Standard Purchase Order Terms and Conditions

  1. Applicability.
    • This purchase order is an offer by Power Solutions International, Inc., Professional Power Products, Inc. and/or their respective affiliates and subsidiaries (collectively, “Buyer”) for the purchase of the goods specified on the face of this purchase order (the “Goods”) from the party to whom the purchase order is addressed (“Seller”) in accordance with and subject to these terms and conditions (the “Terms”; together with the terms and conditions on the face of the purchase order, the “Order”). This Order, together with any documents incorporated herein by reference and a separate written supply agreement, if applicable, between the parties, constitutes the sole and entire agreement of the parties with respect to the Order, and supersedes all prior or contemporaneous understandings, agreements, negotiations, representations and warranties, and communications, both written and oral, with respect to the subject matter of the Order. The Order expressly limits Seller’s acceptance to the terms of the Order. If any “click-wrap,” “click-through,” “browse-wrap,” or “shrink- wrap” terms are included or embedded with the goods or services, including software, those conditions will be of no force and these Terms will prevail. These Terms prevail over any terms or conditions contained in any other documentation and expressly exclude, modify or contradict any of Seller’s general terms and conditions of sale or any other document issued by Seller in connection with this Order.
    • These Terms also apply to any repaired or replacement Goods provided by Seller hereunder.
    • Buyer is not obligated to any minimum purchase or future purchase obligations under this Order.
  2. Acceptance. This Order is not binding on Buyer until Seller accepts the Order in writing or starts to perform in accordance with the Order. If Seller does not accept the Order in writing or provide written notice that it has commenced performance within 24 hours of Seller’s receipt of the Order, the Order shall be deemed accepted.
  3. Prices. All prices are firm. No additional charges of any kind will be allowed unless specifically agreed in writing by Buyer in an Order revision.
  4. Delivery Date. Seller shall deliver the Goods in the quantities and on the date(s) specified in this Order or as otherwise agreed in writing by the parties (the “Delivery Date”). Timely delivery of the Goods is of the essence. If Seller fails to deliver the Goods in full on the Delivery Date, Buyer may terminate the Order immediately by providing written notice to Seller and Seller shall indemnify Buyer against any losses, claims, damages, and reasonable costs and expenses directly attributable to Seller’s failure to deliver the Goods on the Delivery Date.
  5. Duty Drawback. Seller assigns to Buyer all rights which Seller or its agents may obtain, or have the right to obtain, for the drawback of any customs or duties paid on importation of the Goods. Seller agrees to execute and deliver any documents and to provide other information, as may be required to substantiate Buyer’s claim for any drawback, and to take other actions in connection with such claim as Buyer may reasonably request.
  6. Delivery Location. All Goods shall be delivered to the address specified in this Order (the “Delivery Location”) during Buyer’s normal business hours or as otherwise instructed by Buyer.
  7. Shipping Terms. Unless otherwise agreed by Buyer, delivery shall be made DDP Delivery Location, Incoterms® 2020. Seller shall give written notice of shipment to Buyer when the Goods are delivered to a carrier for transportation. Seller shall provide Buyer all shipping documents, including the commercial invoice, packing list, and any other documents necessary to release the Goods to Buyer pursuant to the Order, after Seller delivers the Goods to the transportation carrier. The Order number must appear on all shipping documents, shipping labels, invoices, correspondence and any other documents pertaining to the Order.
  8. Title and Risk of Loss. Title passes to Buyer upon delivery of the Goods to the Delivery Location. Seller bears all risk of loss or damage to the Goods until delivery of the Goods to the Delivery Location.
  9. Packaging. All goods shall be packed for shipment according to Buyer’s instructions or, if there are no instructions, in a manner sufficient to ensure that the Goods are delivered in undamaged condition. Seller must provide Buyer prior written notice if it requires Buyer to return any packaging material. Any return of such packaging material shall be made at Seller’s expense.
  10. Amendment and Modification. No change to this Order is binding upon Buyer unless it is in writing, specifically states that it amends this Order and is agreed and signed by an authorized representative of Buyer.
  11. Inspection and Rejection of Nonconforming Goods. The Buyer has the right to inspect the Goods on or after the Delivery Date. Buyer, at its sole option, may inspect all or a sample of the Goods, and may reject all or any portion of the Goods if it determines the Goods are nonconforming or defective. If Buyer rejects any portion of the Goods, Buyer has the right, effective upon written notice to Seller, to: (a) rescind the Order in its entirety; (b) accept the Goods at a reasonably reduced price; or (c) reject the Goods and require replacement of the rejected Goods. If Buyer requires replacement of the Goods, Seller shall, at its expense, within 10 calendar days replace the nonconforming Goods and pay for all related expenses, including, but not limited to, transportation charges for the return of the defective goods and the delivery of replacement Goods. If Seller fails to timely deliver replacement Goods, Buyer may replace them with goods from a third party and charge Seller the cost thereof and terminate this Order for cause pursuant to Section 23. Any inspection or other action by Buyer under this Section shall not reduce or otherwise affect Seller’s obligations under the Order, and Buyer shall have the right to conduct further inspections after Seller has carried out its remedial actions.
  12. Price. The price of the Goods is the price stated in the Order (the “Price”). If no price is included in the Order, the Price shall be, if applicable, the lower of (1) the last quoted or charged by Seller for the same goods and (2) the price set out in Seller’s published price list in force as of the date of the Order. Unless otherwise specified in the Order, the Price includes all packaging, transportation costs to the Delivery Location, insurance, customs duties and fees and applicable taxes, including, but not limited to, all sales, use or excise taxes. No increase in the Price is effective, whether due to increased material, labor, or transportation costs or change in laws and regulations or otherwise, without the prior written consent of Buyer.
  13. Most Favored Customer. Seller represents and warrants that the price for the Goods is the lowest price charged by Seller to any of its external buyers for similar volumes of similar Goods. If Seller charges any other buyer a lower price, Seller must apply that price to all Goods under this Order. If Seller fails to meet the lower price, Buyer, at its option, may terminate this Order without liability pursuant to Section 23.
  14. Payment Terms. Seller shall issue an invoice to Buyer on or any time after the completion of delivery and only in accordance with the Terms. Buyer shall pay all properly invoiced amounts due to Seller within 90 days after Buyer’s receipt of such invoice, except for any amounts disputed by Buyer in good faith. All payments hereunder must be in US dollars. In the event of a payment dispute, Buyer shall deliver a written statement to Seller no later than the date payment is due on the disputed invoice listing all disputed items and providing a reasonably detailed description of each disputed item. Amounts not so disputed are deemed accepted and must be paid, notwithstanding disputes on other items, within the period set forth in this Section 14. The parties shall seek to resolve all such disputes expeditiously and in good faith. Seller shall continue performing its obligations under the Order notwithstanding any such dispute.
  15. Set-off. Without prejudice to any other right or remedy it may have, Buyer reserves the right to set off at any time any amount owing to it by Seller or a Seller Affiliate to Buyer or a Buyer Affiliate, on this or any other order or agreement. “Affiliate” shall for the purposes of this Order mean, with respect to either party, any entity, including without limitation, any individual, corporation, company, partnership, joint venture, limited liability company or group, that directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with such party.
  16. Changes.
    • Buyer may at any time make changes within the general scope of this Order. If any changes cause a material increase or decrease in the cost and/or time required for the performance of any work under this Order, an equitable adjustment shall be mutually agreed in writing and reflected in the Order price and/or delivery schedule. Any Seller claim for adjustment under this clause may only include reasonable, direct and documented costs that will necessarily be incurred as a direct result of the change. Notwithstanding anything contrary in this Order, in no event shall Buyer be responsible for Seller’s loss of profit or for any indirect, special, punitive and/or consequential damages.
    • Seller shall notify Buyer in writing in advance of any and all: (a) changes to the Goods and/or services, their specifications and/or composition; (b) material process changes; (c) material plant and/or equipment/tooling changes or moves; (d) transfer of any work hereunder to another site; and/or (e) material changes to its procurement of goods/services in connection with the Order, and no such change shall occur until Buyer has had the opportunity to conduct such audits, surveys and/or testing necessary to determine the impact of such change on the Goods and/or services and has approved such change in writing. Seller shall be responsible for obtaining, completing and submitting proper documentation regarding any and all changes, including complying with any written change procedures issued by Buyer.
  17. Intellectual Property. Seller retains ownership of all intellectual property it owned before or developed independent of this Order. Seller hereby grants Buyer an irrevocable, non-exclusive and royalty-free license to use, and sell products and services embodying any and all intellectual property which may be used, made, conceived, or actually reduced to practice in connection with the performance of this Order. If Buyer furnishes specifications, requirements, designs, Confidential Information, data, or other intellectual property (collectively, “Designs”) to Seller for the manufacture of the Goods or provision of services, then Seller acknowledges that Buyer is and remains the sole and exclusive owner of the Design, and all improvements, modifications, derivative works and intellectual property rights in them. In such event, Seller assigns, and will cause Seller Affiliate to assign, all improvements, modifications, derivative works and intellectual property rights in the Designs to Buyer or its designee. If the Order includes paid-for services (including other payment in kind) for development of technology, Seller also agrees to assign and deliver, and will cause Seller Affiliate to assign and deliver, all intellectual property rights and materials related to the development to Buyer or its designee. “Buyer Intellectual Property” means: (i) the intellectual property rights for all goods and/or services under the Order except what Seller owned prior to or developed independently of its obligations under the Order; (ii) intellectual property conceived, produced or developed by Seller, whether directly or indirectly or alone or jointly with others, in connection with or pursuant to Seller’s performance under the Order; and (iii) creations and inventions that are otherwise made by Seller through the use of Buyer’s or its Affiliates’ equipment, funds, supplies, facilities, materials and/or Confidential Information. Buyer grants Seller a non-exclusive, non-assignable, revocable license to use Buyer Intellectual Property and Confidential Information furnished to or accessed by Seller that is necessary for the sole purpose of performing the Order. Seller may not use, disclose, or reproduce Buyer Intellectual Property or Confidential Information for any other purpose. Seller agrees that it will neither apply for any registration of rights in any Buyer Intellectual Property nor oppose or object in any way to applications for registration thereof by Buyer or others designated by Buyer.
  18. Warranties. Seller agrees to warrant the Goods in accordance with the Supplier Warranty Terms attached hereto as Appendix A.
  19. Recalls. If Buyer, any of Buyer’s customers or any Governmental Authority determines that any Goods sold to Buyer are defective and a recall campaign is necessary, Buyer will have the right to implement such recall campaign at Seller’s cost.  Seller shall have insurance in order to cover costs relating to the replacement, refurbishment, repair, or modification of Goods, in the event of any recall of any of the Goods due to (i) defective workmanship, (ii) failure to manufacture in conformance with applicable designs, specifications, and/or tolerances, or (iii) failure to manufacture in conformance with applicable laws and regulations (a “Seller Recall”), and all other costs and expenses actually and reasonably incurred by Buyer, including, without limitation, costs associated with sending notices to Buyer’s customers and shipment of recalled Goods from Buyer’s customers to Buyer or Seller. Seller shall use commercially reasonable efforts to correct, as promptly as is practicable, all issues which result in Seller Recalls. For the purpose of this Order, “Governmental Authority” means any U.S. federal, state, or local government or political subdivision thereof, or any agency or instrumentality of the government or political subdivision, or any self-regulated organization or other non-governmental regulatory authority, or quasi-governmental authority (to the extent that the rules, regulations, or orders of this organization or authority have the force of law), or any arbitrator, court, or tribunal of competent jurisdiction.
  20. General Indemnification. Seller shall defend, indemnify and hold harmless Buyer its subsidiaries, affiliates, successors or assigns and its respective directors, officers, shareholders and employees and Buyer’s customers (collectively, “Indemnitees”) against any and all loss, injury, death, damage, liability, claim, deficiency, action, judgment, interest, award, penalty, fine, cost or expense, including reasonable attorney and professional fees and costs, and the cost of enforcing any right to indemnification hereunder and the cost of pursuing any insurance providers (collectively, “Losses”) arising out of or occurring in connection with any and all Goods purchased from Seller or Seller’s negligence, willful misconduct or breach of the Order. Seller shall not enter into any settlement without Buyer’s or Indemnitee’s prior written consent.
  21. Intellectual Property Indemnification. Seller shall, at its expense, defend, indemnify and hold harmless Buyer and any Indemnitee against any and all Losses arising out of or in connection with any claim that Buyer’s or Indemnitee’s use or possession of the Goods infringes or misappropriates the patent, copyright, trade secret or other intellectual property right of any third party. In no event shall Seller enter into any settlement without Buyer’s or Indemnitee’s prior written consent.
  22. Confidentiality and Publicity. “Confidential Information” (1) shall have the meaning set forth in the non-disclosure agreement (“NDA”) entered into by the parties or (2) if no such agreement is entered into by the parties, means (i) any and all information and data, employment information, employment plans, business and marketing strategies and procedures, product information, product development, product roadmaps, designs, conceptions, materials, formulations, documents, pricing and costing information, financial data, product components, product configurations, tolerances, formulas, drawings, photographs, sketches, models, mockups, test data, design or performance specifications, and trade secrets, whether oral, written, or stored in electronic or other recordable media formats; (ii) all other information that is learned by Seller from Buyer or through the inspection or evaluation of Buyer’s technical, financial or business information; (iii) all data and information obtained by Seller through face-to-face meeting, telephonic meeting or videoconferencing; and (iv) notes, analyses, studies or other documents prepared by Seller that contain or are based on such information or material relating to the information disclosed by Buyer. The terms in the NDA governing each party’s confidentiality obligations shall also apply herein, if no such NDA is in place between the parties, during the term of this Order and 10 years after this Order terminates, and for as long as Confidential Information remains a trade secret, Seller and its Affiliates (a) will use the information only for performing the Order; (b) protect the Confidential Information with at least a reasonable standard of care to prevent disclosure of the Confidential Information; (c) promptly notify Buyer if any of its Confidential Information is disclosed in breach of this Order; (d) make copies of Confidential Information only as required to perform the Order and all permitted copies must be marked “PSI Confidential – Do Not Use, Disclose, Reproduce or Distribute without PSI Permission”; (e) and stop using and promptly return or destroy all Confidential Information and copies thereof (except the terms of this Order) upon termination of this Order or upon Buyer’s request. Seller may disclose Confidential Information to a Seller’s employee who has a need to know and who is bound in writing to confidentiality obligations and use restrictions at least as restrictive as in this Order. Seller may also disclose Confidential Information to comply with a legal obligation, but only after promptly notifying Buyer of its disclosure obligation so that Buyer may seek an appropriate protective order. Confidential Information does not include information that can be shown by written evidence that: (a) is or becomes publicly available other than as a result of disclosure by Seller; (b) was available on a non-confidential basis to Seller before its disclosure to Seller; (c) is or becomes available to Seller on a non-confidential basis from a source other than Buyer or its Affiliates, or (d) was independently developed by Seller, without reference to the Confidential Information. Except to the extent required by law, Seller or its Affiliates shall not release information with respect to the existence or terms of this Order or any related document and shall not use the name, logo, trademarks, photographs or any reference to Buyer or its Affiliates in advertising, marketing, public relations or similar publications without the prior written authorization of a duly authorized representative of Buyer or the relevant Buyer Affiliate. Buyer shall be entitled to injunctive relief for any violation of this Section 22.
  23. Termination. Buyer may terminate this Order, in whole or in part, at any time with or without cause for undelivered Goods on 10 days’ prior written notice to Seller. In addition to any remedies that may be provided under these Terms, Buyer may terminate this Order with immediate effect upon written notice to Seller, either before or after the acceptance of the Goods, if Seller has not performed or complied with any of these Terms, in whole or in part. If Seller becomes insolvent, files a petition for bankruptcy or commences or has commenced against it proceedings relating to bankruptcy, receivership, reorganization or assignment for the benefit of creditors, then the Buyer may terminate this Order upon written notice to Seller. If Buyer terminates the Order for any reason, Seller’s sole and exclusive remedy is payment for the Goods received and accepted by Buyer prior to the termination.
  24. Waiver. No waiver by any party of any of the provisions of the Order shall be effective unless explicitly set forth in writing and signed by the party so waiving. Except as otherwise set forth in the Order, no failure to exercise, or delay in exercising, any rights, remedy, power or privilege arising from the Order shall operate or be construed as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.
  25. Insurance. Prior to performance of any Goods under any Order, Seller shall obtain at its own expense, comprehensive general liability and product liability insurance in amounts and coverages sufficient to cover all claims hereunder for the entire duration of the Order and compliance with Buyer’s insurance and safety requirements. Seller will provide Buyer with certificates of insurance evidencing the coverage required herein or in any agreement between the parties. Buyer shall be named as additional insureds on all Seller’s liability policies, including those in excess of the required minimums set forth in this Section, and all coverage Seller’s insurance shall in no way limit Seller’s obligations or liability under these Terms or any Order.
  26. Force Majeure. Neither party shall be liable to the other for any delay or failure in performing its obligations under the Order to the extent that such delay or failure is caused by an event or circumstance that is beyond the reasonable control of that party, without such party’s fault or negligence, and which by its nature could not have been foreseen by such party or, if it could have been foreseen, was unavoidable (“Force Majeure Event”). Force Majeure Events include, but are not limited to, acts of God or the public enemy, government restrictions, floods, fire, earthquakes, explosion, epidemic, war, invasion, hostilities, terrorist acts, riots, embargoes or industrial disturbances. For the avoidance of doubt, Seller’s labor issues, procurement, economic hardship or changes in market conditions are not considered Force Majeure Events. Seller shall use all diligent efforts to end the failure or delay of its performance, ensure that the effects of any Force Majeure Event are minimized and resume performance under the Order. If a Force Majeure Event prevents Seller from carrying out its obligations under the Order for a continuous period of more than 10 business days, Buyer may terminate this Order immediately by giving written notice to Seller.
  27. Compliance with Laws. Seller represents, warrants, certifies and covenants that the Goods fully comply with all applicable laws, rules, regulations and ordinances, including all environmental laws in locations in which the Goods is likely to be used or sold including without limitation EPA, CARB, REACH, RoHS and CE (collectively, “Laws”) and shall provide for any Goods, upon request, all reports and required information including, but not limited to, certifications, component natural resources, as required under such Laws such as conflict minerals report, in all cases, such report shall be provided no later than thirty (30) days of the request. If the Goods is manufactured in a country other than the country in which goods are delivered to Buyer, Seller will mark the Goods “Made in (country of origin)” and shall retain sufficient documentation to enable the country of origin of the Goods to be traced within the Goods sold to Buyer and Seller shall provide such information to Buyer no later than thirty (30) days upon request by Buyer. Seller represents, warrants, certifies and covenants that Goods, including its composition and packages, has not and will not be produced or supplied (by Seller or its suppliers) in segregated facilities or any location in which segregated facilities are maintained; by using forced, indentured, convict or child labor; in violation of minimum wage, hour of service or overtime laws of the country of manufacture or in any jurisdiction in which Goods or services are provided; or in non-compliance with any domestic or international laws and directives applicable to the Goods.
  28. Forced Labor. Seller shall not, and shall ensure that its suppliers, subcontractors, and other business partners involved in the production, or manufacture of the Goods (“Subcontractors”) do not, use any form of convict, indentured, or forced labor, including forced or indentured child labor (“Forced Labor”) at any stage of the production, or manufacturing process for the Goods or any of its components. Seller shall, and shall ensure that its Subcontractors, comply with Buyer’s Forced Labor policy, a copy of which can be found at Buyer’s website. Seller agrees to provide within 10 days of Buyer’s request a certificate, which can be found at Buyer’s website, signed by Seller’s duly authorized representative, certifying that Forced Labor was not used at any stage of the production or manufacturing process for the Goods or any of its components. Upon Buyer’s request, Seller shall also obtain such certificates from its Subcontractors and provide a copy of such certificates to Buyer. Buyer or its third-party auditor has the right to conduct announced or unannounced on-site inspections of Seller’s facilities and any other facilities used in connection with the production, or manufacture of the Goods and audit all pertinent books and records to (a) verify Seller’s compliance with this Section 28, or (b) conduct an investigation into the suspected use of Forced Labor by Seller or any of its Subcontractors. Seller shall provide Buyer or its auditors access to all of Seller’s and its Subcontractors’ facilities and books and records necessary to conduct such inspections or investigations and shall cooperate in all other respects with any investigation by Buyer into the suspected use of Forced Labor. If Buyer determines that Seller is in violation of the terms of this Section 28, in addition to any other rights and remedies Buyer may have under this Order or at law or in equity, Buyer shall have the right to immediately cancel the affected purchases and terminate this Order without any liability or further obligation to Seller.
  29. Buy American. Upon request by Buyer in writing, Seller shall use only products and materials that are manufactured or produced in the United States of America in the performance of this Order. This requirement includes all components and parts used in the manufacture or assembly of the deliverables. In such event, Seller shall provide certification of compliance with this requirement within thirty (30) days upon request. Additionally, Seller shall ensure that its subcontractors and suppliers also comply with the Buy American Act for any products or materials provided to Seller for use in the performance of this Order. Seller shall be responsible for any noncompliance of its subcontractors or suppliers with this requirement.
  30. Export Control. The Goods, services and/or technical data (collectively “Items”) delivered under this Order may be subject to U.S. and other applicable export control laws and regulations (collectively “Export Control Laws”), including, but not limited to, the International Traffic in Arms Regulations or the Export Administration Regulations (collectively “S. Export Laws”) and/or U.S. Export Control List(s). Seller shall comply with all U.S. and other countries’ applicable Export Laws and shall not export, re-export or transfer items without first obtaining all required licenses and approvals. Compliance with Export Control Laws include, but is not limited to, abiding by U.S. sanctions, embargoes and prohibitions on transactions with restricted parties. This includes, but is not limited to, the prohibition on the transfer of commodities, materials, software and technology (i.e., all Items) subject to this Agreement to U.S. sanctioned countries.
  31. FCPA. Seller shall comply with all applicable anti-corruption laws, including, without limitation, the U.S. Foreign Corrupt Practices Act, and neither it nor any of its subcontractors, vendors, agents or other associated third parties will engage in any form of commercial bribery, nor directly or indirectly provide or offer to provide, anything of value to or for the benefit of, any official or employee of a governmental authority or of any government-owned, government-controlled or government-affiliated entity to obtain or retain any contract, business opportunity or other business benefit, or to influence any act or decision of that person in his/her official capacity.
  32. Assignment. Seller shall not assign, transfer, delegate or subcontract any of its rights or obligations under the Order without the prior written consent of Buyer. Any purported assignment or delegation in violation of this Section shall be null and void. No assignment or delegation shall relieve the Seller of any of its obligations hereunder.
  33. Relationship of the Parties. The relationship between the parties is that of independent contractors. Nothing contained in the Order shall be construed as creating any agency, partnership, joint venture or other form of joint enterprise, employment or fiduciary relationship between the parties, and neither party shall have authority to contract for or bind the other party in any manner whatsoever. No relationship of exclusivity shall be construed from this Order.
  34. No Third-Party Beneficiaries. This Order is for the sole benefit of the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other person or entity any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of these Terms.
  35. Governing Law. All matters arising out of or relating to this Order shall be governed by and construed in accordance with the internal laws of the State of Illinois without giving effect to any choice or conflict of law provision or rule (whether of the State of Illinois or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than those of the State of Illinois.
  36. Submission to Jurisdiction. Any legal suit, action or proceeding arising out of or relating to this Order shall be instituted in the federal courts of the United States of America or the courts of the State of Illinois in each case located in the County of Du Page, and each party irrevocably submits to the exclusive jurisdiction of such courts in any such suit, action or proceeding.
  37. Cumulative Remedies. The rights and remedies under this Order are cumulative and are in addition to and not in substitution for any other rights and remedies available at law or in equity or otherwise.
  38. Notices. All notices, request, consents, claims, demands, waivers and other communications hereunder (each, a “Notice”) shall be in writing and addressed to the parties at the addresses set forth on the face of this Order or to such other address that may be designated by the receiving party in writing. All Notices shall be delivered by personal delivery, nationally recognized overnight courier (with all fees pre-paid), facsimile (with confirmation of transmission) or certified or registered mail (in each case, return receipt requested, postage prepaid). Except as otherwise provided in this Order, a Notice is effective only (a) upon receipt of the receiving party, and (b) if the party giving the Notice has complied with the requirements of this Section.
  39. Severability. If any term or provision of this Order is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Order or invalidate or render unenforceable such term or provision in any other jurisdiction.
  40. Survival. Provisions of this Order which by their nature should apply beyond their terms will remain in force after any termination or expiration of this Order including, but not limited to, the following provisions: Set-off, Warranties, Recalls, General Indemnification, Intellectual Property Indemnification, Insurance, Compliance with Laws, Confidentiality and Publicity, Governing Law, Cumulative Remedies, Submission to Jurisdiction and Survival.

APPENDIX A – SUPPLIER WARRANTY TERMS

PRODUCT WARRANTY

Seller warrants to Buyer that for the applicable period listed below, the Goods will: (a) be free from any defects in workmanship, material and design; (b) conform to applicable specifications, drawings, designs, samples and other requirements specified by Buyer; (c) be fit for their intended purpose and operate as intended; (d) be merchantable; (e) be free and clear of all liens, security interests or other encumbrances; and (f) not infringe or misappropriate any third party’s patent or other intellectual property rights, for the period of:

 

Prime/Continuous Duty Applications – 1 year or 8,760 hours, whichever occurs last

Standby Applications – 2 years or 1,000 hours, whichever occurs last

Mobile Industrial Applications – 3yrs/3,500 hours, whichever occurs last

On Road Applications – 5yrs/100,000 miles, whichever occurs last

After Sales Parts Warranty – 12 Months after service part is installed

The warranty term begins upon site commissioning at the end user for industrial applications or the vehicle sale date to the end user for on road applications.  These warranties survive any delivery, inspection, acceptance or payment of the Goods.

WARRANTY REIMBURSEMENT

  1. Seller shall reimburse Buyer for warranty claim costs as determined by Buyer, in its sole discretion, to be a result of a defect in the Seller’s material, design, and/or workmanship as follows:
  2. Material costs at Seller’s selling price to Buyer plus 33% allowable markup plus
  3. 100% Claimed labor cost plus
  • Maximum labor rate will be capped at $145 USD per hour regular time and $185 USD per hour overtime plus
  1. Travel costs up to 300 miles roundtrip at $2.00 USD per mile plus
  2. Travel time at $145 USD per hour up to a maximum of 5 hours plus
  3. Freight charges associated with the delivery of replacement parts plus
  • Freight costs incurred by Buyer due to return failed material to Seller plus
  • Cost of repairs of any damage to other components caused by Sellers defective parts plus
  1. Third party contractors (cranes, hoists, special equipment, or similar).

These warranty reimbursements are cumulative and in addition to any other warranty provided by law or equity. Any applicable statute of limitations runs from the date of Buyer’s discovery of the noncompliance or defects of the Goods with the foregoing warranties.

  1. Reimbursement for warranty claims
    1. Claims should be reimbursed to Buyer within 30 days of the date the claim is submitted to Buyer.
    2. Seller should issue a payment to Buyer via bank wire, check, or credit to Buyer’s account.
  • Notification of the payment should be sent to Buyer’s warranty department and should include the details on what claims have been paid.
  1. In the event the claims have not been reimbursed by Seller within 30 days, Buyer has the right to debit Seller for the full claim cost without notice.
  2. If Buyer gives Seller notice of warranty issues in relation to the Goods that cannot be remedied by Buyer or its third party contractors, in addition to the reimbursements in Section A above, Seller shall, at its own cost and expense, within 5 days upon the receipt of notice from Buyer, replace or repair the defective or nonconforming Goods and pay for all related expenses, including, but not limited to, transportation charges for the return of the defective or nonconforming Goods to Seller and the delivery of repaired or replacement Goods to Buyer.

FACTORY QUALITY AND COST OF POOR QUALITY

  1. Quality issues that occur at a Buyer’s manufacturing facility or Buyer OEM’s manufacturing facility is deemed to be a factory quality issue. Factory quality issues are managed by Buyer’s quality, operations, and purchasing departments directly with Seller.  In the event there is a factory quality issue as determined by Buyer, in its sole discretion, Seller will reimburse Buyer for the following costs:
  1. Costs to investigate the quality issue plus
  2. Sorting, reworking, retest, or containment charges (performed by Buyer or 3rd party) plus
  • Line disruption costs plus
  1. Freight or travel costs associated with the factory quality issue.
  1. Seller agrees to provide Buyer an 8D quality document if requested:
    1. 8D Quality document should be filled out including root cause and containment actions
    2. 8D requests should be responded to by Seller within 24 business hours from the time the request is made to Seller.