLER shall indemnify and hold harmless PURCHASER, its directors, officers, employees, agents, and invitees from and against all liability, demands, claims, losses, costs, damages, and expenses, including but not limited to attorneys’ fees, arising from or in any way related to SELLER’s failure to comply with the Conflict Minerals Regulations, the RCOI Requirements and the requirements herein.
- COUNTERFEIT GOODS – For the purposes of this Article, Goods consist of those parts deliverable under this Order that are the lowest level of separately identifiable items (e.g., articles, components, goods and assemblies). “Counterfeit Goods” means Goods that have been misrepresented as having been designed and/or produced under an approved system or other acceptable Counterfeit Goods include, but are not limited to Goods that: (i) are an illegal or unauthorized copy or substitute of an Original Equipment Manufacturer (“OEM”) item; (ii) are not sufficiently traceable to an OEM to ensure authenticity in OEM design and manufacture; (iii) do not contain the proper internal or external materials or components or are not manufactured in accordance with the OEM design; (iv) are used, refurbished, or reclaimed but that SELLER represents as being new; (v) have not successfully passed all OEM required testing, verification, screening, and quality control but that SELLER represents as having met those requirements; (vi) have a label or other marking intended, or reasonably likely, to mislead a reasonable person into believing a non-OEM Good is a genuine Good or Item when it is not.
SELLER warrants and certifies that Goods delivered pursuant to this Order, unless otherwise specifically stated on the face of the Order, shall (i) be new, (ii) be and only contain materials obtained from the OEM or an authorized OEM reseller or distributor, (iii) not be or contain any Counterfeit Goods, and (iv) contain only authentic, unaltered OEM labels and other markings. Goods shall not be acquired from independent distributors or brokers unless specifically authorized in writing by PURCHASER.
SELLER shall maintain a method of item traceability that ensures traceability of the supply chain back to the manufacturer of all electrical, electronic, and electromechanical parts sold separately as Goods or included in assemblies and subassemblies being delivered per this Order. This traceability method shall clearly identify the name and location of all of the supply chain intermediaries from the manufacturer to the direct source of the product for SELLER and shall include the manufacturer’s batch identification for the item(s) such as date codes, lot codes, serializations, or other batch identifications. When requested by PURCHASER, SELLER shall provide OEM documentation that authenticates traceability of the affected items to the applicable OEM. PURCHASER shall have the right to audit, inspect, and/or approve the methodology described herein at any time before or after delivery of the Goods ordered hereunder. PURCHASER shall have the right to require changes to the processes to conform with PURCHASER’s defined standards, if any.
SELLER shall immediately notify PURCHASER in writing of the pertinent facts if SELLER knows or has reason to believe that Counterfeit Goods have been delivered under the applicable Order.
In the event Goods delivered under this Order constitute Counterfeit Goods, SELLER shall at its expense promptly replace such Goods with genuine Goods conforming to the requirements of this Order. Notwithstanding any other provision of this Order, SELLER shall be liable for all costs relating to the removal or replacement of Counterfeit Goods, including without limitation PURCHASER’s or PURCHASER’s customer’s costs of removing such Counterfeit Goods, reinserting genuine Goods, and any testing necessitated by the reinstallation of any Goods after Counterfeit Goods have been exchanged. PURCHASER reserves the right to turn over suspected Counterfeit Goods to U.S. Governmental authorities for investigation and reserves the right to withhold payment for the suspect items pending the results of the investigation. The remedies available under this Article are in addition to any other remedies PURCHASER may have available to it in law or in equity, or in any other provisions in this Order.
In the event PURCHASER suspects that SELLER may have provided Counterfeit Goods under any Order, PURCHASER shall immediately notify SELLER in writing, and provide sufficient detail to enable SELLER to promptly initiate its own internal investigation. SELLER will cooperate fully with any investigation of Counterfeit Goods conducted by PURCHASER and shall promptly provide all documentation and other information reasonably requested by PURCHASER.
SELLER shall flow the requirements of this Article to its subcontractors and suppliers at any tier for the performance under any Order.
- DEFENSE PRIORITIES AND ALLOCATIONS SYSTEM REGULATION – The Order may contain rated order quantities certified for national defense use, and in such instances, SELLER is required to follow all the provisions of the Defense Priorities and Allocations System regulation (15 CFR part 700) only as it pertains to the rated quantities.
- ANTI-BRIBERY. SELLER and its lower tier subcontractors have not directly or indirectly paid, or offered or agreed to pay political contributions, fees, or commission, whether in cash or in kind, with respect to this Order or the solicitation of this Order including all purchase orders issued to date to the SELLER in furtherance of the ORDER or solicitation of the ORDER.
- TERMINATION – PURCHASER may terminate this Order immediately by written notice to SELLER without liability or further obligation hereunder if SELLER breaches any provision, term or condition of the Order (or PURCHASER reasonably anticipates such breach) and SELLER shall be liable for all damages, losses and liability that PURCHASER incurs directly or indirectly resulting from SELLER’s breach, including, without limitation, attorney’s fees.
- FLOWDOWN – SELLER shall include the substance of all clauses in this Order in its subcontracts issued at all tiers pursuant to this order.
- MISCELLANEOUS – SELLER is an independent contractor and not PURCHASER’S employee, agent, partner, or joint ventures. PURCHASER’S remedies herein are cumulative and in addition to any other or further remedies available to it at law or equity. In the event any provision of an Order is found to be invalid or unenforceable, the parties hereby agree that the court shall enforce such provision to the extent permitted by law and, to the extent such provision is not enforceable, shall enforce the remainder of an Order as if such provision were not included in the Order. All Orders will be interpreted and enforced under the laws of the State of Rhode Island, without regard to its conflicts of law provisions. The state and federal courts in Providence County, Rhode Island will have exclusive jurisdiction to resolve any dispute related to this Order unless PURCHASER, in its sole discretion, brings a claim against SELLER in another court of competent SELLER consents to the jurisdiction of such courts and agrees to appear in any such action upon written notice thereof. In no event will the provisions of the U.N. Convention on the International Sale of Goods apply to this Order.
- RECORD RETENTION – The Supplier shall retain quality records for a time period specified by the PURCHASER’s contract or related reference documents. Upon request, the Supplier shall be capable of retrieving and delivering required records to PURCHASER within forty-eight hours from time of request by PURCHASER unless otherwise specified. The Supplier shall maintain all records that provide objective evidence of compliance to contract requirements for a minimum of fifteen (15) years after the last delivery of products and/or services on the contract. Prior to discarding, transferring to another organization, or destruction of such records, the Supplier shall notify the Ferguson Buyer in writing and give Ferguson the opportunity to gain possession of the records. These requirements are also applicable to records generated by Supplier’s sub-tier sources.
- DISTRIBUTORS – The technical and quality requirements of the purchase order apply to you (as the distributor) and the manufacturer of the product or material. As a distributor you are responsible for assuring that requirements are satisfied.
- RELEASE OF PRODUCTS AND SERVICES – When allowed on contract SELLER shall inspect and/or test as applicable, all characteristics defined by the purchase order, applicable drawing specifications, pertinent to the work that the SELLER is responsible for performing.
- CHANGE WITHIN THE ORGANIZATION – The SELLER shall notify the PURCHASER if changes to processes, products, or services, including changes to their external providers or location of manufacture or changes to their Quality Systems and obtain the PURCHASERS approval.
- NONCONFORMING PRODUCT – The SELLER shall notify the PURCHASURER of nonconforming processes, products, or services and obtain approval for their disposition.
- MRB AUTHORITY – Material Review Board Authority is NOT authorized on any purchase order or contract.
- INSPECTION SYSTEMS – The SELLER shall maintain a system the complies with ISO9001, or AS9100, or as acceptable to the PURCHASER.
- EXTERNAL PROVIDERS – The SELLER must inform the PURCHASER prior to the selection and/or use of external providers, including process sources.
- The SELLER shall ensure their organization is aware of their contribution to product or service conformity; their contribution to product safety; and the importance of engaging in ethical behavior.