Vivid Inc. Terms of Purchase


1. OFFER AND ACCEPTANCE: This purchase order, together with the written information contained on the face of this purchase order (“Order”) and all attachments, and exhibits attached hereto constitute an offer to buy goods or services. Acceptance of this offer and the formation of a binding contract will only occur if the party named on the purchase order (“Seller”) agrees to the terms and conditions hereof. Vivid, Inc. (“Buyer”) hereby objects to varying terms offered by Seller in its sales order acknowledgment or any other document of Seller. Such varying terms shall not become a part of this order without the express written consent of the Buyer. Seller’s issuance of a sales order acknowledgment, shipment of goods or commencement of work hereunder shall constitute acceptance of this offer and the formation of a binding contract based on the terms and conditions hereof. In no event shall Buyer’s silence in response to any document containing Seller’s terms and conditions be construed as an acceptance of any such terms or conditions. The Order is by and between Seller and Buyer, and does not bind any other entity, including any affiliate of Buyer.

2. CHANGES: Buyer shall have the right at any time to suspend performance under this Order, decrease or increase the ordered quantities, change the delivery date of the ordered products, or make changes in drawings, designs, specifications, materials, packaging, place of delivery and/or method of transportation (“Changes”). Seller agrees to accept such Changes as though the Changes were included in the Order. If any Changes cause an increase or decrease in the cost, or the time required for performance, Seller shall notify Buyer, and the parties shall agree on an equitable adjustment in the price and/or delivery date, and shall modify the Order in writing, No claim by Seller for such an adjustment will be valid unless asserted in writing within fifteen (15) days (or such longer period as may be agreed to in writing by Buyer) after the date on which Seller received the notification of the Change. Except in the event of a Change, Seller shall not make any changes to the form, fit, or function of any ordered products or any changes to the drawings, designs, specifications, materials, process, packaging, time and place of delivery or method of transportation without Buyer’s prior written consent.

3. WARRANTIES: (a) Seller warrants that the products furnished hereunder (i) shall be free from any defect or nonconformity in design, materials, workmanship and manufacture; (ii) shall be in strict compliance with the requirements of this Order and generally accepted engineering and manufacturing standards; (iii) are of merchantable quality and fit for the purposes intended by Buyer (iv) shall be capable of operation in accordance with Seller’s operating recommendations and limitations, and in the absence thereof, standard industry practice; (v) shall be new and unused, until the earlier of eighteen (18) months after first placed into service or thirty-six (36) months after delivery. Seller shall correct any such nonconformity with this warranty at its sole expense and at the direction and sole discretion of Buyer, by promptly accomplishing one or more of the following: (i) repairing or replacing the nonconformity at no cost to Buyer; (ii) furnishing Buyer any materials, parts and instruction to make any required repairs at Seller’s expense or (iii) providing a refund to Buyer. In the event of any breach or non-compliance by Seller with this warranty obligation, Buyer shall also be entitled to recover any and all costs and expenses incurred by Buyer or payable to third parties, but not limited to, additional costs of Buyer’s personnel (based on standard hourly rates) or other labor, evaluation costs, re-working or scrapping cost, additional or premium transportation and/or testing conducted by Buyer. (b) Seller warrants that any technical field assistance or other services furnished by it shall reflect the highest standards of professional knowledge and judgment and shall be in strict compliance with the requirements of this Order. Seller shall correct any nonconformity with this warranty at its sole expense, as directed by Buyer, by promptly (i) re-performing the work or (ii) paying or refunding to Buyer a corresponding portion of the Order price. (c) The warranty with respect to any corrections shall be subject to the same terms as the original warranty except that the warranty period on any such corrections shall be one (1) year from the date of repair or replacement or until the end of the original warranty period, whichever is longer. (d) Seller represents and warrants that all equipment, material, components or parts furnished hereunder are free of asbestos or asbestos-containing materials. (e) In addition to the foregoing warranties, Seller warrants that the ordered products, Seller’s business (including its manufacturing, operating and hiring processes) and the product documentation comply with all international, national, federal, state and local ordinances, rules and regulations (including, without limitation, the Fair Labor Act of 1938, the Occupational Safety and Health Act of 1970, the Toxic Substances Control Act of 1976 and the Transportation Safety Act of 1974, all regulations of the Food and Drug Administration, the Federal Acquisition Regulations and any similar laws, rules or regulations outside of the United States, as such laws, rules and regulations have been amended, modified or implements from time to time (collectively, “Laws”) and that the manufacture and sale of the ordered products complies with all Laws. Seller further warrants the accuracy of all product documentation it provides to Buyer, including without limitation, customs-related documents and safety related documents.

4. INSPECTION: All material received by Buyer will be subject to Buyer’s inspection, acceptance or rejection. Rejected materials shall be returned at Seller’s expense, including transportation charges paid by Buyer. No replacement of defective material returned will be made unless so specified on Buyer’s return order.

5. INDEMNIFICATION: Seller shall defend, indemnify and hold harmless Buyer, its subsidiaries, affiliates, customers and other designated parties from and against any and all losses, expenses, liens, claims, demands and causes of action of every kind and character (including those of the parties, their agents and employees) for death, personal injury, property damage or any other liability, damages, fines or penalties (except where reimbursement of fines or penalties is prohibited by applicable law), including, without limitation, costs, attorneys’ fees and settlements arising out of in connection with the ordered products, or which arise out of, result from or are contributed to by (i) the acts, omissions, fault or negligence in any form of Seller, its subcontractors or suppliers or any other parties for which Seller may be responsible, or any of their respective agents, employees, representatives or contractors (ii) any equipment, components, materials or products furnished, sold or otherwise provided under the Order; (iii) any alleged or actual claim that the ordered products, the use or sale of the ordered products or the equipment or processes used to manufacture and/or assemble the ordered products infringe any patent, copyright, trademark, trade secret or other form of intellectual property right of any third party or (iv) any violation of law.

6. CONFIDENTIALITY: Seller agrees to hold all Buyer’s information and trade secrets in strict confidence and not to disclose said information or trade secrets to any third party at any time or to use such information for any purpose except to fulfill its obligations to Buyer under this Order. Buyer and Seller agree that Buyer’s information, including without limitations, drawings and specifications, and all copies thereof shall be returned to Buyer upon Buyer’s written request. In the event Buyer and Seller have a nondisclosure agreement in place, the provisions of such agreement shall prevail over the provisions of this Section 6.

7. COMPLIANCE WITH LAWS: Seller represents and warrants that in the performance of this order it will comply with the provisions of all Laws. Any provision which is required to be a part of this Order by virtue of any such Law is incorporated herein by reference; including, but not limited, to Executive Order 11246, as amended; Section 503 of the Rehabilitation Act of 1973, as amended; Section 402 of the Vietnam Era Veterans Readjustment Assistance Act of 1974, as amended, and their respective implementing regulations.

8. PRICE: Prices stated on this Order apply to all shipments on this Order, and Seller warrants that the prices do not exceed the prices Seller charges other buyers for the same type of product in comparable quantities. Buyer has no obligation to honor invoices for ordered products at any increase price unless and until Buyer’s authorized agent confirms the increase in writing. Seller must separately state on its invoices the amount of any tax applicable to the sale under this Order and payable by Buyer in the absence of evidence of lawful exemption. . If Buyer claims a tax or other exemption or direct payment permit, it shall provide Seller with a valid exemption certificate or permit and indemnify, defend and hold Seller harmless from any taxes, costs and penalties arising out of same. Unless separately stated on the Order, Seller agrees that all excise, occupational, sales, use and other taxes applicable to the sale or purchase of products under this Order shall be paid by Seller, and Seller shall indemnify and hold Buyer harmless from and against all liability for such taxes. Unless otherwise stated on the Order, the price shown on the Order includes all charges, freight and packaging.

9. PAYMENT: (a) Unless otherwise stated, all payments with respect to a valid and undisputed invoice shall be net sixty (60) days from the date of invoice payable in United States Dollars. (b) In the event Buyer disputes any portion or all of an invoice, it shall notify Seller in writing of the amount in dispute and the reason for its disagreement within twenty-one (21) days of receipt of the invoice. The undisputed portion shall be paid when due, and finance charges on any unpaid portion shall accrue, from the date due until the date of payment, to the extent that such amounts are finally determined to be payable to Seller.

10. TITLE/SHIPPING: All Products will be delivered as stated on the face of the Order.

11. SHIPMENT, PACKAGING, LABELING AND ROUTING: Shipments must be packaged according to Buyer’s specifications or, in the absence of such specifications, according to industry, standards and, in the absence of such industry standards, in a manner so as to permit efficient handling, provide adequate protection, and comply with the reasonable requirements of carrier. Shipping documents in duplicate and a separate invoice for each shipment on any Order must be mailed to the Buyer’s facility or office issuing the order on the same day shipment is made, unless otherwise noted or agreed. All shipments must contain packing lists giving full description of material, quantity, and purchase order number. Buyer’s count shall be accepted as final on all shipments not accompanied by a packing list, if promptly communicated in writing to Seller. Damage resulting from improper packaging will be charged to Seller. Unless otherwise agreed, no charges will be allowed for packaging, boxing, crating, returnable containers, drayage, cartage, demurrage or dunnage. Buyer’s purchase order number, Buyer’s part number, Seller’s part number and quantity shall appear conspicuously on each package, box, crate or other type of shipping container. Seller shall route shipment as instructed using third party shipping, unless otherwise noted. Shipments sent C.O.D. without Buyer’s written consent will not be accepted and will be at Seller’s risk.

12. TERMINATION AND CANCELLATION: (a) In the event Buyer reasonably concludes that (i) by reason of war or other emergency conditions, national defense activities, pandemics or epidemics, inability to secure transportation, embargoes, strikes, differences with workers, accidents at Buyer’s plants, or any other contingency beyond Buyers reasonable control and arising subsequent to the date of this Order but before delivery, the ordered products, or any part thereof, cannot be used by Buyer for the purpose it intended as of the date of the Order, or (ii) for any reason, including, without limitation, the financial condition of Seller, Seller’s prior performance under this Order, any prior order or any similar occurrence (including, without limitation, failure to meet reasonable delivery schedules and repeated failure to meet quality and specifications standards), or accidents or differences with workers at Seller’s plants, or Seller’s timely performance under this Order is doubtful, Buyer may, at its sole election, by notice to Seller without indemnity to Seller or other liability on the part of Buyer: (x) suspend shipment of the ordered products or any portion thereof for a period or periods in the aggregate not exceeding ninety (90) days (y) cancel this Order as to undelivered ordered products or any part thereof, or (z) so suspend shipment and, thereafter, during the period of suspension, cancel this Order. (b) Buyer may, at any time and without cause, terminate this Order in whole or in part by notice to Seller specifying the extent of such termination. With respect to customer orders, in the event Buyer terminates an Order without cause less than thirty (30) days prior to the scheduled delivery date, (i) Seller will immediately terminate work to the extent specified and, for the benefit of Buyer, dispose of finished ordered products and work-in-progress on the ordered products as Buyer may direct in writing, and (ii) Buyer shall pay to Seller an amount, if any, not in excess of the unpaid aggregate price specified in this Order, equal to the sum of (x) the contract price for items of finished ordered products in Sellers hands at the time of termination plus (y) Seller’s actual cost for work in progress (as determined by Buyer’s certified public accounts in accordance with generally accepted accounting principles) incurred prior to termination and attributable to the terminated portion of the work. In addition to any other rights set forth herein, in the event Seller breaches any of its obligations hereunder, Buyer may, at any time, terminate this Order by notifying Seller. Buyer has no further obligations except to pay the undisputed amounts for any products by Buyer prior to the termination date.

13. INSURANCE: (a). Seller shall procure and maintain insurance continuously throughout the term of this Agreement from companies that are licensed in the state in the State of California and listed in the current Bests Insurance Guide as possessing a minimum policy holders rating of A- (Excellent) and a financial category no lower than VI. (b). Prior to the delivery of any ordered products, and annually thereafter or prior to policy expiration (whichever time period is shorter), Seller shall furnish to Buyer, at Buyer’s request, a reasonably acceptable Certificate of Insurance specifying coverage. The certificate of insurance shall cover: (i) Workers Compensation insurance for statutory limits or a State certificate. Employers Liability coverage should have limits of $500,000. (ii) Occurrence type commercial general liability insurance, including blanket contractual coverage, for personal injury and property damage of not less than $1 million combined single limit per occurrence. (iii) Automobile liability insurance covering all owned, non-owned and hired vehicles, with limits of not less than $1 million combined single limit per occurrence. (iv) Excess insurance coverage with a combined single limit of not less than $4 million per occurrence in excess of the underlying commercial general liability insurance requirements set forth above. (c) Each insurance policy listed above must name Buyer as an insured or additional insured under the policy. (d). The insurance policies providing the foregoing coverage shall provide that the insurance company issuing such policy shall give Buyer at least thirty (30) days prior written notice of any material alterations, including substantial reduction of aggregate limits, if such limits apply, and change or cancellation of the policy.

14. MISCELLANEOUS: (a) Any waiver or failure by either Buyer or Seller to require strict compliance with the provisions of this order in any respect shall be in writing and shall not be deemed a waiver of such party’s right to insist upon strict compliance thereafter. (b) Except as expressly contemplated by this purchase order, this order shall not be modified without the express prior written consent of the Buyer or Seller, as the case may be. (c) This order shall not be transferred or assigned by Seller, and the monies due hereunder shall not be assigned, without the prior written consent of Buyer. Buyer shall have the right to transfer all or part of this Order to a third party, upon fifteen (15) days prior written notice to Seller. (d) Each of Buyer and Seller retains generally all rights and remedies granted to it by operation of law, or in equity, in addition to those set forth herein. (e) Seller shall provide Buyer with a written one hundred eighty (180) day notice of its intent to discontinue the sale of any ordered products so that Buyer, at Buyer’s option, may make an end of life purchase. (f) The terms set forth the entire agreement between the parties with respect to the subject matter hereof and supersede all prior agreements and discussions between them. No modification or amendment hereof will be effective unless in writing and signed by a duly authorized representative of each party. Any terms and conditions set forth in any order confirmation or acknowledgement or any other documents shall be of no force or effect whatsoever. (g) The State and federal courts located in the County of Santa Clara, State of California shall have exclusive jurisdiction and venue to adjudicate any and all disputes arising out of or in connection with this Order. The Parties consent to the exercise by such courts of personal jurisdiction over them and each party waives any objection it may otherwise have to venue, personal jurisdiction, inconvenience of forum, or any similar or related doctrine. This Order shall be construed in accordance with the substantive laws of the State of California (excluding its conflict of laws principles). The provisions of the United Nations Conventions on Contracts for the International Sale of Goods shall not apply to this Order.