STANDARD TERMS & CONDITIONS OF PURCHASE
(revised June 2021)
These MTEA Standard Terms & Conditions of Purchase, shall apply to, and be incorporated by reference into, any Order (as defined below) issued to “Supplier” (as identified in the Order) by Mitsubishi Turbocharger and Engine America, Inc. (“Buyer”). Together with the Order, these MTEA Standard Terms & Conditions of Purchase shall constitute the entire agreement between Buyer and Supplier (this “Agreement”).
- Acceptance of Orders
Supplier’s (i) full or partial performance under, or indication thereof, or (ii) acknowledgement of an Order, is acceptance of the Order and all terms and conditions set forth in the Order and incorporation into such Order of all terms and conditions set forth in this Agreement. Any terms and conditions set forth in Supplier’s acceptance or in any acknowledgment, invoice, or other form of Supplier that add to, vary from, or conflict with the terms hereof are hereby rejected.
- Certain Definitions
“Affiliate” means, with respect to any entity, any other entity that directly or indirectly controls, is controlled by or under common control with such entity.
“CARB” means the California Air Resources Board.
“Delivery Date” means the date of delivery for Goods and Services as specified in an Order and/or by the Delivery System.
“Delivery System” means Buyer’s computer-based, web-enabled delivery scheduling system.
“EPA” means the Environmental Protection Agency of the United States of America.
“Goods” means goods, parts, supplies, software, drawings, data, reports, manuals, other specified documentation, or items that are required to be delivered pursuant to, or in connection with, an Order, and, where the context requires, such Services as are necessary and incidental to the delivery of Goods under any Order. For clarity, changes made by Buyer to the part numbers and/or other description of the Goods as a result of a change under the Changes clause of these Terms and Conditions will continue to be Goods.
“Intellectual Property” means all inventions, patents, software, copyrights, mask works, industrial property rights, trademarks, trade secrets, know-how, proprietary information and rights and information of a similar nature. Such information includes, without limitation, designs, processes, drawings, prints, specifications, reports, data, technical information, and instructions.
“Order” means a paper or electronic document sent by Buyer to Supplier, or an entry on a Buyer web site, to initiate the ordering of Goods or Services, such as a purchase order, a scheduling agreement, or other authorization, and including, without limitation, change notices, supplements or modifications thereto, and any Specifications attached thereto or referenced therein.
“Party” or “Parties” means Buyer and/or Supplier, individually or collectively, as the context requires.
“Services” means any effort performed by Supplier pursuant to the Order, including any design, engineering, installation, repair, and maintenance.
“Specifications” means all requirements with which Goods and Services and performance hereunder must comply, including, without limitation, drawings, instructions and standards, on a Buyer web site or elsewhere, as such requirements are specified and/or referenced in Orders, as such requirements are modified from time to time by Buyer.
- Supplier shall use the Delivery System and electronic data exchange billing and invoicing systems (collectively, “Buyer Systems”) specified by Buyer.
- The delivery information in the Buyer Systems shall establish the Delivery Dates for the Goods and/or Services. Supplier shall only ship in accordance with the rules established by the Buyer Systems, and shall use the bar codes and other documentation generated by the Delivery System.
- Time is of the essence in Supplier’s performance of an Order, and Supplier shall deliver Goods and perform Services by the Delivery Date.
- Seller shall ship Goods to the location designated from time to time by Buyer. Buyer shall provide to Supplier invoicing, delivery terms, shipping, packing and waste reduction instructions through an attachment to, or printing on the face of, the Order, or incorporated into the Order by reference to a web site. In the absence of such instructions, the delivery terms for Goods shall be DAP (Incoterms 2010) at such location(s) as may be specified by Buyer in applicable Order. Title and risk of loss and damage shall pass to Buyer upon delivery as provided in the preceding sentence.
- Inspection, Acceptance, and Rejection of Goods
- For a period of ninety (90) days following Buyer’s receipt of Goods or completion of Services performed by the Supplier, Buyer shall be entitled to inspect such Goods or Services to ensure conformity with the Order (“Inspection Period”).
- During the Inspection Period, Buyer may, with respect to any Goods or Services that do not conform in one or more respects to an Order: (i) reject all or a portion of such nonconforming Goods or Services; or (ii) accept all or a portion of such nonconforming Goods or Services with a price reduction for the cost of repair or the diminution of value.
- Supplier shall be liable for Buyer’s actual costs, expenses and damages related to or arising from nonconforming Goods or Services, including without limitation, incremental labor costs, transportation costs, and all other resulting losses or corrective action costs incurred by Buyer.
- Supplier warrants to Buyer that all Goods shall be: (i) merchantable and fit for the purpose intended; (ii) new; (iii) free from defects in material and workmanship; (iv) free from defects in design if the design is not provided by Buyer; (v) designed and manufactured in strict accordance with any Specifications and other requirements of the Order; (vi) free from liens or encumbrances on title; and (vii) compliant with all applicable laws and regulations, including those standards imposed by the EPA and CARB (collectively, the “Product Warranty”).
- Buyer may require Supplier to promptly repair or replace, at Buyer’s option, any Goods that breach the Product Warranty. Buyer may return ship the Goods on the fastest available commercial carrier at Supplier’s expense and risk of loss or damage. Goods returned to Buyer hereunder shall be shipped at Supplier’s expense and risk of loss and shall be accompanied by a notice stating whether they are new replacements or repaired originals, and shall continue to be covered under this Product Warranty. Supplier shall conduct intake, review, analysis and any other activity required to evaluate whether the returned Goods are covered by the Warranty at no expense to Buyer.
- Notwithstanding any other provision, in addition to the foregoing, Supplier shall be liable for Buyer’s actual costs, expenses, and damages related to or arising from Goods not conforming to the Product Warranty, including, without limitation, labor and other costs related to transportation of Goods, expediting, removal, disassembly, failure analysis, fault isolation, assembly, reinstallation, re-inspection, retrofit, and any and all other such corrective action costs incurred by Buyer.
- Supplier warrants that the Services will be performed in accordance with current, sound and generally accepted industry practices and in a workmanlike manner by appropriately licensed personnel who are trained and experienced in the appropriate fields (the “Service Warranty”).
- Supplier agrees that should any of the Services not comply with the Service Warranty, in Buyer’s sole judgment acting reasonably, Supplier shall re-perform all Services originally undertaken by Supplier and/or necessary to correct such defective Services, at no additional cost to Buyer. In the event re-performance does not remedy Supplier’s unsatisfactory performance, Buyer reserves the right to procure substitute services from another source or sources and to charge Supplier (directly or via set-off) with the costs thereof. Buyer also reserves the right to charge Supplier for costs, expenses, and damages occasioned by Contractor’s breach of the Service Warranty.
- Emissions Compliance Commitment
If during the Term, any standards or regulations imposed by any governmental authority of competent jurisdiction, including without limitation the EPA and CARB, are updated, revised, or replaced, Supplier shall promptly inform Buyer of the same, and shall: (a) incorporate into any Goods ordered thereafter such changes as may be necessary to ensure compliance by the Goods with such standards and regulations, and (b) promptly provide upgrade kits to Buyer at no cost that will enable Buyer and its assignees to upgrade Goods already installed to ensure compliance by the Goods with such standards and regulations.
- General Indemnification
Supplier shall indemnify, defend, and save and hold harmless Buyer, Buyer’s insurers and Buyer’s Affiliates and their respective employees, agents, officers and directors for and from all suits, claims, judgments, awards, losses, damages, costs or expenses (including, without limitation, attorneys’ fees) relating to, arising out of, or caused by the performance hereunder, any act or omission of Supplier or any Goods or Services. Supplier’s indemnification obligation hereunder covers, without limitation, injuries, sickness, diseases (including, without limitation, occupational disease whenever occurring), or death of Supplier employees.
- All payments, prices, fixed or otherwise, sums, payments, fees and monetary amounts set forth in the Order or this Agreement are exclusive of any and all sales and use taxes, value added taxes, goods and services taxes, taxes levied upon importation (such as customs duties and excises), and any other taxes (collectively, “Taxes”).
- When invoicing, Supplier shall: (i) include amounts of Taxes, or specific fees Supplier is required by applicable law to add-on to the sales price and collect from Buyer or otherwise is legally due from Buyer, and (ii) separately state each of the Taxes.
- Supplier shall be responsible for payment of all Taxes, and for the fulfillment of Supplier’s obligations under applicable law with respect to collecting and remitting Taxes collected from Buyer under this Agreement or any Order, to the proper tax authority. Supplier shall pay any penalties, fees or interest charges imposed by a tax authority or other authority resulting from the non-payment of Taxes collected by Supplier. Supplier shall also pay any Taxes arising out of its willful misconduct or negligence for which Buyer becomes liable.
- Buyer may unilaterally make changes within the general scope of an Order, including, without limitation, changes in whole or part, to: (i) shipping, waste reduction or packing instructions, (ii) place of delivery, (iii) any designs and drawings, (iv) the statement of work, (v) the method or manner of performance, and/or (vi) quality requirements (“Change(s)”); provided that any Order terms that incorporate flexibility for variations and/or modifications do not constitute a “Change”. Supplier shall perform any Changes ordered by Buyer.
- If a Change causes an increase or decrease in the cost of, or the time required for, performance, an equitable adjustment shall be made in price or delivery schedule or both (“Adjustment Claim”), and Buyer shall modify the Order accordingly; provided that Supplier delivers to Buyer an Adjustment Claim in writing in the form of a complete change proposal, fully supported by factual information, to Buyer no later than fifteen (15) days after Supplier’s notification of the Change.
- Termination for Default
- Buyer may, by written notice, terminate an Order or any portion thereof, for default without any liability or obligation whatsoever to Supplier for the portion terminated, in the following circumstances: (i) Supplier fails to perform any obligation hereunder, including, without limitation, a delivery obligation; (ii) when Buyer has reasonable grounds for insecurity, and Supplier fails to provide adequate assurances of performance within ten (10) days following Buyer’s demand therefor; or, (iii) should Supplier (a) become insolvent, (b) become unable to pay its debts as they mature, (c) make a general assignment for the benefit of creditors, (d) have a receiver appointed for the whole or any substantial part of its assets, or (e) become in any way the subject of a bankruptcy petition.
- Buyer shall have no liability in relation to those Goods or Services terminated for Supplier’s default. Supplier shall be liable to Buyer for any and all expenses, costs, and damages including, without limitation, increased re-procurement costs, requalification costs, and other non-recurring costs, except in the circumstance of any failure or delay constituting an Excusable Delay.
- Termination for Convenience; Stop Work Order
- Buyer may, at any time, terminate all or part of an Order for its convenience upon written notice to Supplier.
- Upon such termination, in accordance with Buyer’s written direction, Supplier shall immediately: (i) cease work and place no further subcontracts or orders for materials, services, or facilities, except as necessary to complete the continued portion of the Order; (ii) prepare and submit to Buyer an itemization of all completed and partially completed Goods and/or Services; (iii) deliver to Buyer any and all Goods completed up to the date of termination at the pre-termination Order price; and (iv) if requested by Buyer, deliver any work-in-process.
- In the event Buyer terminates in accordance with this Section 12 after performance has commenced, Buyer shall compensate Supplier only for the actual and reasonable work-in-process costs incurred by Supplier on Goods or Services already provided. Supplier shall use reasonable efforts to mitigate its own and Buyer’s liability under this Section 12. In order to receive compensation, Supplier’s termination claim must be submitted within ninety (90) days from the effective date of the termination.
- Buyer shall not be liable to Supplier for costs or damages other than as described in Section 12.3, and in no event for lost or anticipated profits, or unabsorbed indirect costs or overhead, or for any amount in excess of the price allocated to the portion of the Order terminated.
- Buyer may, from time to time, require Supplier to stop all or any portion of the work called for by the Order for a period of up to 120 days (“Stop Work Period”) at each such time. Upon receipt of written notice (“Stop Work Order”) detailing the length and scope of the Stop Work Period, Supplier shall immediately comply with its terms at no charge. Within the Stop Work Period, Buyer shall either: (i) cancel the Stop Work Order and Supplier shall thereupon resume work; or (ii) terminate the work covered by the Stop Work Order, for default or convenience, as the context requires, in accordance with the provisions of the Order.
- Intellectual Property Indemnification
- Supplier shall indemnify, defend, and save and hold harmless Buyer, its Affiliates, subsidiaries, agents, directors, officers, and employees, and each subsequent purchaser or user, from any losses, costs, damages, and liabilities, including, without limitation, any attorney’s fees, court costs and fines, arising from any potential or actual claim, suit, injunction, action, proceeding, or investigation alleging infringement or violation of any Intellectual Property rights or license, related to the manufacture, use or sale of any Goods or Services delivered or performed in connection with the Order (“Claim”).
- Supplier shall, upon written notice from Buyer of a Claim, promptly assume and diligently conduct the entire defense of a Claim at its own expense. Insofar as Buyer’s interests are affected, Buyer shall have the right, at its own expense and without releasing any obligation of Supplier, to participate and intervene in a Claim. Buyer shall have the right to reasonably reject counsel selected by Supplier. Supplier shall not enter into any settlement without Buyer’s prior written consent, which shall not be unreasonably withheld.
- Buyer may supersede Supplier in the defense of any Claim, and assume and conduct the defense at Buyer’s sole discretion. In such an event, Supplier shall be released from any obligation to pay for attorneys’ fees and court costs, but not settlement or damages, and any such release is expressly conditioned on Supplier’s complete cooperation with Buyer in Buyer’s defense of such Claim at Buyer’s expense. Buyer shall not enter into any settlement without Supplier’s prior written consent, which shall not be unreasonably withheld.
- If the manufacture, use or sale of the Goods is enjoined by a court, if delivery is precluded by a government entity, or if Supplier refuses to supply Goods to avoid a potential third party claim, Supplier shall avoid any disruption to Buyer and shall (i) secure for Buyer the right to use or sell such Goods; (ii) modify or replace such Goods with equivalent non-infringing Goods; or (iii) provide such other solution acceptable to Buyer. Supplier shall reimburse Buyer for Buyer’s costs incurred in obtaining all internal and external approvals, qualifications, certifications, and the like, necessary for making, using and selling alternate non-infringing Goods. Supplier shall refund to Buyer the purchase price of any such Goods that Buyer is prohibited from using or selling.
- Proprietary Information
- “Proprietary Information” means all information, knowledge or data (including, without limitation, financial, business, and product strategy information; product specifications; product designs; procedures; studies; tests; and reports) in written, electronic, tangible, oral, visual or other form, (i) disclosed by, or obtained from, Buyer or (ii) conceived, created, acquired, or first reduced to practice in connection with the Order. If Buyer furnishes sample products, equipment, or other objects or material to Supplier, the items so received shall be used and the information obtained from said items shall be treated as if they were Proprietary Information disclosed in connection with the Order.
- Unless Supplier has received the Buyer’s express written consent to the contrary, Supplier shall (i) use the Proprietary Information solely for the purposes of the Order, and not for any other purpose (including, without limitation, designing, manufacturing, selling, servicing or repairing equipment for entities other than Buyer; providing services to entities other than Buyer; or obtaining any government or third party approvals to do any of the foregoing); (ii) safeguard the Proprietary Information to prevent its disclosure to or use by third parties; (iii) not disclose the Proprietary Information to any third party; and (iv) not reverse engineer, disassemble, or decompile the Proprietary Information.
- Supplier may disclose the Proprietary Information to only officers, directors, employees, contract workers, consultants, agents, affiliates or subcontractors of Supplier who have a need to know such Proprietary Information for the purposes of the Order and who have executed a written agreement with Supplier obligating such entity or person to treat such information in a manner consistent with the terms of this Section 14.
- An Order shall not restrict Supplier from using or disclosing any information that, as proven by written contemporaneous records kept in the ordinary course of business: (i) is or may hereafter be in the public domain through no improper act or omission of Supplier or a third party; (ii) is received by the Supplier without restriction as to disclosure by Supplier from a third party having a right to disclose it; (iii) was known to Supplier on a non-confidential basis prior to the disclosure by Buyer; or (iv) was independently developed by employees of Supplier who did not have access to any of Buyer’s Proprietary Information.
- If Proprietary Information is required to be disclosed pursuant to judicial process, Supplier shall promptly provide notice of such process to Buyer and, upon request, shall fully cooperate with Buyer in seeking a protective order or otherwise contesting such a disclosure. Disclosure of such requested Proprietary Information shall not be deemed a breach of the Order provided that the obligations of this Section 14 are satisfied by Supplier.
- Supplier shall not make or authorize any news release, advertisement, or other disclosure that (i) relates to the Order or the relationship between Buyer and Supplier, (ii) denies or confirms the existence of the Order or (iii) makes use of Buyer’s name or logo, in each case without the prior written consent of Buyer.
- Intellectual Property Rights
- “Background Intellectual Property” means all Intellectual Property other than Foreground Intellectual Property. “Foreground Intellectual Property” means all Intellectual Property and tangible work product conceived, created, acquired, or first reduced to practice in connection with the Order.
- Each Party retains its existing rights in Background Intellectual Property.
- Buyer shall own all Foreground Intellectual Property. Supplier shall disclose to Buyer all Foreground Intellectual Property. If not expressly required to be delivered in the Order, Supplier shall deliver to Buyer all Foreground Intellectual Property upon written request from Buyer. Supplier hereby irrevocably assigns to Buyer all right, title and interest to all Foreground Intellectual Property. Supplier agrees to do all things reasonably necessary to enable Buyer to secure and perfect Buyer’s Foreground Intellectual Property rights, including, without limitation, executing specific assignments of title in Foreground Intellectual Property by Supplier to Buyer and cooperating with Buyer at Buyer’s expense to defend and enforce Buyer’s rights in any such Foreground Intellectual Property. All Foreground Intellectual Property assigned to Buyer pursuant to the Order shall be considered Buyer’s Proprietary Information (defined hereinafter). Supplier agrees that, for any works of authorship created by Supplier or any employees or any others used by Supplier in the course of the Order, those works that come under one of the categories of “Works Made for Hire” in 17 U.S.C.§101 shall be considered “Works Made for Hire”. For any works of authorship that do not come under such categories, Supplier, warranting that it has the right to do so, hereby assigns all right, title, and interest to any copyright in such works to Buyer and will execute, or cause to be executed at Buyer’s expense, any documents required to establish Buyer’s ownership of such copyright.
- Supplier represents and warrants that Supplier has sufficient rights in all Goods, Services, and Intellectual Property and other items that Supplier uses or transfers to Buyer in connection with the Order to allow Supplier to lawfully comply with the Order.
- Supplier hereby grants to Buyer and Buyer’s Affiliates a worldwide, non-exclusive, perpetual, fully-paid, irrevocable, transferable license to Background Intellectual Property (i) to use, sell, offer for sale, import, export, copy, adapt, embed, modify, make derivative works, make and have made Goods and Services, and (ii) to enable Buyer to practice the Foreground Intellectual Property.
- Supplier hereby irrevocably waives all moral rights to the extent permissible by law, all rights of privacy and publicity, and the like, in all Goods provided to Buyer and in all activities in connection with the Order.
- Supplier represents and warrants that Supplier shall not provide, in the performance of the Order, any software, (including, without limitation, free software, open source software, freeware, general public license-governed software, or the like), in any form that is subject to any obligations or conditions that could reasonably or arguably could provide a legal right to any third party to access such software and/or source code, or that could otherwise impose any limitation or condition on Buyer’s use, reproduction, modification, distribution or conveyance of such software.
- Except as expressly authorized herein, nothing in the Order shall be construed as Buyer granting Supplier a license in or any right to use any of Buyer’s Intellectual Property other than in the performance of work under the Order.
- Without limiting any of Supplier’s obligations hereunder, Supplier agrees to secure and carry as a minimum the following insurance with respect to all work to be performed under an Order for the duration of the Order: (i) Workers’ Compensation Insurance in an amount sufficient by virtue of the laws of the U.S., foreign country, state, or other governmental subdivision in which the work or any portion of the work is performed and Employer’s Liability Insurance in the minimum amount of $1,000,000 for any one occurrence; (ii) Commercial General Liability Insurance including, without limitation, Premises Liability and contractual Liability, in which the limit of liability for property damage and bodily injuries, including, without limitation, accidental death, shall be at a minimum, a combined single limit of $5,000,000 for any one occurrence; (iii) if Supplier vehicles are used on Buyer’s premises and/or used to accomplish work under the Order or otherwise on behalf of Buyer, Automobile Liability Insurance in which the limit of liability for property damage and bodily injuries, including, without limitation, accidental death, shall be a combined single limit of $1,000,000 for any one occurrence; (iv) if Supplier or its subcontractors have Buyer’s materials or equipment in its care, custody or control, Supplier shall have and maintain All-Risk Property Insurance in an amount sufficient to meet or exceed the value of such material; and (v) if Supplier is performing professional services on behalf of Buyer, Supplier shall maintain Professional Liability Insurance with a limit of no less than $5,000,000.
- All such insurance shall be issued by companies authorized to do business under the laws of each state or jurisdiction in which all or part of the Services are to be performed, and must have an AM Best financial rating of A- or better or an equivalent rating as produced by another rating agency acceptable to Buyer.
- The insurance policies required under this Section 16 shall be in form satisfactory to Buyer, and shall contain a provision prohibiting cancellation or material change except upon at least thirty (30) days’ prior notice to Buyer. All such insurance policies will be primary in the event of a loss arising out of the Supplier’s performance of work and provide that where there is more than one insured the policy will operate, except for the limits of liability, as if there were a separate policy covering each insured and shall operate without right of contribution from any other insurance carrier by Buyer. Certificates evidencing such insurance and endorsements naming MTEA and, if Buyer is not MTEA, Buyer as an additional insured or, in the case of All Risk Property Insurance, naming MTEA and, if Buyer is not MTEA, Buyer as a loss payee, shall be filed with Buyer upon execution of the Order and before commencement of any work hereunder, and within thirty (30) days after any renewals or changes to such policies are issued. To the extent permitted by law, Supplier and its insurer(s) agree that subrogation rights against MTEA and, if Buyer is not MTEA, Buyer are hereby waived; such waiver shall be reflected on the insurance certificate. Supplier shall, if requested by Buyer, advise Buyer of the amount of available policy limits and the amounts of any self-insured retention.
- Standards of Business Conduct
- Supplier shall adopt and comply with a policy statement or code of conduct regarding business ethics (“Code”) that is consistent with the Mitsubishi Heavy Industries Global Code of Conduct. The Code shall be suitable for Supplier’s business and as a minimum will require compliance with all applicable laws and regulations. The Code shall assure a safe and healthy work environment, prohibit the use of child or forced labor, provide for the protection of the environment and minimization of waste, emissions, energy consumption and the use of materials of concern and prohibit engagement in corrupt practices (e.g. facilitating, offering or paying any bribe).
- Supplier represents and warrants that it has not and shall not offer or give anything of value (in the form of entertainment, gifts, or otherwise) to Buyer’s employees or representatives for the purpose of obtaining the Order or favorable treatment under the Order. Supplier represents and warrants that it has not made, nor will it make, or offer to make any political contributions, or pay, or offer to pay any fees or commissions in connection with the Order.
- Compliance with Laws
- Supplier shall comply with all applicable national, state, provincial, and local laws, ordinances, rules, and regulations applicable to the performance of an Order or supply of the Goods, including: (i) the manufacture or provisioning of Goods and/or Services, (ii) the shipping of Goods, and (iii) the configuration or content of Goods for the use intended by Buyer.
- Without limiting the foregoing, Supplier shall comply with the most current export control and sanctions laws, regulations, and orders applicable at the time of the export, re-export, transfer, disclosure or provision of Goods, software, technology or Services including, without limitation, the (i) Export Administration Regulations (“EAR”) administered by the Bureau of Industry and Security, U.S. Department of Commerce, 15 C.F.R. parts 730-774; (ii) International Traffic in Arms Regulations (“ITAR”) administered by the Directorate of Defense Trade Controls, U.S. Department of State, 22 C.F.R. parts 120-130; (iii) Foreign Assets Control Regulations and associated Executive Orders administered by the Office of Foreign Assets Control, U.S. Department of the Treasury, 31 C.F.R. parts 500-598; and (iv) laws and regulations of other countries.
- Without limiting the foregoing, Supplier shall comply with all applicable federal, state and local laws, statutes, ordinances, codes, rules, regulations, standards, directives, interpretations, and conditions of approval, all legislative, administrative or judicial orders, decrees, requirements, rulings or judgments and all guidelines, permits, licenses, authorizations, approvals or entitlements or rules of common law that currently are in effect or that in the future may be enacted, adopted, issued, amended or modified, pertaining to the protection of the environment or human health or safety (“Environmental Laws”). At all times during its performance hereunder, Supplier shall be solely responsible and liable for the cleanup of all fuel spillage and leakage, and the removal, remediation, or cleanup of, and any other necessary response to any Hazardous Substances used or released by Supplier or its agents or subcontractors. Any claim for fines or costs assessed by any government entity for cleanup of Buyer’s property, or the removal, remediation, or cleanup of, and any other necessary response to Hazardous Substances used or released by Supplier or its agents or subcontractors during or in connection with its performance hereunder shall be paid by Supplier. For purposes hereof, “Hazardous Substances” means and includes any chemical, substance, material, object, condition, waste, living organism or combination thereof that is or may be hazardous to human health or safety or to the environment due to its radioactivity, ignitability, corrosivity, reactivity, explosivity, toxicity, carcinogenicity, mutagenicity, phytotoxicity, infectious or other harmful or potentially harmful properties or effects; and also includes without limitation petroleum hydrocarbons, including crude oil or any fraction thereof, asbestos, radon, polychlorinated biphenyls, methane and all substances that now or in the future may be defined as “Hazardous Substances”, “Hazardous Waste”, “Extremely Hazardous Waste”, Hazardous Material” or “Toxic Substances”, or any similar substances that are otherwise listed, defined or regulated in any manner pursuant to Environmental Law.
- Right to Inspect / Audit
- Supplier (which, for the purposes of this Section 19, includes Supplier’s suppliers) shall at any time, and after reasonable notice by Buyer, (i) grant to Buyer, Buyer’s customers and/or to any competent regulatory authority, unrestricted access to (or if requested by Buyer, provide to Buyer copies of) Supplier’s books and records related to the Good and Services (including, without limitation, agreements and technical inspection and quality records, but excluding financial books and records), wherever such books and records may be located (including, without limitation, third-party repositories), and (ii) provide Buyer, Buyer’s customers and/or any such authority the right to access, and to perform any type of inspection, test, audit or investigation at Supplier’s premises, including, without limitation, manufacturing and test locations, in each case for the purpose of enabling Buyer to verify compliance with the requirements set forth in the Order or for any other purpose indicated by Buyer’s customers and/or said authority in connection with the design, development, certification, manufacture, sale, use and/or support of the Goods. Supplier and its subcontractors shall furnish all reasonable facilities and assistance for the safe performance of the inspection, test, audit and/or investigation.
- Supplier shall maintain complete inspection records for all Goods and Services which shall be available to Buyer during performance of an Order and until the last to occur of: (i) four (4) years after final payment, (ii) final resolution of any dispute involving the Goods and/or Services, (iii) the latest time required by an Order, (iv) the latest time required by applicable laws and regulations, or (v) as otherwise directed by Buyer.
- Any corrective action requested by Buyer, Buyer’s customers and/or any said authority following any such inspection, test, audit or investigation shall be implemented by Supplier at no cost.
- In addition to any other inspection or audit rights granted to Buyer hereunder, Buyer may inspect and audit, on reasonable notice, Supplier’s financial books and records if the Order: (i) is a time and material order, (ii) is a cost-based order, or (iii) provides for advance or progress payments based on costs incurred by Supplier.
- Applicable Law and Forum
The validity, construction, and performance of any Order and this Agreement shall be governed by and interpreted in accordance with the laws of the State of Illinois, U.S.A., with the exception of conflicts of law rules that would result in the application of the law of any other jurisdiction. The United Nations Convention on Contracts for the International Sale of Goods shall not apply. Supplier agrees to the exclusive jurisdiction of the state and federal courts of general jurisdiction of the State of Illinois, and agrees not to commence any suit or proceeding relating hereto except in such courts. Notwithstanding any other provisions of this Agreement, with respect to any breach of Section 14 or Section 15 above, Buyer shall be entitled to immediate, ex parte, injunctive relief from any court of competent jurisdiction and Supplier hereby waives any defense that harm is not imminent or that Buyer has an adequate remedy available at law.
- Dispute Resolution
- Except as provided below, prior to a Party initiating a formal legal proceeding relating to a dispute under an Order, that Party must provide the other with a written request for dispute resolution. Each Party shall, within five (5) calendar days after such written request is received, designate a representative who will be responsible for negotiating, in good faith, a resolution of the dispute. Should the representatives fail to reach agreement within thirty (30) calendar days of receipt of the request, senior-level manager of each Party shall attempt to resolve the issue within sixty (60) calendar days of receipt of such written request.
- Either Party may (i) resort to a formal legal proceeding for equitable relief at any time and (ii) institute litigation in order to avoid the expiration of any applicable limitations period or to preserve a superior position with respect to other creditors.
- Each Party shall continue performing its obligations under the Order pending resolution of the dispute. The dispute resolution procedures set forth herein do not supersede, delay or otherwise affect any rights of termination that are expressly set forth in this Agreement.
- Assignment. Any assignment by Supplier of an Order, in whole or in part, by operation of law or otherwise, without Buyer’s prior written consent shall be void.
- Setoff. Buyer and its Affiliates may withhold, deduct and/or set off all money due, or which may become due to Supplier arising out of Supplier’s performance under the Order or any other transaction with Buyer and its Affiliates.
- Partial Invalidity/Unenforceability. If in any provision of any Order or this Agreement shall be determined to be invalid or unenforceable under any applicable law by any competent court or arbitration tribunal, such provision shall be ineffective only to the extent of such prohibition or unenforceability. The remaining provisions shall be given effect in accordance with their terms. The provision declared invalid or unenforceable shall be deemed to be restated to reflect as nearly as possible the meaning and essence of such provision without rendering such amended provision invalid or unenforceable.
- No Waiver. No failure of any Party to exercise any right under, or to require compliance with, an Order, or knowledge of past performance at variance with the Order, shall constitute a waiver by such Party of its rights hereunder. No concession, latitude or waiver allowed by either Party to the other at any time shall be deemed a concession, latitude or waiver with respect to any rights unless and only to the extent expressly stated in writing, nor shall it prevent such Party from enforcing any rights in the future under similar circumstances.
- Delays. Whenever there is an actual delay or threat to delay the timely performance of an Order, Supplier shall immediately notify Buyer in writing of the probable length of any anticipated delay and take, and pay for, all activity to mitigate the potential impact of any such delay.
- Force Majeure. Supplier shall be liable for any failure or delay in performance in connection with an Order, except where such failure or delay results from causes that are, at one and the same time, unforeseeable, unavoidable, outside of its control and without its fault or negligence, provided Supplier gives Buyer, within three (3) days of Supplier’s learning of such cause, written notice to the effect that a failure or delay by Supplier will occur or has occurred (an “Excusable Delay”). If a failure or delay in performance is caused by an event affecting any of Supplier’s suppliers, such failure or delay shall not be excusable unless such event is an Excusable Delay as defined above and the good or service to be provided by such supplier is not obtainable by Supplier from other sources in time for timely delivery of the Goods to Buyer. Buyer shall be excused for any failure or delay in performance due to any cause beyond its reasonable control.
- Notices. Any notice from one Party to the other under any Order shall be in writing and either: (a) delivered personally; (b) sent by certified mail, return receipt requested; (c) sent by a recognized overnight mail or courier service with delivery receipt requested; (d) sent by e-mail with acknowledgement of receipt by recipient (provided that an out-of-office notice shall not constitute such acknowledgment); or (e) sent by facsimile transfer, in each case utilizing the contact information set forth in the Order.
- Relationship of the Parties. The relationship between Supplier and Buyer will be that of independent contractors and not that of principal and agent, nor that of employer and employee, nor that of legal partners. Neither Party will represent itself as the agent or legal partner of the other Party nor perform any action that might result in other persons believing that it has authority to contract in any way to enter into commitments on behalf of the other.
- Survival. Notwithstanding any termination or expiration of this Agreement, the provisions set forth in Sections 3, 6, 8, 11, 12, 13, 14, 15, 20, 21, and 22 above shall survive and remain binding upon the Parties.